Key Takeaways

• Medicare Part A in 2025 still comes with significant out-of-pocket costs that catch many people off guard, especially when it comes to hospital stays, skilled nursing care, and home health services.

• While it is considered premium-free for most, you are still responsible for deductibles, coinsurance, and specific coverage limits that can result in large medical bills.

What Medicare Part A Covers

Medicare Part A is primarily hospital insurance. It covers inpatient hospital care, skilled nursing facility (SNF) care, hospice care, and some limited home health services. You might think that once you’re enrolled, most of your hospital-related costs are taken care of. But that isn’t the full picture.

Medicare Part A offers:

• Inpatient hospital stays (after a formal admission by a doctor)

• Skilled nursing facility care (under strict qualifying conditions)

• Hospice care for terminal illness

• Limited home health services

What often goes unnoticed is what Part A does not cover, and how the cost-sharing structure works. That structure includes deductibles and coinsurance you must pay yourself.

The 2025 Cost Breakdown You Need to Know

In 2025, here are the basic out-of-pocket amounts you face under Medicare Part A:

• Inpatient Hospital Deductible: $1,676 per benefit period.

• Coinsurance for Hospital Stays:

  • Days 1-60: $0 (after deductible)

  • Days 61-90: $419 per day

  • Days 91 and beyond: $838 per day (using lifetime reserve days)

  • After lifetime reserve days: You pay all costs

• Skilled Nursing Facility Coinsurance:

  • Days 1-20: $0

  • Days 21-100: $209.50 per day

  • After 100 days: You pay all costs

These figures don’t include charges from physicians or outpatient services billed separately under Medicare Part B, which adds another layer of complexity.

Why the Term “Benefit Period” Matters

Understanding how a “benefit period” works is key to avoiding unpleasant surprises. A benefit period begins the day you’re admitted as an inpatient and ends once you’ve been out of the hospital or SNF for 60 consecutive days.

If you’re hospitalized again after 60 days, a new benefit period begins. This means you could owe the $1,676 deductible multiple times in a year if you’re hospitalized multiple times, each after a gap of 60 days or more.

This structure is very different from the calendar-year deductibles most people are used to with other insurance plans.

Common Scenarios That Lead to Unexpected Bills

1. Observation vs. Inpatient Status

Medicare Part A only covers inpatient hospital stays. If you’re under “observation” status, even if you stay overnight in a hospital bed, you’re billed under Medicare Part B. This can result in higher out-of-pocket costs and may affect your eligibility for follow-up care in a skilled nursing facility.

2. Skilled Nursing Facility Requirements

Many people assume SNF care is automatically covered after a hospital stay. But in 2025, Medicare only pays for SNF care if:

• You had an inpatient hospital stay of at least three consecutive days (not counting the discharge day)

• You’re admitted to the SNF within 30 days of leaving the hospital

• Your care in the SNF is for the same condition treated in the hospital

If any of these requirements aren’t met, you’re on the hook for the full cost of care, which can quickly run into the thousands.

3. Exhausting Lifetime Reserve Days

Medicare gives you 60 lifetime reserve days to use when you stay in the hospital longer than 90 days. Once those days are used up, they’re gone forever. If you’re hospitalized for an extended period later in life, you’ll pay the full cost after Day 90.

This isn’t a renewable benefit. Many people use their lifetime reserve days early on, not realizing they won’t have them available later.

Hospital Coverage Isn’t Unlimited

Although Medicare Part A does provide substantial coverage, it’s not unlimited:

• You’re only covered for 90 days per benefit period in the hospital (plus the 60 lifetime reserve days).

• You’re only covered for 100 days per benefit period in a skilled nursing facility (only after meeting all requirements).

If you need long-term hospital or SNF care, you’ll eventually need to pay the full cost yourself or seek additional insurance.

Home Health and Hospice Coverage Gaps

While Part A does offer home health and hospice coverage, there are narrow definitions and eligibility criteria:

• Home health services must be deemed medically necessary and you must be homebound.

• Hospice care is only available if your doctor certifies you as terminally ill (with a life expectancy of six months or less).

You may still have to pay 20% for durable medical equipment under Part B, and respite care under hospice may require a copayment.

The Psychological Cost of Uncertainty

Beyond the actual dollar amounts, there’s a less visible but very real cost: uncertainty. Many people go into retirement thinking Medicare Part A is comprehensive, only to find out during a hospital stay that:

• They’re subject to benefit periods they didn’t understand

• They owe coinsurance after a certain number of days

• They’re not covered at all due to observation status or SNF requirements

This creates anxiety at a time when people are already dealing with health issues, leading to difficult decisions about care.

What You Can’t Rely On

You can’t assume that being in a hospital means you’re automatically under Medicare Part A. You can’t assume that a short hospital stay will trigger SNF coverage. You can’t assume that all follow-up care is covered. And you definitely can’t assume your costs will be the same year-round.

These assumptions are what drive surprise bills and out-of-pocket expenses.

What You Can Do Now to Prepare

While Medicare Part A’s structure isn’t likely to change dramatically mid-year in 2025, you can take steps to better understand and manage your costs:

• Know your benefit periods and keep track of your hospital stays.

• Ask about your inpatient status as soon as you’re admitted.

• Review the SNF criteria if you think you may need follow-up care.

• Look into supplemental insurance to help cover gaps (but remember, no private plan names or prices are discussed here).

• Consult with a licensed agent to get a better understanding of how Medicare works with other insurance you may have.

How 2025 Medicare Costs Compare to the Past

In 2024, the inpatient deductible was $1,632, and the daily coinsurance rates were slightly lower. Each year, these amounts rise with inflation and adjustments from the federal government. While the increases might seem modest, over time they add up—especially if you experience frequent hospitalizations.

The pattern is clear: Medicare Part A isn’t staying flat in cost. Even though you may not pay a monthly premium, your out-of-pocket exposure continues to increase annually.

It’s Still a Valuable Program—But It’s Not Automatic Protection

Medicare Part A provides important financial support during hospital stays and end-of-life care. However, its structure places limits on that support, both in terms of time and money. You need to understand those limits so you’re not caught off guard.

This doesn’t mean you should avoid care. It means you should be better equipped, financially and mentally, for how Medicare functions in 2025.

Ready for Better Clarity on Your Coverage?

Understanding the gaps in Medicare Part A can help you avoid nasty billing surprises. Take time now to review what is and isn’t covered, especially the rules about hospital admissions and SNF care.

If you’re unsure how this affects your situation, speak with a licensed agent listed on this website. They can help you understand how Medicare fits into your overall healthcare strategy in retirement and what steps you can take today to minimize future costs.