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Reflections October 2016

The Hippocratic Oaf

Lifetime Reserve Days; Run Logan Run!

By Daniel Crantz

A beneficiary is deemed to have elected not to use lifetime reserve days for outlier days if the average daily charge for the outlier days for which lifetime reserve days would otherwise be available is equal to or less than the daily coinsurance … Again, I fell asleep, so maybe that example was too long.

As an insurance agent, I had a client that actually read “Medicare and You,” a document published by CMS (Center for Medicare and Medicaid Services) and she was a little confused about “Lifetime Reserve Days.”

“It sounds ominous,” she said, “like you only get so many days to live and then you are on Lifetime Reserve Days.”

“Cool plot,” I thought to myself, and thinking back many years asked her, “Ever see the movie Logan’s Run?”

“Yes,” she said, “a long time ago, but I don’t remember the plot.”

“No problem,” I said, thinking back to that movie. I couldn’t really remember the plot either so I pulled out my smartphone (a device that has ruined many a good argument at the local bar) and searched Wikipedia and found the following description:

(The movie Logan’s Run (1976)) depicts a dystopian future society in which population and the consumption of resources are managed and maintained in equilibrium by the simple expedient of killing everyone who reaches the age of 30, preventing overpopulation. The story follows the actions of Logan 5, a "Sandman," as he runs from society's lethal demand.

She laughed, “I am well beyond 30.”

“Yeah,” I said, “but a 30-year Medicare recipient would be 95,” doing the complicated math in my head. (65+30=95) So when you’re 95 you better start running!” I then added, “Just kidding,” because you never know. As an insurance agent I did not want a complaint filed that I said or intimated that CMS was in any way dystopian. Kafkaesque is OK, but they may find dystopian to be insulting.

We decided that “CMS Lifetime Reserve Run” would not make a good movie because, how hard can it be to catch a 95 year old?

Answer: Harder than you think if you’re trying to shoot them! So we decided to pitch the plot to Hollywood – we’ll keep you posted.

So what are Lifetime Reserve Days you ask? It is difficult to find a good definition/description on the CMS website, so the following is from www.eldercareteam.com.

“Medicare limits the number of days you may stay in the hospital per Benefit Period to 90. After 90 days you must leave the hospital and have no in-patient care for 60 consecutive days in order to re-set the Benefit Period clock…..

“Medicare has something called Lifetime Reserve Days. Lifetime Reserve Days are 60 additional hospital days that Medicare will pay for after the first 90 without having to reset the Benefit Period clock. Each of these 60 additional days can be used only once in your lifetime. They cannot be replenished.

“During these 60 Reserve days Medicare will pay all covered costs except for a daily co-insurance amount of $644 per day in 2016. Medicare Secondary (medigap) Insurance often covers this daily co-payment charge. Check your policy…..

“You use your Lifetime Reserve Days one at a time. If your hospitalization exceeds the maximum by only 5 Reserve Days, then you have 55 of the initial 60 Reserve Days remaining to use any time in your lifetime.”

Well, this seemed fairly straightforward. I think I actually understand this, mostly. But I decided to go back to cms.gov (The Medicare Website) and to get a further explanation in the form of examples. Below are excerpts from our informative government.

Example 3: Mr. Spencer was admitted to a hospital on April 1, 1995, and discharged on June 29, utilizing 89 regular days of inpatient care. On August 1, he entered the hospital again. For this DRG, outlier days would have begun August 26, but Mr. Spencer was discharged on August 23...

I must have fallen asleep at this point but woke up to read: ...after regular coverage days have been exhausted unless:

a.  The beneficiary elects not to use lifetime reserve days for the outlier days; or

b.  The beneficiary is deemed to have elected not to use lifetime reserve days for the outlier days.

A beneficiary is deemed to have elected not to use lifetime reserve days for outlier days if the average daily charge for the outlier days for which lifetime reserve days would otherwise be available is equal to or less than the daily coinsurance …

Again, I fell asleep, so maybe that example was too long. Let’s try a short one.

Example 7 : Mr. Kidd is admitted to the LTCH with 26 remaining days of regular Medicare coverage and is grouped to a LTC-DRG with an ALOS of 30 days. On the 26th day of that stay, Mr. Kidd has sufficient regular benefit days to trigger a full LTC-DRG payment (greater than 5/6 of the ALOS for that LTC-DRG) for this stay without going into lifetime reserve days. Mr. Kidd would only need to consider using lifetime reserve days should the stay continue and ultimately become a high cost outlier.

Thank goodness they cleared that up. I looked at my notes while reading these explanations.

As usual, CMS has impeccable math!

I am glad to be of assistance. My advice, if you get to day 59 of your 60-day reserve – start running!


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