What Is Medicare Part A? Coverage and Costs Explained

Medicare Part A is often the first step in building your Medicare coverage. It’s hospital insurance that helps cover inpatient care, skilled nursing facility stays, hospice care, and some home health services. For many, it’s premium-free, thanks to years of work and paying into the system.

Part A is just one part of the bigger picture. It works alongside Part B (which covers outpatient and doctor visits) and Part D (which covers prescription drugs). Together, they provide a foundation, but it’s important to understand what each part covers so you’re not caught off guard by unexpected costs.

In this guide, we’ll walk you through who qualifies for Medicare Part A, what it covers, what it costs, and how to make confident choices about your healthcare.

Who Is Eligible for Medicare Part A?

Most people become eligible for Medicare Part A when they turn 65, as long as they are U.S. citizens or legal residents who have lived in the country for at least five consecutive years.

But age isn’t the only path to eligibility. You may also qualify earlier if you:

• Have received Social Security Disability Insurance (SSDI) for 24 months

• Are diagnosed with ALS (Amyotrophic Lateral Sclerosis), which automatically qualifies you

• Have End-Stage Renal Disease (ESRD) and meet specific criteria

Many people are entitled to premium-free Part A if they or their spouse paid Medicare taxes for at least 10 years (or 40 quarters). If you don’t meet that requirement, you can still enroll in Part A by paying a monthly premium, though the cost will depend on your work history.

Whether you qualify automatically or need to sign up manually, understanding your eligibility ensures you don’t miss your opportunity for coverage or pay unnecessary penalties later.

When and How to Enroll in Medicare Part A

You can enroll in Medicare Part A during several key periods:

• Initial Enrollment Period (IEP): This 7-month window surrounds your 65th birthday, beginning 3 months before, including your birthday month, and continuing 3 months after. Enrolling during this time ensures timely coverage.

• General Enrollment Period (GEP): If you miss your IEP, you can sign up between January 1 and March 31 each year. However, this may result in late penalties and delayed coverage.

• Special Enrollment Period (SEP): If you or your spouse is still working and covered by an employer plan, you may qualify for an SEP. You can enroll without penalty once that coverage ends.

If you're already receiving Social Security or Railroad Retirement Board benefits by the time you turn 65, you'll be enrolled in Medicare Part A automatically. If not, you’ll need to apply manually, either online through SSA.gov, by phone, or at a Social Security office.

It’s important to enroll at the right time. Late enrollment can lead to permanent premium increases and delays in when your coverage kicks in, especially if you don’t qualify for premium-free Part A.

What Does Medicare Part A Cover?

Medicare Part A provides critical coverage for inpatient and facility-based care, including:

Inpatient Hospital Care

This includes semi-private rooms, meals, general nursing care, medications administered during your stay, and necessary hospital services. Blood transfusions (after the first three pints) are also covered.

Skilled Nursing Facility (SNF) Care

Part A covers short-term rehabilitation in a skilled nursing facility, but only after a qualifying 3-day inpatient hospital stay. Covered services include physical therapy, occupational therapy, speech-language pathology, and medical social services.

Hospice Care

If you have a terminal illness and are expected to live six months or less, Part A covers hospice care. This includes pain management, symptom relief, counseling, and support for both the patient and their family.

Home Health Services

Under specific conditions, Part A covers intermittent skilled nursing care and physical or occupational therapy at home. This is generally reserved for those who are homebound or for whom leaving the house poses a health risk.

Important: Coverage is only provided when services are medically necessary and delivered by Medicare-approved providers. Additionally, these services have limits on duration and availability, which are tied to benefit periods and clinical guidelines.

What Isn’t Covered by Part A?

While Medicare Part A provides vital coverage, it doesn’t cover everything. Understanding these gaps is essential for planning your healthcare finances.

Here’s what Part A does not cover:

• Outpatient care or doctor visits (covered under Medicare Part B)

• Prescription drugs taken at home (covered under Medicare Part D)

• Routine dental, vision, or hearing care

• Long-term custodial care or assisted living

• Private-duty nursing or comfort items like TVs and phones during hospital stays

These exclusions are why many people choose to enroll in additional coverage, such as Medicare Advantage or a Medigap plan, to avoid surprise expenses.

What Does Medicare Part A Cost?

