Coverage
What Medicare covers for a hospital stay (and why "observation" matters)
You can spend a night in a hospital bed and still not be an "inpatient" in Medicare's eyes. That one word changes what you pay and whether Medicare covers a nursing facility afterward. Here's how hospital coverage works, and the questions to ask while you're there.
Last reviewed October 27, 2026. General information, not advice about any plan.
What Part A covers
- Covered
- A semi-private room, meals, general nursing, drugs that are part of your treatment, and other hospital services and supplies.
- Not covered
- A private room (unless medically necessary), private-duty nursing, a TV or phone with a separate charge, and personal items like razors or slipper socks.
- Your doctors
- Doctor services in the hospital are Part B: usually 20% of the Medicare-approved amount after the Part B deductible.
What you pay in 2026
- Deductible
- $1,736 per benefit period. A benefit period ends after you've been out of the hospital and skilled nursing care for 60 days in a row, so you can pay it more than once a year.
- Days 1 to 60
- $0 after the deductible.
- Days 61 to 90
- $434 a day.
- After day 90
- $868 a day for up to 60 lifetime reserve days, which never renew. After that, all costs.
- Psychiatric hospitals
- Care in a freestanding psychiatric hospital has a 190-day lifetime limit. Psychiatric units in general hospitals don't.
Inpatient or under observation?
You're an inpatient only once a doctor writes an order formally admitting you. Doctors generally admit you when they expect you to need hospital care for at least two midnights. Before that, in the ER or "under observation," you're an outpatient, even overnight.
- What you pay as an outpatient
- Part B copays for each hospital service, plus 20% for doctors. Pills you normally take yourself usually aren't covered by Part B in the hospital; your drug plan may cover some, but you may have to pay first.
- Nursing facility care afterward
- In most cases, Medicare covers a skilled nursing facility only after 3 inpatient days. Observation and ER time don't count. How the 3-day rule works.
- The observation notice
- If you're in observation for more than 24 hours, the hospital must give you a Medicare Outpatient Observation Notice (MOON) within 36 hours and explain it to you.
- Ask every day: "Am I an inpatient or an outpatient?" It's your right to know, and it affects what you pay.
Notices and appeal rights
- An Important Message from Medicare
- Given within 2 days of admission, and again before you leave. It explains your right to appeal a discharge you think is too soon.
- Appealing a discharge
- Call the reviewer listed on the notice (your state's BFCC-QIO) no later than the day you're scheduled to leave. You can stay while they decide, generally without extra charges. How appeals work.
- Changed from inpatient to observation
- Since February 14, 2025, in Original Medicare: if you didn't have Part B, or you were in the hospital 3 or more days but an inpatient for fewer than 3, the hospital must give you a Medicare Change of Status Notice before you leave (ask for it if you don't get one). You can ask the BFCC-QIO for a fast review, ideally before you leave.
Medicare Advantage and Medigap
- Medicare Advantage
- Plans cover the same hospital care but set their own costs, often a copay for each day, and may require approval first and a network hospital except in emergencies. Since 2024 they must follow Medicare's two-midnight rule for admissions. Your yearly out-of-pocket limit caps the total.
- Medigap
- Every Medigap plan covers the hospital coinsurance plus 365 extra hospital days. Most cover the deductible too; Plan A doesn't, and K, L and M cover part.
Common questions
What is the Medicare hospital deductible in 2026?
$1,736 for each benefit period. Days 1 to 60 then cost nothing more, days 61 to 90 cost $434 a day, and lifetime reserve days cost $868 a day.
What is observation status?
Hospital care you get as an outpatient while doctors decide whether to admit you. Even overnight, you're not an inpatient until a doctor formally admits you. Part B covers it, with copays, and the time doesn't count toward Medicare's 3-day rule for nursing facility care.
How do I know if I'm an inpatient?
Ask the hospital staff or your doctor each day. If you're in observation for more than 24 hours, the hospital must give you a Medicare Outpatient Observation Notice explaining it.
Can I appeal being changed from inpatient to observation?
In Original Medicare, yes, for hospital stays since February 14, 2025, if you didn't have Part B or you were in the hospital 3 days or more but an inpatient for fewer than 3. Ask the reviewer before you leave if you can; you can still appeal after you go home by following the notice.
Keep reading
- Does Medicare cover nursing home care? Skilled nursing vs. long-term careMedicare covers short-term skilled nursing facility care after a qualifying hospital stay, up to 100 days, but not long-term nursing home care. The 3-day rule, 2026 costs, and what to do when coverage ends.
- What Medicare covers for mental health careTherapy, counseling, psychiatric care, telehealth from home, intensive programs, hospital stays and medications: what Medicare covers for mental health, who can treat you, and what it costs in 2026.
- How to appeal a Medicare denial: steps and deadlinesYour plan or Medicare said no. The first step and its deadline for Original Medicare, Medicare Advantage and Part D, fast appeals when care is ending, the 2026 prior-authorization deadlines, and who can help for free.
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