Does Medicare Pay For Skilled Nursing in 2025?

 Hi Tom,

You are right! Medicare does pay for skilled nursing when one meets Medicare’s skilled nursing requirements. Unfortunately, your mother did not meet Medicare’s requirements and must pay the total amount.

A Medicare rule called the Medicare Outpatient Observation Notice (MOON) began in March 2017 and has made it harder to qualify.

This rule states that staying overnight in a hospital doesn’t always mean you’re an inpatient. You only become an inpatient when a hospital formally admits you as an inpatient and after a doctor orders it. You’re still considered an outpatient if you haven’t been admitted, even if you’re getting ER services, under observation, having outpatient surgery or lab tests, or receiving x-rays.

The 2025 Medicare & You Handbook explains this rule in even further detail: “Sometimes doctors will keep you as an outpatient for observation services while they decide whether to admit you as an inpatient or release (discharge) you. If you’re under observation for more than 24 hours, the hospital must give you ‘Medicare Outpatient Observation Notice’ (also called ‘MOON’). This notice tells you why you’re an outpatient (in a hospital or critical access hospital) getting observation services, and how it affects what you pay in the hospital and for care after you leave. You now have appeal rights when a hospital changes your status from inpatient to outpatient if you meet certain criteria. For more information, visit Medicare.gov/providers-services/claims-appeals-complaints/appeals/original-medicare.”

Toni Says: Always ask if you’re considered inpatient or outpatient each day during your stay since it affects what you pay.

What happened in Tom’s mother’s case?

Tom, it seems that your family members may not have been given the MOON (Medicare Outpatient Observation Notice) during your mother‘s hospital stay. The MOON form is provided in written form that is signed and dated with an oral explanation from the facility no later than 36 hours from the time the Medicare patient begins receiving outpatient observation services. This time limit is considered the new two-midnight stay observation policy and extends the time limit to qualify for Medicare-paid skilled nursing.

It’s important to note that hospitals must provide the MOON form CMS-10611, as per the Federal Notice of Observation Treatment and Implication for Care Eligibility Act (NOTICE Act). However, it does need to be issued to every patient—only those receiving at least 24 hours of observation services. The MOON also exists to inform patients about out-of-pocket costs. Tom, if you had received this notice, you would’ve been notified of the following information:

• Medicare Part A does NOT cover outpatient surgery.
• Part B, which does cover many outpatient services, requires a copayment for certain services after you meet the deductible. Currently, in 2025, the Medicare Part B deductible is $257.

What Do You Need to Know During a Hospital Stay?

So, what should Tom have done differently to prevent this from happening? Fortunately, I have a few answers that just might help Tom and others who might find themselves in his situation! When someone is having a hospital stay, family members and caregivers need to communicate with the care providers and ask them certain questions. Here are a few things you should remember:

1. Remember, the MOON rule applies to those on “Original Medicare” and not Medicare Advantage plans.

MAPD plans have their own skilled nursing facility qualifications. In fact, Medicare Advantage plans will cover a skilled nursing stay for up to 100 days if the following criteria are met:

• Your skilled nursing facility is a Medicare-approved facility.
• You receive skilled nursing services and/or therapy services that are required daily as ordered by a doctor.
• You need care for a medical condition that was treated for a three-day hospital stay.

2. Discuss the hospital procedure with your physician/surgeon regarding whether this will be an inpatient or outpatient stay.

It’s important to always communicate with any healthcare providers, especially when someone’s Medicare coverage is at play. According to Medicare.gov, even if you stay overnight in a regular hospital bed, you might be an outpatient. Don’t make assumptions! Ask the doctor or hospital for clarification. Remember, Medicare Advantage plans are different, so your costs and coverage will also be different. Check your plan and go from there!

3. Ask whether you’re an inpatient or outpatient.

The 2025 Medicare & You Handbook states the following:

“Whether you’re an inpatient or an outpatient affects how much you pay for hospital services and if you qualify for Part A skilled nursing facility care.

• You’re an inpatient when the hospital formally admits you with a doctor’s
  order.
• You’re an outpatient if you’re getting emergency or observation services
  (which may include an overnight stay in the hospital or services in an
  outpatient clinic), lab tests, or X-rays, without a formal inpatient admission
  (even if you spend the night in the hospital).

You or a family member should ask daily if you or your loved one is an inpatient or an outpatient. As we learned above, you might be considered an outpatient while the doctors keep you in the hospital for observation. Do not assume that you’re inpatient simply because you have a hospital stay!

Tom, since your mother was not “formally admitted, ” she did not meet the Skilled Nursing requirements, and Medicare will not pay under Part A. If your mother is struggling to pay the bill, she has a few different options. Contact the hospital or skilled nursing facility about financial assistance programs. There is also a Medicare Savings Programs that may be able to assist your mother if she meets the requirements. Visit Medicare’s website for more information about the program, requirements, and whether or not your mother can apply.

Now seems like a good time to remind my readers of one very simple truth—what you don’t know WILL hurt you! Always do your research, and if you ever have a Medicare-related question, I’m here for you! Call my hotline at 832-519-8664 or email [email protected] for Medicare help.

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