Rehab denied after a hospital stay? Here's what the government found, and what to do

A government watchdog, the Office of Inspector General (OIG) at the Department of Health and Human Services (HHS), studied prior-authorization requests for skilled nursing facility (SNF) admission in June 2024 at 19 Medicare Advantage (MA) companies. Prior authorization means the plan has to approve the stay before it’s covered. The finding, published in 2026: of the denials that were appealed, 95% were overturned in the enrollee’s favor.

Maybe that’s your family right now. Mom is finishing a hospital stay. The doctor says she needs a few weeks of rehab in a skilled nursing facility before she can safely go home. Then the MA plan says no. Or she’s already in rehab, and someone hands you a form saying her coverage ends Thursday.

Stat card: HHS OIG, report OEI-09-24-00331 (2026)

Population: prior-authorization requests for skilled nursing facility admission, June 2024, 19 Medicare Advantage organizations.

12% of requests were denied

Only 18% of those denials were appealed (by enrollees or their providers)

95% of appealed denials were overturned in the enrollee’s favor

naviHealth (a UnitedHealth Group subsidiary) processed half of all the requests and denied 14%. 97% of its denials that were appealed were overturned.

Here’s the catch: more than 4 out of 5 denials in that study were never appealed. The numbers don’t promise anything about one person’s case. They do show that a “no” from the plan is often not the final answer.

One more distinction: this report covered skilled nursing facilities only. It did not cover inpatient rehabilitation facilities, the rehab hospitals that provide intensive therapy. A separate OIG report found that appealed denials for those facilities were overturned much less often. The 95% figure doesn’t carry over to them.

There are two very different situations here, with different clocks and different people to call. Figure out which one you’re in first.

1. Situation A: the plan won’t approve the rehab stay (Medicare Advantage)

This happens before admission. The hospital asks the MA plan to approve a skilled nursing facility stay, and the plan denies it.

What to do:

Ask for a fast (“expedited”) appeal, not a standard one. Medicare.gov says the plan must decide within 72 hours if it determines, or your doctor tells the plan, that waiting for a standard decision may seriously jeopardize your life, health, or ability to regain maximum function.
Get the doctor on board. When a doctor tells the plan that waiting could seriously jeopardize the patient’s health or recovery, the plan must use the fast track. Ask the hospital doctor or the case manager to call or write the plan today.
Get the specific reason in writing. The plan’s written denial notice must explain why it said no. Since 2026, plans must also give the provider a specific reason when they deny a prior-authorization request. “Not medically necessary” by itself tells you little. Ask what records or criteria the plan relied on. Then have the doctor answer that exact reason.
Know the outer deadline. You have 65 days from the date on the denial notice to ask for this appeal (called a “reconsideration”). With rehab, though, every day matters, so ask the same day you get the “no.”

Worth knowing: your first appeal goes back to the plan itself. In the OIG study, the plans overturned most of their own denials once someone appealed. If the plan upholds its denial, it must automatically send your case to an outside reviewer, the Independent Review Entity (IRE).

2. Situation B: already in rehab and told coverage is ending (both tracks)

This is the “they’re kicking Mom out of rehab” moment. Families often call it an unsafe discharge. The facility, or the MA plan through the facility, has decided skilled care is no longer needed.

The key document is the Notice of Medicare Non-Coverage. You should get it at least 2 days before covered services end. If you don’t get one, ask for it.

What to do:

Find the end date on the notice. The appeal goes to the reviewer listed on the notice, the Beneficiary and Family Centered Care Quality Improvement Organization (BFCC-QIO). The notice’s own words: “Ask for the appeal as soon as possible. You must ask for a timely appeal no later than noon of the day before“ that end date. Don’t wait for the deadline. Call as soon as you have the notice.
This works in both Original Medicare and Medicare Advantage. The BFCC-QIO is an independent reviewer. It is not the facility and not the plan.
Who pays while it’s reviewed: the notice says services continue during the appeal. Medicare.gov says that if you ask on time, you won’t be responsible for paying for skilled nursing facility services provided before the coverage end date on the notice. If the reviewer agrees coverage should end and your parent stays past that date, you may have to pay for those extra days.
When you’ll hear back: the notice says the reviewer will decide as soon as possible. In Original Medicare, that’s generally no later than two days after the end date. In a Medicare Advantage plan, it’s generally by the end date.
If you miss the noon deadline: you may still have appeal rights, but the no-charge rule above doesn’t apply, and you could owe more.