Let’s break down the typical costs associated with Medicare Part A:

Premiums

• $0/month: If you or your spouse worked and paid Medicare taxes for at least 40 quarters

• ~$285/month (2025): If you worked 30–39 quarters

• ~$505/month (2025): If you worked fewer than 30 quarters

Deductible

• $1,676 per benefit period (2025): This is what you pay out-of-pocket before Medicare coverage begins for a hospital stay.

Hospital Coinsurance

• Days 1–60: $0

• Days 61–90: $419 per day (2025)

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

Skilled Nursing Facility Coinsurance

• Days 1–20: $0

• Days 21–100: $209.50 per day

Hospice Costs

• Typically includes a small copayment (~$5) for outpatient drugs and 5% of the Medicare-approved amount for inpatient respite care.

Costs can quickly add up, especially for long hospital stays or skilled nursing care. Understanding what you may be responsible for, and when, helps you prepare for future care needs and evaluate supplemental insurance options.

How Is Medicare Part A Funded?

Medicare Part A is financed through the Medicare Hospital Insurance Trust Fund, which is funded by payroll taxes.

• Employees and employers each contribute 1.45% of wages toward Medicare taxes.

• Self-employed individuals pay the full 2.9%.

• High-income earners may pay an additional 0.9% tax on earnings above a certain threshold.

These taxes support Part A benefits for current and future beneficiaries. However, the trust fund has faced concerns about long-term solvency. While changes to the program may be needed in the future, Medicare Part A remains a reliable foundation for hospital coverage today.

Do You Need Supplemental Coverage?

Because Medicare Part A doesn’t cover everything, many beneficiaries opt for additional coverage to reduce out-of-pocket costs.

Medigap (Medicare Supplement Insurance)

Helps cover deductibles, copayments, and coinsurance. Works alongside Original Medicare (Parts A & B), but you’ll still need a separate plan for drug coverage (Part D).

Medicare Advantage (Part C)

An all-in-one alternative that bundles Part A, Part B, and usually Part D. Often includes additional benefits like dental, vision, hearing, and fitness programs.

Each option has pros and cons depending on your needs and budget. Unified Health can help you compare plans to determine which supplemental coverage is best for you.

Common Medicare Part A Questions

Is Medicare Part A really free? 

It’s premium-free for most people who meet the work history requirement, but not for everyone.

What if I’m still working at 65? 

You may qualify for a Special Enrollment Period and delay enrollment without penalty if you have employer coverage.

Can I switch to Medicare Advantage later? 

Yes. The Annual Enrollment Period (October 15–December 7) allows you to switch plans each year.

Does Part A work with Medicaid? 

Yes. If you qualify for both Medicare and Medicaid (dual eligible), Medicaid can help cover costs that Medicare doesn’t pay.

Conclusion and Next Steps

Choosing the right Medicare coverage is one of the most important decisions you’ll make as you plan for your healthcare in retirement. Medicare Part A lays the foundation by covering essential services like hospital stays, skilled nursing care, hospice, and some home health care, but understanding the full scope of coverage, costs, and eligibility requirements is key to getting the most from your benefits.

Part A works in tandem with other parts of Medicare, so it’s vital to see the bigger picture. Whether you qualify for premium-free coverage or need to budget for monthly premiums and deductibles, planning ahead ensures you’re not caught off guard by unexpected costs. And if gaps in coverage concern you, supplemental options like Medigap or Medicare Advantage plans can help provide peace of mind.

Key Takeaways

• Medicare Part A covers hospital-related services, including inpatient stays, skilled nursing, hospice, and limited home health care.

• Eligibility typically starts at age 65, or earlier for people with certain disabilities, ALS, or ESRD.

• Premiums are $0 for most individuals who paid Medicare taxes for at least 10 years, but others may pay up to ~$505/month.

• Costs include deductibles, coinsurance, and coverage limits that can lead to high out-of-pocket expenses if you’re unprepared.

• Enrollment is automatic for some, but others must sign up during designated enrollment periods to avoid penalties.

• Supplemental coverage options like Medigap and Medicare Advantage can help fill in the gaps Part A doesn’t cover.

Need help navigating Medicare Part A or choosing the right plan? Contact Unified Health today for free guidance from our licensed agents and take the first step toward peace of mind.

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