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 Important Resources


 Residents and Families


​Has your loved one been impacted by observation stays?

Share your story with us. Please be sure to fill out the release form.


 AHCA/NCAL Members


​Have observation stays impacted your residents and patients?

Contact Us and help us close this observation stay loophole.

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 Press Releases


Skilled nursing care centers serve our most vulnerable citizens – frail elders and those with disabilities who need complex medical, rehabilitative, and restorative care, 24 hours a day, 7 days a week. But under the current Medicare law, thousands are not receiving critical nursing care and getting stuck with high medical bills after leaving the hospital.  

Hospital patients must be classified as an inpatient for at least three consecutive days in order for Medicare to pay for rehabilitation care in a skilled nursing care center. However, hospitals are increasingly holding patients under “observation,” an outpatient designation, rather than admitting them as inpatients. As a result, outpatients who need follow-up care do not qualify for Medicare coverage in a nursing center, leaving those in need of critical care on their own or in debt with thousands in out-of-pocket costs.

The American Health Care Association and National Center for Assisted Living (AHCA/NCAL) continues to keep the observation stays issue one of its top advocacy priorities and supports legislation that will fix this confusing policy.

Learn more about the observation issue here and the impact on Medicare beneficiaries here and here.

Observation Stays in the National Spotlight

Last week, NBC Nightly News and MSNBC featured segments that continue to shine a spotlight on the observation stays issue. For both stories, National Correspondent Kate Snow, reported on the impact of Medicare’s current law that leaves thousands of beneficiaries stuck with high medical bills after leaving the hospital if skilled nursing care services are needed. And on MSNBC, Snow interviewed Representative Joe Courtney (D-CT) about his bipartisan legislation that will help fix the current policy. The MSNBC video with Rep. Courtney discusses the Improving Access to Medicare Coverage Act. The NBC Nightly News segment with Lester Holt discusses the importance of knowing your hospital status before being discharged.

The American Health Care Association/National Center for Assisted Living (AHCA/NCAL) continue to keep the observation stays issue one of its top advocacy priorities. To learn more about observation stays, visit our website here.

Lawmakers, Advocates Push For Observation Status Reform
The South Florida Sun Sentinel reported lawmakers and advocacy groups in both Florida and nationally are pushing for "observation status" reform. The groups are concerned that a growing number of seniors admitted to hospitals receive "larger-than-expected hospital bills due to" Medicare not covering some benefits of patients classified as "under observation." The designation has increased in use "from 932,000 [days] in 2006 to almost 1.9 million in 2014," partially due to "Medicare’s ‘two-midnight’ rule, implemented in October 2013, that stated many patients expected to stay in the hospital fewer than two nights should be under observation instead of admitted as inpatients." For more information about observation stays, visit the AHCA/NCAL website.

Medicare Outpatient Observation Notice (MOON) Implementation Manual Instructions Now Available
Dana Halvorson

According to a February 10, 2017, email from the Centers for Medicare & Medicaid Services (CMS), manual instructions regarding implementation of the Medicare Outpatient Observation Notice (MOON) are now available on the CMS website. The new manual instructions provide more specific detail on notice delivery and are available online.

CMS released the MOON, along with its form instructions, December 2016. The MOON is a standardized notice to inform beneficiaries (including Medicare health plan enrollees) that they are an outpatient receiving observation services and are not an inpatient of the hospital or critical access hospital (CAH). Outpatient status affects a patient’s ability to receive Medicare coverage for post-acute care in a skilled nursing center. The MOON is mandated by the Notice of Observation Treatment and Implication for Care Eligibility Act (NOTICE Act) enacted on August 6, 2015. AHCA/NCAL supports the NOTICE Act law. The NOTICE Act requires all hospitals and CAHs to provide written and oral notification under specified guidelines. Hospitals and CAHs must begin using the MOON no later than March 8, 2017. For questions concerning the MOON, please send an email to: