Thanks for providing this information on Medicare. I’ve been reading your blog posts, and I have a question. What is the difference with Original Medicare between a Part A Medicare deductible and a benefit period deductible? We have been in good health but I’m concerned for the future. My other question is, what’s covered if I or my husband have to enter a hospital or nursing facility?
If you’re “Bare with Medicare” or in other words, using Original Medicare Part A and Part B for your healthcare insurance instead of a Medicare Advantage plan or Medigap, you’re right; there are deductibles and “Benefit Periods” you must contend with. If you’re hospitalized or get admitted to a Skilled Nursing Facility, you must pay Part A deductibles before your Original Medicare Part A insurance benefits kick in. However, it’s not an annual deductible (payable once a year); it’s a “Benefit Period.” What’s the difference? Glad you asked.
When Does My Medicare Benefit Period Begin?
According to Medicare, a Benefit Period begins the day you’re admitted as an inpatient in a hospital or Skilled Nursing Facility. The benefit period ends when you haven’t received any inpatient hospital care (or skilled care in a Skilled Nursing Facility) for sixty days.
A new benefit period begins if you go into a hospital or a Skilled Nursing Facility after one benefit period has ended. You must pay the inpatient hospital deductible for each benefit period. In 2023, the deductible is $1,600 in 2023, an increase of $44 from $1,556 in 2022 per benefit period, which normally increases yearly. However, there’s no limit to the number of benefit periods during any given year.
Got that? It’s not an annual deductible, so you could actually pay that deductible more than once during a calendar year.
After you’ve paid your Benefit Period deductible, you’ll also have to pay a copay every day after a certain number of days in a hospital or Skilled Nursing Facility. Don’t worry about memorizing these numbers; just know they’re there and change, but not drastically.
What Does Medicare Cover for Inpatient Hospital Visits?
If you’re hospitalized, you’ll first pay $1,600. That covers your hospitalization bills for up to sixty days. If you stay between 61-100 days, divide the deductible by four— you’ll be charged another $400 per day. (I agree with you; that’s quite a bit of money! If your hospital stay is beyond 100 days, divide the deductible by two—days 101 to 150 will cost you $800 per day. Anything over 150 days, you’ll be on the hook for 100% of the charges. Yikes!
If you’re hospitalized for psychiatric care, the benefits are slightly different. You have a 190-day lifetime benefit and some coverage changes.
What Does Original Medicare Cover If I’m in a Skilled Nursing Facility?
What are the odds you will stay in a Skilled Nursing Facility for over 100 days? Very low. But even if you stay in for forty days, the quick math there is twenty days X $200 = $4,000. That’s in addition to anything you might owe from your prior hospitalization. Oh, one more thing.
To get into a Skilled Nursing Facility, you’ll first have to be an inpatient at a hospital for three days. Yep, this means you’ll pay that deductible for the hospital stay in addition to the cost of the Skilled Nursing Facility care, so add the $1,600. This catches many people Bare-with-Medicare or who are on a Medicare Supplement plan by surprise.
Suppose there’s not a prior three-day stay in a hospital. In that case, Medicare won’t approve a Skilled Nursing Facility stay, which can financially expose you to the entire Skilled Nursing Facility bill.
Truthfully, a $1,600 deductible for a hospital stay is a pretty decent insurance benefit. Those of you coming off of an employer-sponsored plan probably had deductibles well above that when you were working. As we’ll cover later, this is less out of your pocket for an inpatient hospital visit than many Medicare Advantage plans will charge you. It’s the sixty-one or more days that should rightfully scare you.
- If you’re in for under twenty-one days, you’ll pay $0.
- Days 21-100, you’ll pay up to $200 coinsurance per day (in 2023).
- Days 100+ you’re on the hook for 100%.
Quick Math: if you stay hospitalized for 100 days, you’ll owe the $1,600 deductible plus 40 X $400 = $17,600. Yikes! If you stay 150 days, it will total over $50,000!. Yikes again!
What odds are you’ll be in the hospital for more than 100 days and still alive? Probably pretty low. Still, in my opinion, this highlights one of the major “Frustrating Flaws” of Original Medicare, which comes up repeatedly.
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Author Bio Matt Feret is the author of the Prepare for Medicare book series and launched prepareformedicare.com to help people get objective answers to questions about Medicare. Matt is also the host of The Matt Feret Show. He has held leadership roles at numerous Fortune 500 Medicare health insurers in sales, marketing, operations, product development, and strategy for over two decades.