What is Medicare Part A?

What does Medicare Part A cover? | Eligibility | Costs | Enrollment | Ways to save

Medicare was signed into law by Lyndon B Johnson in 1965 and has four parts. This article will focus on Medicare Part A, which covers inpatient hospital stays, among several other services, such as subacute rehabilitation in a skilled nursing facility.

What does Medicare Part A cover?

When it comes to inpatient services or hospital insurance for people with Medicare, Medicare Part A provides that coverage. You’ll be required to meet a deductible when admitted to the hospital. This deductible isn’t just paid once a year, and it’s reoccurring with each benefit period. Anytime you are admitted as an inpatient in a new benefit period, you’ll have to pay it. 

A benefit period begins the first day you are admitted to an inpatient facility and concludes when you have not received inpatient care for 60 days in a row. If you are admitted to the hospital after a benefit period has concluded, a new benefit period will begin when you are admitted, and the deductible must be paid again. 

Once you pay your Medicare Part A deductible, there is $0 coinsurance for the first 60 days in the hospital. If your inpatient hospital stay is longer than 60 days, you’ll pay an additional copay for each day.

What’s not covered

Medicare doesn’t cover the costs of long-term care facilities such as a nursing home, including if you’re in hospice. 

Outpatient services such as visits to your healthcare provider, outpatient surgery, and laboratory tests are not covered under your Hospital coverage. These services are covered under Medicare Part B.

Part B covers outpatient care such as doctor visits, preventive services, durable medical equipment, and diagnostic health screenings. For more information on Medicare Part A costs and qualifications, visit medicare.gov.

Who is eligible for Medicare Part A?

Original Medicare includes Medicare Part A and Part B, which share the same eligibility requirements.

Medicare Part A eligibility criteria: 

• Aged 65 or older
• Or under 65 with specific health conditions
  • End-Stage Renal Disease
  • Lou Gehrig’s disease (Amyotrophic Lateral Sclerosis)
  • Receiving disability benefits for more than 24 months
• Be a resident of the United States
  • Either as a U.S. Citizen
  • Or a legal alien admitted for permanent residence. You must live in the U.S. for a continuous five years before applying.

How much does Medicare Part A cost?

Most Medicare beneficiaries qualify for premium-free Part A. Part A is paid through your Medicare taxes while you’re working. To qualify for the premium-free Part A, you must work and pay your Medicare taxes for at least 40 quarters, which is equivalent to ten years, qualify with a spouse’s work history, or have Railroad Retirement Benefits.

If you did not work and pay the Medicare tax for at least 40 quarters, you may still enroll in Medicare Part A, but you may have a monthly premium.

If you or your spouse worked between 30 and 39 quarters, you’d pay $278 per month for Medicare Part A. If you or your spouse work less than 30 quarters, you’ll pay $505 per month for Medicare hospital insurance.

Many beneficiaries who have to pay a Part A premium will have it deducted from their monthly Social Security benefit. However, you may pay directly if you choose to do so or if you have not yet started collecting Social Security. 

Your Part A cost-share is below for 2024. This is representative of the costs of Original Medicare Part A only and does not reflect the cost with a Medigap or Medicaid.

Medicare Part A enrollment

Medicare Part A enrollment can be automatic, but some people may need to apply. It will depend on your situation. Suppose you’re already receiving Social Security or Railroad Retirement benefits as you turn 65. In this case, you’ll be automatically enrolled if you meet the eligibility requirements.

Consequently, if you are diagnosed with ALS or have been on disability for more than 24 months, you’ll automatically be enrolled in Medicare.

You’ll need to apply for Medicare if you’re not collecting Social Security or Railroad Retirement benefits. If you have ESRD, you will not be automatically enrolled, but you will qualify if you are under 65. In this case, you’ll need to apply for Medicare.

You may enroll in Medicare at specific times (enrollment periods). If you choose to enroll after your Initial Enrollment Period and don’t have creditable coverage, you could be subject to a Medicare late enrollment penalty. There are different late enrollment penalties for Part A, Part B, and Part D of Medicare.

Initial Enrollment Period

Three months prior to your 65th birthday or if you are diagnosed with a qualifying health condition, you start your Initial Enrollment Period. The Initial Enrollment Period is a 7-month window to apply for Original Medicare.

Special Enrollment Period

Suppose you’re leaving or losing creditable coverage such as a group employer plan. In that case, you’ll have eight months from the date the plan ends to enroll in Medicare. This enrollment period is known as a Special Enrollment Period. There are many scenarios that could make you eligible for a SEP.

General Enrollment Period

If you miss your Initial and Special Enrollment Periods, you’ll be required to wait until the General Enrollment Period. This enrollment period begins on January 1 and ends on March 31. You can enroll in Medicare during this time, but the coverage won’t start until the first day of the following month after you sign up.

How to save money on Medicare Part A

As you can see from above, there are costs associated with Medicare Part A, which can get out of control fast. You can do a few things to protect yourself from the high costs associated with Medicare Part A and Part B.

1. Medicare Advantage (Part C)

You can choose to receive your Medicare coverage through a Medicare Part C plan. These Medicare Advantage plans will combine your inpatient care and outpatient medical insurance from Original Medicare into one plan. In addition, these plans will usually include your Medicare Part D prescription drug coverage and sometimes additional benefits that Original Medicare doesn’t include, like vision and dental coverage.

Most Medicare Advantage plans are network-based. This means that if you use providers that aren’t in the network, you’ll be responsible for a higher copay or potentially the entire cost. Most Medicare Advantage Prescription Drug (MAPD) plans will also need referrals and authorizations for specialists and services before they are covered.

2. Medicare Supplement Insurance 

Another option to save is to add a Medicare Supplement health insurance program (Medigap plan) to your Original Medicare plan. Medigap plans help cover the costs left over from coverage of your Part A coverage and Part B health services. These plans don’t include your prescriptions, so you’ll need to add a prescription drug plan

Medigap plans are designed to cover your Medicare costs for all covered services related to Medicare Parts A and B. Medicare Supplement Insurance plans are health plans provided by private insurance companies. Unlike Medicare Advantage plans, these plans aren’t network-based and don’t require referrals or additional approvals.

3. Medicaid 

If a Medicare beneficiary is low-income, they may qualify for Medicaid. If you qualify, then Medicaid will help cover costs associated with Medicare. It can help with costs such as your Part A deductibles, copays, Part B premiums, copays, and coinsurance. 

Sources

• Costs, medicare.gov
• Special Enrollment Periods, medicare.gov
• When does Medicare coverage start? medicare.gov
• Medicaid eligibility, medicaid.gov