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Medicare Part A ‘hospital insurance’ – coverage of inpatient care

Inpatient coverage from hospital beds to hospice care

Louise Norris

No one plans to end up in the hospital, but it’s reassuring for millions of enrollees to know that Medicare Part A covers so much of hospitalization expenses. It’s also comforting to know that most folks who are eligible for Medicare do not have to pay a premium for Medicare Part A, thanks to the payroll taxes they (or their spouse) paid during their working years.

What is Medicare Part A?

Part A coverage – or “hospital insurance” – pays for a broad range of inpatient care in hospitals, skilled nursing facilities, and critical access hospitals. And, while it does not cover long-term custodial care, Medicare Part A does cover some home health care and hospice services.

What does Medicare Part A cover?

The list of expenses covered by Medicare Part A includes:

  • Hospital inpatient care, including a semi-private room (unless a private room is medically necessary), meals, and prescription drugs that are administered while you’re an inpatient.
  • Inpatient care in a skilled nursing facility (for coverage to be provided for the skilled nursing facility stay, Original Medicare requires a three-day inpatient hospital stay prior to the skilled nursing facility stay; it’s important to understand that observation status is not the same thing as inpatient status, and that Medicare does not cover long-term care for people who only need assistance with the activities of daily living).
  • Hospice care and home health care services when medically necessary (home health care includes intermittent skilled nursing, physical therapy, speech-language pathology, some medical supplies and equipment, but not assistance with daily living if that’s the only care you need, as that would be categorized under long-term care).
  • Inpatient care in a religious non-medical health care institution.
  • Blood – If no free blood bank blood is available, Part A pays for the patient’s blood needs after the enrollee pays for the first three units (all of the standardized Medigap plans cover at least some of the cost of the first three pints of blood, and most of them cover the full cost).
  • Inpatient mental health care (if it’s in a psychiatric facility, coverage is limited to 190 days in the enrollee’s lifetime).

How do I enroll in Medicare Part A?

If you are already receiving Social Security or Railroad Retirement Board benefits, the government automatically enrolls you in Medicare Part A at no cost when you reach 65. Look for your Medicare card to automatically arrive in the mail three months prior to your 65th birthday (or the 25th month of a disability, as you become eligible for Medicare after two years of being disabled and receiving Social Security Disability benefits).

When do I enroll in Medicare Part A?

Individuals who are not automatically enrolled in Medicare Part A have a seven-month window of time to enroll, beginning three months prior to the month they turn 65.

If you’re not eligible for premium-free Medicare Part A and you delay your enrollment until after the seven-month window surrounding your 65th birthday, you’ll be subject to additional premiums for Part A and will likely need to wait until the General Enrollment Period to sign up. (Most people are eligible for premium-free Part A, but if you or your spouse haven’t paid at least ten years of payroll taxes, you’d have to pay for Medicare Part A; to qualify for premium-free Medicare based on your spouse’s work record, your spouse has to be at least 62 years old.)

Regardless of age, individuals diagnosed with ALS receive their Medicare Part A card through the mail the month their disability benefits begin (and there is no longer a five-month waiting period for disability benefits to begin after an ALS diagnosis). People with end-stage renal disease (kidney failure) are also eligible for Medicare coverage, starting either the fourth month of dialysis or, if the patient enrolls in a home dialysis program, the first month of dialysis.

What does Medicare Part A cost?

How much you pay for Medicare Part A coverage depends on your work history. If you or your spouse worked and paid into Medicare through payroll taxes for at least 40 quarters (10 or more years), you pay nothing each month for Medicare Part A (if you’re qualifying based on your spouse’s work record, your spouse must be at least 62 years old — if not, you have to pay for Medicare Part A even if your spouse paid payroll taxes for 10+ years).

There are some requirements to be aware of in terms of the length of the marriage if you’re enrolling based on your spouse’s work history. Also, since the Defense of Marriage Act was ruled unconstitutional in 2013, the Social Security Administration has begun processing premium-free Medicare A enrollments based on the work history of enrollees’ same-sex partners.

If you or your spouse worked and paid into Medicare for between 7.5 and 10 years, you’ll pay $278 a month for Medicare Part A in 2023 and 2024. If the work history was less than 7.5 years, the premium is $506 a month in 2023, and drops to $505/month in 2024. These amounts generally increase modestly each year, but remained flat and slightly decreased for 2024.

Who doesn't have to pay a premium for Medicare Part A?

If you are 65 and you or your spouse has paid Medicare taxes for at least 10 years, you don’t pay a premium for Part A.

You may also not have to pay the premium:

  • If you haven’t reached age 65, but you’re disabled and you’ve been receiving Social Security benefits or Railroad Retirement Board disability benefits for two years.
  • You have end-stage renal disease (ESRD) and are receiving dialysis, and either you or your spouse or parent (if you’re a dependent child) worked and paid Medicare taxes for at least 10 years. Coverage typically begins the first day of your fourth month of dialysis, but it can begin in your first month of dialysis if you use in-home dialysis treatment.
  • You have amyotrophic lateral sclerosis (ALS) and are eligible for Social Security Disability Insurance (SSDI). Medicare coverage begins as soon as your SSDI begins, and Medicare Part A has no premiums as long as you or your spouse (or parent, if you’re a dependent child) worked and paid Medicare taxes for at least 10 years.

How much of my inpatient healthcare charges will Medicare Part A cover?

Medicare Part A pays the majority of the Medicare-approved charges for inpatient health care services. However, you must pay a deductible ($1,600 in 2023; increasing to $1,632 in 2024) for each benefit period. Note that this isn’t the same as deductibles on most other types of health insurance, as the deductible is for each benefit period rather than each year.

And there are per diem copays that apply to extended hospital stays. If your hospitalization lasts more than 60 days in 2023, you’ll pay $400 per day for days 61 through 90, in addition to the deductible you already paid for that benefit period (if you are discharged from the hospital before the 61st day, you only pay the deductible). For 2024, this per diem charge increases to $408 for days 61 through 90.

If you’re hospitalized for longer than 90 days, you have 60 lifetime reserve days that you can use — during those days, you’ll pay $800 per day in 2023 (increasing to $816 per day in 2024). Once the reserve days are used up, Medicare doesn’t pay any additional charges during that benefit period (a benefit period begins on the day you’re admitted to the hospital, and ends when you’ve been out of the hospital for 60 days).

It’s rare for beneficiaries to be hospitalized more than 60 days, but not unheard of — which is why a Medigap supplement is an important part of full medical coverage in retirement, for people who don’t have supplemental coverage from an employer-sponsored plan or Medicaid.

Medigap supplements are important even for beneficiaries with more modest medical needs, as most of the available plans will cover some or all of the Medicare Part A deductible, as well as the per-day costs that would otherwise have to be paid for an extensive hospital stay. Medigap plans also pick up a large portion of the out-of-pocket costs that beneficiaries would otherwise have to pay for services covered by Medicare Part B.

Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

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