CMS posts Medicare Outpatient Observation Notice

The Centers for Medicare & Medicaid Services (CMS) has posted an updated version of the Medicare Outpatient Observation Notice (MOON), which all Hospitals and Critical Access Hospitals (CAHs) must provide to all Medicare beneficiaries who receive outpatient observation services for more than 24 hours effective March 6, 2017.


Under the Notice of Observation Treatment and Implication for Care Eligibility Act, hospitals must provide oral and written notice to beneficiaries within 36 hours after observation services are initiated, or sooner if the individual is transferred, discharged or admitted as an inpatient. The notice informs them that they are an outpatient receiving observation services, not an inpatient, and the associated implications for cost-sharing and eligibility for Medicare coverage of skilled nursing facility services.

CMS issued the final policies for implementing the NOTICE Act in August with the Inpatient Prospective Payment System (IPPS) final rule, but delayed implementation until 90 days after the updated Medicare Outpatient Observation Notice was posted on the CMS website.

The CMS released a copy of the MOON and its accompanying instructions. CMS notes that manual instructions will be made available in the coming weeks. See the Notice of Instructions and Outpatient Observation Notice.