H.R. 3954 — Improving Access to Medicare Coverage Act of 2025

This section deems a period of outpatient observation services in a hospital as an inpatient stay for purposes of the three-day prior inpatient hospital stay requirement for Medicare coverage of post-hospital extended care services (i.e., skilled nursing facility (SNF) services). (As background, Medicare Part A covers SNF services only after a beneficiary has at least three days as a hospital inpatient; thus, this change addresses prior limitations where outpatient observation services—often used for similar monitoring—did not count toward that threshold, with the end of observation treated as the hospital discharge date unless the individual is admitted as an inpatient.) The provision applies to observation services furnished on or after January 1, 2026, and to certain previously completed SNF services if an administrative appeal is filed within 90 days of enactment; the Secretary of Health and Human Services may implement via interim final regulation or otherwise.