Key Takeaways

• A hospital stay doesn’t automatically mean Medicare Part A will cover everything. Observation status, lack of qualifying inpatient days, and timing issues can leave you with unexpected bills.

• Understanding the requirements for skilled nursing care, benefit periods, and deductible resets is essential to avoid thousands in out-of-pocket costs.

What Medicare Part A Covers on Paper

Medicare Part A is designed to cover inpatient hospital care, skilled nursing facility (SNF) care, hospice, and some home health services. For hospital care, this typically includes:

• Semi-private rooms

• Meals

• General nursing

• Medications as part of inpatient treatment

• Other hospital services and supplies

For 2025, if you are admitted to the hospital as an inpatient, you pay a deductible of $1,676 per benefit period. After that, Medicare covers most costs for the first 60 days. But that basic outline doesn’t tell the full story.

When You’re in the Hospital but Not Technically “Admitted”

One of the most confusing and costly issues with Medicare Part A is the difference between being “admitted” and being “under observation.”

Hospitals may keep you in a bed, run tests, provide IVs and medications, and even keep you overnight or longer. But unless you’re officially admitted as an inpatient (with a doctor’s order), Medicare treats your stay as outpatient care, which is billed under Part B, not Part A.

This matters because:

• Part B has a 20% coinsurance after the annual deductible, which can be high for services like MRIs or emergency care.

• Time spent under observation does not count toward the 3-day inpatient stay required for Medicare to cover a skilled nursing facility (SNF).

You must be formally admitted and stay for three full consecutive inpatient midnights for Medicare Part A to pay for SNF care afterward.

The 3-Day Rule Can Cost You Thousands

Medicare will only cover a skilled nursing facility stay under Part A if you:

• Have a qualifying hospital stay of at least 3 consecutive inpatient days (not counting the discharge day or observation days).

• Enter the SNF within 30 days of leaving the hospital.

If you don’t meet these conditions, you’re on the hook for the entire SNF bill. In 2025, this cost can easily exceed several thousand dollars for a short stay.

Even if your doctor thinks you need skilled care, Medicare won’t pay unless the 3-day requirement is met.

Each Benefit Period Comes With a New Deductible

Medicare Part A uses “benefit periods” to measure your use of hospital and SNF services. A benefit period begins when you’re admitted to a hospital or SNF and ends when you haven’t received inpatient or SNF care for 60 days in a row.

This structure resets your costs:

• If you’re hospitalized in January and then again in April (more than 60 days later), you’re responsible for a new $1,676 deductible.

• There’s no limit to the number of benefit periods you can have in a year.

If you have multiple hospitalizations throughout the year, you could face multiple Part A deductibles.

Coinsurance Kicks in After 60 Days

Even if you’re fully admitted and meet all requirements, Medicare Part A doesn’t cover hospital stays indefinitely. Once your hospital stay exceeds 60 days within a benefit period, daily coinsurance charges begin:

• Days 61–90: You pay $419 per day.

• Days 91–150 (lifetime reserve days): You pay $838 per day.

• After day 150: You are responsible for all costs.

Lifetime reserve days are limited to 60 total days over your lifetime. Once used, they don’t reset.

Skilled Nursing Facility Costs Add Up Quickly

If you do qualify for SNF care under Part A, Medicare pays in full for the first 20 days. Starting on day 21, you pay daily coinsurance:

• Days 21–100: You pay $209.50 per day.

• After day 100: You are responsible for all costs.

These out-of-pocket charges can accumulate fast. And if you never qualified with a 3-day inpatient hospital stay, Medicare won’t pay anything, not even for the first 20 days.

Home Health Coverage Isn’t Automatic

Medicare Part A can cover limited home health services, but this is only if:

• You are under a doctor’s care.

• A doctor certifies you as homebound.

• The services are part-time or intermittent.

Even then, Part A usually covers home health only if it follows a hospital or SNF stay. If it doesn’t, the services may fall under Part B or may not be covered at all.

Additionally, you could still be responsible for 20% of durable medical equipment (like walkers or oxygen equipment), even when home health care is covered.

Hospice Care Is Covered, But Not Without Limits

Medicare Part A covers hospice care for terminally ill patients who have chosen comfort-focused care instead of curative treatment. But there are still loopholes to be aware of:

• You must be certified by a doctor as terminally ill with a life expectancy of 6 months or less.

• You must receive care from a Medicare-approved hospice provider.

Medicare covers most hospice costs, but not all:

• Room and board in a nursing home is not covered unless it’s for short-term respite care or symptom control.

• Medications unrelated to the terminal illness may not be covered.

• You may need to pay up to 5% of the cost of outpatient prescription drugs for symptom management.

Observation Status Can Wreck Your Post-Hospital Plans

Let’s revisit observation status for a moment. Even if you spend three days in the hospital, if any part of your stay was labeled as “observation,” it invalidates the entire period as a qualifying inpatient stay.

This has downstream effects:

• No SNF coverage.

• Higher out-of-pocket costs for the hospital stay.

• Potential medication and lab test bills that Part A would have otherwise covered.

Hospitals are required to inform you in writing if you are under observation for more than 24 hours, but many people don’t understand the implications until the bills arrive.

Timing Mistakes That Trigger Extra Costs

Some timing-related pitfalls under Medicare Part A include:

• Discharge timing: If you’re discharged on a Friday and admitted again the following Monday, you may not meet the 3-day SNF rule.

• 30-day SNF window: You must enter the SNF within 30 days of hospital discharge to qualify.

• Benefit period resets: If more than 60 days pass between inpatient care, your deductible resets, and your coinsurance clock starts over.

Being just a day off in any of these timelines can leave you without coverage.

Medicare Advantage Plans Don’t Always Fix These Issues

Even if you’re enrolled in a Medicare Advantage (Part C) plan, you’re not immune to these issues. Many Medicare Advantage plans follow the same rules around inpatient admission and SNF eligibility.

While Advantage plans may offer some flexibility or added benefits, they can also come with:

• Different cost structures

• Preauthorization requirements

• Limited provider networks

Always check the details of your plan, especially during open enrollment, to understand how it handles hospital and post-acute care.

What You Can Do to Avoid Surprise Part A Costs

Here are some steps to take that can help minimize unpleasant billing surprises:

• Ask your doctor: Am I formally admitted as an inpatient?

• Request status confirmation: Make sure your hospital status is changed to inpatient if appropriate.

• Understand your benefit period: Keep track of your last inpatient or SNF care.

• Plan SNF transitions carefully: Confirm your SNF is covered, and your timing aligns with the 3-day rule.

• Review bills and notices: Always read Medicare Summary Notices to ensure proper coding and coverage.

Protecting Yourself from the Fine Print

You can’t prevent emergencies, but understanding Medicare Part A’s loopholes gives you more control over your financial exposure. Just assuming you’re “covered” can result in thousands of dollars in bills for short hospital visits, missed SNF windows, or simple timing issues.

If you’re unsure about how your hospital stay or care plan will be treated under Medicare, speak with a licensed agent listed on this website. They can help you evaluate your options and identify any coverage gaps that need to be addressed.