Mother in law went to ED on Friday, family was not informed until 4 days later she was in observation. What can we do?

due to not being classified inpt., medicare will not pay on next level of care since she was not in the hospital as inpt. What can we do? It's very disturbing that the hospital did not give this information to us. This will also result in a large co-pay for the time she has been in the hospital. She is to be discharged today (after five nights in the hospital). Any direction on this would be greatly appreciated.