Hospital Inpatient or Outpatient? Know the Difference!

Did you know that even if you stay in a hospital overnight, you might still be considered an “outpatient?” Your hospital status (whether the hospital considers you an “inpatient” or “outpatient”) affects how much you pay for hospital services (like X-rays, drugs, and lab tests) and may also affect whether Medicare will cover care you get in a skilled nursing facility (SNF) following your hospital stay.

  • You’re an inpatient starting when you’re formally admitted to a hospital with a doctor’s order. The day before you’re discharged is your last inpatient day.
  • You’re an outpatient if you’re getting emergency department services, observation services, outpatient surgery, lab tests, X-rays, or any other hospital services, and the doctor hasn’t written an order to admit you to a hospital as an inpatient. In these cases, you’re an outpatient even if you spend the night at the hospital.

The “outpatient” classification is often a surprise to patients; many do not realize their status until the patient is getting ready to leave the hospital. Hospital patients are often not told or given a written notice when they are designated as outpatients on Observation Status, although the NOTICE Act now requires hospitals to inform patients, both orally and in writing, when they are in observation status.

Why Does Observation Status Matter?

When hospital patients are classified as outpatients on Observation Status, they may be charged for services that Medicare would have paid if they were formally and officially admitted as inpatients. For example, patients may be charged for their medications. Most significantly, patients will not be able to obtain any Medicare coverage if they need nursing home care after their hospital stay. Medicare only covers nursing home care for patients who have a 3-day inpatient hospital stay – Observation Status doesn’t count towards the 3-day stay.

Even if Medicare patients who have both Medicare Parts A and B, may be responsible for 20% of their hospital bill, which is covered under Part B, if they are considered outpatients..

If you are not sure of your status, while in the hospital, ASK!