After a Hospital Stay: Medicare’s Rehab and Skilled Nursing Rules

It usually happens fast. Your parent falls, or has pneumonia, or gets a new hip. A few days later, someone from the hospital says they’re ready to go, but not home. They need rehab first.

That’s when families run into Medicare’s skilled nursing rules, and some of them can cost thousands of dollars if nobody explains them. This guide walks through what Medicare covers after a hospital stay, the traps to watch for, and the questions to ask before your parent leaves the hospital.

These rules apply to Original Medicare. If your parent has a Medicare Advantage plan, the rules can be different. More on that below.

The short version

• Medicare Part A can cover up to 100 days in a skilled nursing facility (SNF) for rehab or skilled care.
• To qualify, your parent usually needs a 3-day inpatient hospital stay first. Observation days don’t count.
• Days 1–20: Medicare pays in full.
• Days 21–100: Your parent pays a daily coinsurance of $217 per day in 2026.
• After day 100: Medicare pays nothing for that benefit period.
• Coverage only continues while your parent needs and is getting skilled care and is improving or needs skilled care to stay stable. It’s not automatic for 100 days.

The 3-day rule, and the observation status trap

To get Medicare coverage in a skilled nursing facility, your parent generally needs to have been formally admitted as a hospital inpatient for at least three days in a row, not counting the day of discharge.

Here’s the catch: a patient can spend several nights in a hospital bed and still never be admitted. Hospitals often place people under observation status, which Medicare treats as outpatient care. Observation days don’t count toward the 3-day requirement.

So your parent could spend four nights in the hospital, be sent to rehab, and find out Medicare won’t pay because they were never technically admitted.

What to do:

• Ask early and ask often: "Is my parent admitted as an inpatient, or under observation?"
• Watch for the Medicare Outpatient Observation Notice (MOON). Hospitals are required to give it to patients who've been under observation for more than 24 hours. If your parent got one, they're not an inpatient.
• If your parent is under observation, ask the doctor whether inpatient admission is medically appropriate, and ask what that means for rehab coverage.
• Ask the hospital case manager or discharge planner to explain exactly how the stay is classified.

Some people who were placed under observation can appeal in certain situations. If this happens, contact Illinois SHIP at 1-800-252-8966 for free help.

What “skilled care” means

Medicare covers SNF care when your parent needs skilled services daily, such as:

• Physical, occupational, or speech therapy
• Wound care
• IV medications or injections
• Monitoring after surgery or a serious illness

It does not cover a SNF stay just for custodial care: help with bathing, dressing, eating, or using the bathroom. That’s the line that ends coverage for many families. When your parent stops needing daily skilled care, Medicare coverage stops, even if they still can’t safely go home.

The 100 days aren’t guaranteed

Families often hear “Medicare covers 100 days” and plan around that. In reality, many rehab stays end well before day 100 because the facility decides your parent no longer needs skilled care.

You should get a written notice, usually a Notice of Medicare Non-Coverage, at least two days before covered services end.

If you disagree, appeal right away. The notice explains how. Appeals for SNF discharges go to a Medicare review contractor (called a BFCC-QIO) and are usually decided quickly. Your parent can usually stay while the fast appeal is reviewed.

Also important: Medicare coverage doesn’t require that your parent keep improving. If skilled therapy is needed to maintain their condition or slow decline, it can still be covered.

What it costs in 2026

There’s also the Part A hospital deductible: $1,736 per benefit period in 2026, for the hospital stay itself.

A 30-day rehab stay can mean about $2,170 in coinsurance for days 21–30. A Medigap (Medicare Supplement) plan often covers some or all of that coinsurance. Check your parent’s plan.

For 2027 numbers, see our Medicare 2027 costs page.

If your parent has Medicare Advantage

Medicare Advantage plans must cover SNF care, but they can:

• Waive the 3-day hospital stay requirement (many do)
• Require prior authorization before admission
• Limit you to facilities in their network
• Set different copays from Original Medicare

Call the plan before discharge and ask: Is prior authorization approved? Which facilities are in network? What will my parent pay per day? Open Enrollment, which runs through December 7, is a good time to compare these rules if your parent is choosing a plan. See our Medicare Open Enrollment guide.

Choosing a rehab facility

You usually don’t have much time, so prepare a short list early.

• Check ratings on Medicare's Care Compare tool (medicare.gov/care-compare)
• Ask the hospital for the list of facilities with open beds, and don't feel pressured to take the first one
• Confirm the facility accepts your parent's Medicare plan
• Ask how much therapy your parent will get each day, and on weekends
• Ask about discharge planning: who coordinates home care, equipment, and follow-up

Planning for what comes after

Rehab is temporary. Start thinking about what happens next while your parent is still there.

• Going home with help: Medicare home health may cover short-term skilled care at home. Ongoing help with daily tasks isn’t covered by Medicare, but Illinois’ Community Care Program may help. See in-home care vs. home health care and our guide to choosing home care.
• Making the house safer: Our Aging in Place guide covers the most important changes. A medical alert system is worth considering after a fall.
• Not able to go home: If your parent can’t live alone anymore, see our guide to the Illinois Supportive Living Program and our Assisted Living topic page.
• Paperwork: A hospital stay is a wake-up call to make sure power of attorney documents are in place.

Questions to ask before discharge

• Was my parent admitted as an inpatient? For how many days?
• Did my parent receive a MOON notice?
• What skilled care does my parent need after discharge, and for about how long?
• Which facilities have openings and accept my parent's plan?
• (Medicare Advantage) Has prior authorization been approved?
• What will my parent pay per day, and starting when?
• Who do I call if I disagree with the discharge plan?

FAQ

This guide is general information, not medical or legal advice. Medicare rules and dollar amounts change each year. 2026 figures last verified October 2026 against CMS.