The Center for Medicare Advocacy has heard that some Medicare beneficiaries believe that new federal rules authorize Medicare to pay for their nursing home care if they are inpatients in a hospital for two midnights. This belief is NOT CORRECT. New rules published by the Centers for Medicare & Medicaid Services (CMS) in August 2013, which became effective October 1, 2013, do NOT change the statutory requirement that a patient spend at least THREE consecutive days in a hospital as an inpatient in order to qualify for Medicare coverage of a subsequent stay in a skilled nursing facility (SNF). The two-midnight standard set out in the new regulations is simply a tool for physicians to apply in making inpatient admission decisions. If a physician believes a patient will require at least two midnights in the hospital, the physician should admit the patient to inpatient status, but patients continue to need three midnights as inpatients to qualify for Medicare coverage in a SNF.
The new rules do not solve the problem of observation status. Rather they demonstrate the need for legislative action to address this very serious issue. Under the new rules, patients may still be classified as outpatients in the hospital and fail to achieve a three-day inpatient stay to qualify for subsequent SNF care even though they are in a hospital bed for multiple days and the care they receive is indistinguishable from inpatient care. The new rules, in fact, say that if a physician is unsure that the patient will need to be hospitalized for two midnights, the physician should classify the patient as an outpatient. The rules explicitly provide that outpatient time "may not be retroactively included as inpatient care for skilled nursing care eligibility."
The "Improving Access to Medicare Coverage Act of 2013," pending in the House (H.R. 1179) and Senate (S. 569), would count all time in the hospital for purposes of determining Medicare coverage of SNF care. As of October 30, 106 Representatives have joined Congressman Joe Courtney (D, CT) in co-sponsoring the legislation; 24 Senators have joined Senator Sherrod Brown (D, OH) in co-sponsoring the identical bill in the Senate. The legislation has broad support from a unique coalition of national organizations and no opposition from any national organization.
You can encourage your Senators and Representatives to support the Improving Access to Medicare Coverage Act of 2013 at: http://org.salsalabs.com/o/777/p/dia/action/public/?action_KEY=8514
 78 Fed. Reg. 50495, 50906-954 (Aug. 19, 2013). See CMA, "Observation Status: New Final Rules from CMS Do Not Help Medicare Beneficiaries" (Weekly Alert, Aug. 29, 2013), http://www.medicareadvocacy.org/observation-status-new-final-rules-from-cms-do-not-help-medicare-beneficiaries/.
 See Coalition Fact Sheet at: http://www.medicareadvocacy.org/wp-content/uploads/2013/10/10-16-13-UPDATED-Coalition-Observation-Status-Fact-Sheet-00046258.pdf