Counting a period of receipt of outpatient observation services in a hospital toward the 3-day inpatient hospital requirement for coverage of skilled nursing facility services under Medicare

(a) In general Section 1861(i) of the Social Security Act (42 U.S.C. 1395x(i)) is amended by adding at the end the following: For purposes of this subsection, an individual receiving outpatient observation services shall be deemed to be an inpatient during such period, and the date such individual ceases receiving such services shall be deemed the hospital discharge date (unless such individual is admitted as a hospital inpatient at the end of such period).. (b) Effective date The amendment made by subsection (a) shall apply to receipt of outpatient observation services beginning on or after January 1, 2026, but applies to a period of post-hospital extended care services that was completed before the date of the enactment of this Act only if an administrative appeal is or has been made with respect to such services not later than 90 days after the date of the enactment of this Act. Notwithstanding any other provision of law, the Secretary of Health and Human Services may implement such amendment through an interim final regulation, program instruction, or otherwise.