Action step: Tape the BFCC-QIO phone number from the notice inside your notebook cover. You may need it fast. Our skilled nursing discharge appeal guide walks through the notice step by step.

3. Original Medicare notes: three rules that trip families up

If your parent has Original Medicare (not an MA plan), there’s usually no prior-authorization step for the rehab stay itself. Coverage depends on these rules instead:

The 3-day rule. Original Medicare generally covers a skilled nursing facility stay only after a medically necessary inpatient hospital stay of at least 3 days in a row. The day of admission as an inpatient counts. The day of discharge doesn’t.
Observation days don’t count. Time spent “under observation” or in the emergency room before admission isn’t inpatient time, even if your parent spent nights in a hospital bed. Ask the hospital early and often: “Is she inpatient or observation?”
Up to 100 days, only while skilled care is needed. Coverage runs up to 100 days per benefit period, and only while your parent needs daily skilled care, like physical therapy. It’s not an automatic 100 days. Days 21 through 100 have a daily coinsurance.

MA plans may waive the 3-day rule, but they usually need to approve the stay first. That brings you back to Situation A.

4. Caregiver tips that make every step easier

Get appointed as the representative. Form CMS-1696, “Appointment of Representative,” lets a family member act for your parent in an appeal. Both of you sign it. MA plans may also have their own form. At a minimum, get your name on the facility’s HIPAA authorization so staff can talk with you.
Keep a notebook. Write down every call: the date, time, person’s name, and what they said. Staff change from shift to shift. Your notes don’t.
Ask the discharge planner for everything in writing. That includes the Notice of Medicare Non-Coverage, the plan’s denial letter, and the reason care is ending. A verbal “insurance won’t cover it” is not a notice.
Ask the doctor what your parent still needs. “Can she safely walk to the bathroom alone?” is the kind of plain question that belongs in an appeal.

What to do this week

[ ] Find out: Original Medicare or a Medicare Advantage plan?
[ ] Ask the hospital: “Inpatient or observation?”
[ ] Denied before admission? Request a fast appeal and ask the doctor to support it.
[ ] Given a Notice of Medicare Non-Coverage? Call the BFCC-QIO right away, and no later than noon the day before the end date.
[ ] Sign Form CMS-1696, or at least the HIPAA authorization.
[ ] Start the notebook.

Bottom line: A rehab denial is a starting point, not a verdict. In the OIG study of skilled nursing admission denials, few were appealed, and most of those that were got overturned. Know which situation you’re in, move fast, and get it in writing.

Got a denial or a confusing notice? Upload it to Medterpret and see what it says, what it means, and what to do next, in plain English. Medterpret drafts your appeal document and calculates your deadline; you decide what to send. Appeal a denial →

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Medterpret is independent and not affiliated with or endorsed by Medicare, CMS, HHS, or any government agency. Educational information, not legal or medical advice.

More: Medicare Advantage · Original Medicare · Skilled nursing discharge appeals

Sources

HHS Office of Inspector General, Medicare Advantage Organizations Overturned Nearly All Appealed Prior Authorization Denials for Skilled Nursing Facility Admission, Raising Concerns About Initial Denials (OEI-09-24-00331), June 2026 — oig.hhs.gov
HHS Office of Inspector General, The Three Largest Medicare Advantage Organizations Denied Requests for Long-Term Acute Care and Inpatient Rehabilitation at Some of the Highest Rates (OEI-09-24-00330), June 2026 — oig.hhs.gov
Medicare.gov (CMS), “Fast appeals,” accessed Sept. 29, 2026 — medicare.gov
Medicare.gov (CMS), “Appeals in Medicare health plans,” accessed Sept. 29, 2026 — medicare.gov
Medicare.gov (CMS), “Skilled nursing facility care,” accessed Sept. 29, 2026 — medicare.gov
CMS, Medicare Appeals (CMS Product No. 11525), April 2026 — medicare.gov
CMS, “FFS & MA NOMNC/DENC” (Notice of Medicare Non-Coverage, Form CMS-10123, and instructions), accessed Sept. 29, 2026 — cms.gov
CMS, “CMS Interoperability and Prior Authorization Final Rule (CMS-0057-F)” fact sheet, Jan. 17, 2024 — cms.gov
CMS, Form CMS-1696, “Appointment of Representative” — cms.gov
42 CFR § 405.1202, “Expedited determination procedures” (Original Medicare), via Cornell Legal Information Institute — law.cornell.edu
42 CFR § 422.626, “Fast-track appeals of service terminations” (Medicare Advantage), via Cornell Legal Information Institute — law.cornell.edu