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Despite Criticism, ED Clinicians Use Observation to Improve Care

IOWA CITY, IA – Critics charge that emergency physicians may overuse – or even abuse – observation stays strictly to maximize revenue and shift costs to patients. A new study suggests, however, that the condemnation isn’t really fair.

A study published in Annals of Emergency Medicine notes that observation stays for patients presenting to emergency departments are increasingly used in cases requiring diagnostic evaluation or time-limited treatment plans.

Insights from physicians on their decisions to admit, observe, or discharge can shed more light on the debate, as the study’s authors from the University of Iowa in the United States and the University of Leicester in the U.K. emphasize. They sought to better understand the views on observation stays by emergency physicians in the United States and England and what influences their decisions to pick that option.

To do so, researchers conducted in-depth, qualitative interviews with a sample of physicians in three hospitals across the two countries.

Results show that physicians chose observation for specific presentations in which evidence supports that choice but that they also acknowledged considering administrative and financial factors, study authors note. Furthermore, the participants described observation units as “safe spaces” that often avoid administrative scrutiny and allow them to deal with issues such as diagnostic uncertainties, socio-medical problems, and medicolegal challenges.


Observation gives admitting physicians options that may benefit patient safety and quality of care, the researchers conclude. As emergency departments consider reforms to using observation status, the authors note, they should consider these important functions.

Controversy about referral to observation units has raged over the last several years, primarily because Medicare and private insurance beneficiaries often have greater out-of-pocket expenses than with a hospital admission. Last fall, after a lengthy delay, the Centers for Medicare and Medicaid Services put into effect the Notice of Observation Treatment and Implication for Care Eligibility Act (NOTICE ACT), which requires hospitals to provide written and oral notice, within 36 hours, to Medicare patients who are in observation or other outpatient status for more than 24 hours.