I never really understood that, but was told it had to do with billing and insurance issues. Fortunately, she responded quickly and was sent home 23 hours after we arrived.
That 23 hours is the key: had we stayed just 60 more minutes, it would have been considered an "admission,": and additional costs involved. On the other hand, no one ever asked me what we wanted to do; apparently, my opinion about my daughter's care was unimportant. In fact, I didn't actually put 2+2 together until after we were home, and I had spoken with others more knowledgeable than I on these matters.
Reason I bring this up is because of this little doozy from Kaiser Health News:
"An increasing number of seniors who spend time in the hospital are surprised to learn that they were not "admitted" patients -- even though they may have stayed overnight in a hospital bed and received treatment, diagnostic tests and drugs."
So far, this sounds eerily familiar.
In the case of Seasoned Citizens, though, there may well be a very good reason for the 23 hour cut-off:
"Seniors must have three consecutive days as admitted patients to qualify for Medicare coverage for follow-up nursing home care"
That is, Medicare will only pay for follow-up care in a nursing facility if you've been admitted to, and stayed at least 3 days in, a hospital.
[By the way, this may be why so many folks believe - erroneously - that Medicare will cover their Long Term Care expenses.]
And, of course, different insurance plans may treat a 23 hour stay very differently than an actual admission:
"Because observation care is provided on an outpatient basis, patients usually have co-payments for doctors' fees and each hospital service"
There may be additional expenses for needed medications, as well.
So, what to do?
Well, first of all, make sure you understand what your specific plan says about "observation stays" versus actual admissions. And where possible, ask your attending or other staff how they're going to code this particular claim. There may be little or nothing you can do about that, but knowing how it's likely to be billed may at least give you an idea of what your out-of-pocket's going to be.
And knowing is half the battle.