What Does Medicare Part A Cover?

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Medicare is the federal health insurance program that provides coverage for American citizens and permanent residents 65 and older. Introduced in 1965, Medicare covered 61 million people in 2019, almost 19% of the population.

The original Medicare program had two parts: hospital insurance (Part A) and medical insurance (Part B). But it has expanded over the years to include optional drug coverage (Part D). Medicare can also refer to comprehensive plans offered by private companies (Part C/Medicare Advantage Plans) and supplemental plans (Medigap), also offered by private companies.

Medicare is an important part of your retirement plan. Learn the basics of what Part A does and how to sign up for it.

Key Takeaways

  • There are multiple parts to Medicare coverage.
  • Part A is hospital insurance. It also covers hospice care plus some skilled nursing facility care and home health care.
  • Most people don't pay a premium for Part A coverage.
  • Most people are eligible to sign up for Part A and all other Medicare benefits from three months before the month they turn 65 through three months after that month.

What Is Medicare Part A?

Part A is the hospital insurance portion of Medicare. Most people become eligible for Medicare once they turn 65 and may be automatically enrolled if they receive Social Security benefits. Otherwise, you have a limited window during which to sign up for Part A without having to pay a penalty. This is referred to as the initial enrollment period, which lasts for a total of seven months (three months before you become eligible for Medicare and three months after).

If you already get Social Security retirement benefits (or are eligible for them), you won’t pay a premium for part A.

If you wait to sign up for Medicare until the month you turn 65 or later, you may have a coverage gap.

What Does Medicare Part A Cover?

Part A covers a percentage of hospital or skilled nursing facilities based on benefit periods. A benefit period begins when you're admitted and ends 60 days after you are no longer receiving care. There is no limit on benefit periods. 

Part A also covers 100% of hospice care and skilled intermittent home health care.

Inpatient Care in a Hospital

What it pays for:

  • Hospital services
  • Supplies that are part of your treatment
  • Semi-private rooms
  • Nursing care
  • Drugs 
  • Meals

When it pays: Part A coverage begins when you are admitted under a physician's orders to a hospital that accepts Medicare. 

What you pay:

  • For each benefit period, a $1,484 deductible
  • After 61 days, $371 coinsurance
  • After 91 days, $742 coinsurance for up to 60 days
  • Once these benefits are expired, 100% of charges

Skilled Nursing Facility Care

What it pays for:

  • Short-term skilled nursing care
  • Occupational, speech, and physical therapy
  • Medical social services (medical social workers)
  • Dietary counseling
  • Medications
  • A semi-private room
  • Ambulance services

When it pays: After you have had a qualifying hospital stay of three days. Care ordered by a physician has to be for a qualifying condition that was treated during your hospital stay or that started in a skilled nursing facility.

What you pay:

  • 100 days of skilled nursing care per benefit period
  • First 20 days: $0
  • Day 21 through day 100: $185.50
  • Day 101 and beyond: all costs

Hospice Care

What it pays for:

  • Any items, services, or durable medical equipment needed to relieve pain and manage symptoms, including drugs for pain management
  • Medical, nursing, and social services
  • Aide and homemaker services
  • Inpatient respite care received in a Medicare-certified facility to provide rest to the usual caregiver, such as a family member

Services can be provided in the home, or at a Medicare-certified facility. 

When it pays: A hospice doctor and your personal physician certify a life expectancy of six months or less.

What you pay:

  • $0 for care
  • $5 copay for prescriptions
  • 5% copay for the Medicare-approved amount for inpatient respite care

Home Health Care

What it pays for:

  • Part-time skilled nursing care
  • Home health aid
  • Medical social services
  • Physical, occupational, and speech therapy
  • Durable medical equipment needed for care
  • Osteoporosis injections for women

When it pays: Your physician certifies that you are homebound, puts you on a plan of care that requires one or more home health care services, and reviews that plan of care regularly.

What you pay:

  • $0 for home health care
  • 20% copay for the Medicare-approved amount for durable medical equipment

What Doesn’t Medicare Part A Cover?

No part of Medicare covers long-term care, or 24 hour-a-day custodial care. Custodial care is given at home or in a nursing home, such as a memory unit, and provides assistance with the six activities of daily living: eating, bathing, dressing, toileting, transferring, and continence. 

Medicare also does not cover dental care, denture, eye exams for glasses, hearing aids, acupuncture, cosmetic surgery, and routine foot care. 

Part A additionally doesn’t cover prescription drugs (other than drugs for pain management in hospice or as part of your inpatient treatment), physician fees, diagnostic services, or preventive services. 

How Part A Compares to Other Parts of Medicare

Part B

Part B is the counterpart to Medicare Part A; it covers regular exams and diagnostic services.

What it pays for:

  • Physician fees
  • Diagnostic tests
  • Preventive and screening services
  • Ambulance services
  • Durable medical equipment
  • Mental health services

When it pays: Services have to meet Medicare guidelines. Medicare publishes a guide of services covered and their maximum fees. 

What you pay

  • Most people pay the standard premium of $148.50 per month. 
  • High-income earners may pay up to $504.90 per month. 
  • If you enroll in part B after your initial enrollment period, you may have to pay an ongoing late fee.

Part C

Part C is Medicare Advantage: a comprehensive health plan offered by private insurance companies. 

What it pays for: These plans have to cover at least what Medicare covers, including prescriptions, and many offer more coverage like dental and vision benefits. Medicare beneficiaries can enroll in Medicare Advantage instead of Parts A, B, and D.

When it pays: It depends on the specific plan you enroll in, but benefits eligibility will be similar to other Medicare plans.

What you pay: If you select Medicare Advantage, you have to enroll and pay for the Part B premium. However, some Medicare Advantage plans will pay the Part B premium for you, and others will charge an additional premium. Each Medicare advantage plan has its own deductibles and copays.

Part D

Part D is Medicare-approved prescription drug coverage offered by private insurance companies. 

What it pays for: Medicare Part D is optional. If you enroll in Part D after your initial enrollment period you may have to pay an ongoing penalty.

When it pays: Prescriptions have to meet plan approval for use. 

What you pay: Each plan has its own premiums, copay, and deductible. 

Frequently Asked Questions (FAQs)

How much does Medicare Part A cost?

If you are eligible for Social Security benefits, there is no cost for Medicare Part A.

How do I sign up for Medicare Part A?

You can enroll online from the Social Security Administration website.

How is Medicare Part A financed?

Part A is financed primarily through premiums, the government’s general fund, and Medicare payroll taxes (paid by employers and their employees). The current withholding rate is 1.45% for employees and employers, for a total of 2.9%. There is an additional 0.9% on withheld wages above $200,000.