DAL 17-07 - The Medicare Outpatient Observation Notice (MOON)

April 12, 2017

DHDTC DAL 17-07: The Medicare Outpatient Observation Notice (MOON)

Dear Chief Executive Officer:

Beginning March 8, 2017, hospitals are required to issue the Medicare Outpatient Observation Notice (MOON) to Medicare beneficiaries to advise them that they have been assigned to observation status (https://www.cms.gov/Medicare/Medicare-General-information/Bni/). The Centers for Medicare and Medicaid Services (CMS) published full instructions for completion of the MOON on January 20, 2017, located at the following link: https://www.cms.gov/Medicare/Medicare-General-Information/BNI/Downloads/CR9935-MOON-Instructions.pdf. These instructions affirm that CMS allows states with state observation notice requirements to either:

  • Supplement the MOON's "Additional Information" section to communicate additional content required under state law, or
  • Attach the notice required under state law to the MOON.
  • Hospitals that opt to augment the "Additional Information" section of the MOON must comply with CMS' MOON instructions pertaining to modifications, specifically sections 400.3.1 and 400.3.8 of the Medicare Claims Processing Manual, in addition to state requirements, outlined in the attached letter dated January 13, 2014. The New York State Department of Health also recommends including contact information of hospital personnel who could assist a patient to better understand the content related to observation services.

    In accordance with Public Health Law Section 2805-w and 10 NYCRR Section 405. 32(b)(4), New York State hospitals are required to give an observation notice to all patients within 24 hours of their assignment to observation status, regardless of the patient's payer. While the MOON instructions allow a 36-hour time frame to provide the notice to Medicare beneficiaries, New York State law and regulation require all notices of observation status, including the MOON, to be given within 24 hours of the patient's assignment to observation. Hospitals in New York State must follow the more stringent requirement and provide the notice within 24 hours.

    Should you have any questions, please call the Division of Hospitals and Diagnostic & Treatment Centers at 518-402-1004.


    Ruth Leslie
    Division of Hospitals and Diagnostic & Treatment Centers