Medicare can feel a little overwhelming to navigate. That's because it isn't just one program — instead, the government breaks it down into parts, each of which covers different types of health care. Medicare Part A, also known as hospital insurance, is just one of them.
What does Medicare Part A cover? Here's what hospital insurance entails.
How Does Medicare Part A Compare With Other Parts?
Medicare Part A covers the "room and board" charges of staying in a hospital as well as other health care facilities such as ones for skilled nursing care. This coverage also includes medical procedures you undergo while you're in these facilities. Medicare Part B covers outpatient care when you don't stay in the hospital. For instance, many visits to the doctor, preventive screenings and surgeries do not require an overnight stay.
Medicare Part C, also known as Medicare Advantage, is a private health insurance program that works as an alternative to traditional Medicare. This private insurance plan offers similar coverage to Part A and Part B. Some companies also include prescriptions drugs as part of their Medicare Advantage plans.
Additionally, Medicare Part D is dedicated to covering prescription drugs. Medicare parts A and B may cover drugs during a hospital stay or as part of a procedure, but you would need Part D to cover your prescriptions while at home.
What Does Medicare Part A Cover?
Medicare Part A focuses on the costs of staying in different medical facilities. The main areas it covers include:
- Inpatient care at a hospital
- Skilled nursing facility care
- Nursing home care (aside from custodial or long-term care)
- Hospice care
- Certain home health services, like physical therapy, as well as part-time home health aide services when you are recovering from an illness or injury
While you're staying in these facilities, Medicare Part A helps pay for the cost of a semiprivate room, your meals and needed medical supplies. It can also cover some other health care expenses in a facility, such as your nursing care, drugs you need at the hospital and physical therapy at a skilled nursing facility.
Although Medicare Part A can cover some types of nursing home care, it will only cover these expenses if the stay is part of a medical treatment plan, like rehabilitation after a hospital visit. These are generally short-term stays.
What Does Medicare Part A Not Cover?
Medicare Part A does not cover 100% of the bills you incur while staying in a medical facility. Depending on where you go and how long you stay, you may still owe deductibles and copayments. For example, if you are admitted to a hospital, you'll owe an up-front deductible of $1,484 which covers your hospital stay for up to 60 days. After that, you may owe an additional fee per day.
Medicare Part A also does not cover extended stays in assisted living or long-term care facilities because you need custodial care, like help with eating, bathing or getting dressed. It will only cover short-term stays as part of rehab for an illness/injury. No parts of Medicare cover these long-term care expenses, which is why additional long-term care insurance could be worth considering.
Medicare Part A does not provide meals or 24/7 care as part of its home health care services. Neither will it pay for home personal services when that's the only care you need. These home health care services are only added when you are also receiving treatment for another ailment covered by Medicare.
In short, Medicare Part A does not cover all your health care bills. Instead, it's meant to work alongside Medicare Part B for outpatient procedures and Medicare Part D for your prescription drugs.
Who Should Use Medicare Part A?
Medicare Part A is a key part of traditional Medicare, since even short hospital stays can lead to sizable bills. Fortunately, qualifying for Medicare Part A is simple and free for most retirees.
Although Part B and Part D charge premiums, it is possible to qualify for free Part A. There's no cost to join Medicare Part A If you are 65 years old and have paid Medicare taxes for at least 10 years through the mandatory payroll taxes when you were working. You could also qualify for free Medicare Part A based on your spouse's work history or through a disability or certain illness, such as end-stage renal disease.
If you aren't eligible for free Medicare Part A, you could still enroll in this program by agreeing to pay a monthly premium—up to $471 per month in 2021, depending on how much you paid in taxes during your career.
Since Medicare Part A coverage is usually free, it makes sense for most retirees to use it. The main exception would be if you'd rather use a Part C Medicare Advantage plan instead. This would pull you out of traditional Medicare, allowing you to get the same type of coverage from a private insurance plan. However, you must be enrolled in Medicare Part A and Part B before you can move to a Medicare Advantage plan.
If you don't qualify for free Medicare Part A, you could also skip signing up. In this case, you'd still have the option to sign up for Part B and Part D. However, not having Part A would require you to cover your hospital bills out of pocket.
How Do You Find Out if Medicare Part A Covers Something?
The US federal government offers a free Medicare search tool that allows you to you find coverage details by typing in a procedure or type of medical care, such as "skilled nursing" or "surgery." The tool will then say whether the care is covered and, if so, by what part of Medicare. The website also describes coverage for an extensive list of medical procedures and possible treatments.
You can also ask your medical provider whether Medicare will cover what they recommend and, if so, by what part of the program. If they recommend something that might not be covered by your Medicare, the doctor may have you sign a notice indicating that you realize you may need to pay for the treatment yourself.
Does Where You Live Change Your Coverage?
The federal government— not state governments—runs Medicare Part A. Nationwide, Medicare Part A will cover the same services and use the same fee structure for your out-of-pocket costs. As a result, where you live in the United States will not change your coverage, and you can use these benefits anywhere in the country.
However, while your location doesn't impact coverage for Medicare Part A or Part B, it will make a difference for Part C and Part D. These programs are not standardized like Medicare Part A: They give you many plans to choose from, and your options will change depending on where you live.
How Can You Fill Medicare Part A's Coverage Gaps?
If you're worried about the high out-of-pocket costs from Medicare Part A, one option is to buy a Medicare Supplement plan, also known as Medigap. In exchange for your monthly premium, these plans help cover costs from Medicare Part A and Part B such as the potential $1,484 deductible and per-day charges from staying in a hospital.
Another option is to enroll in Medicare Advantage (Part C), as some plans offer more coverage compared with standalone Medicare. To get details on both options, consider meeting with an insurance agent.