Your hospital status does affect how much you pay for hospital services, such as X-rays, medications, and any tests that the doctor deems necessary. Your hospital level may also affect whether Medicare will cover the care that you receive. You are an inpatient when you are officially admitted to the hospital at the doctor's request.
You are an outpatient if you are receiving emergency department services, observation services, or any other sort of service that the hospital may provide. Certain situations depend on whether the situation calls for extended care, which would entail being an inpatient in the hospital.
For example, if you come to the emergency room with chest pain, the hospital keeps you for two nights. One night is expended in observation, and the doctor writes an order for inpatient admission the following day. Medicare coverage part A pays for the hospital stay and all services provided at the doctor's charge, while Medicare part B pays for your doctor services.