Key Takeaways

• Many people assume Medicare Part A is free, but you might have to pay premiums depending on your work history and eligibility.

• Gaps in what Part A covers can lead to high out-of-pocket costs if you don’t plan ahead or pair it with additional coverage.

Understanding the Basics of Medicare Part A

Medicare Part A is your hospital insurance. It typically covers inpatient hospital stays, care in a skilled nursing facility (under strict conditions), hospice care, and some home health services. While that sounds like a wide safety net, you need to understand its limits to avoid being caught off guard.

For many people turning 65, Part A is automatically available and premium-free. But this is only true if you or your spouse paid Medicare taxes for at least 40 quarters—equivalent to 10 years of work. If you have fewer than 30 quarters, you pay the full premium. With 30 to 39 quarters, you pay a reduced amount.

Current Premiums for 2025

• 40 quarters or more: No premium (but do not assume it applies to you).

• 30–39 quarters: $284 per month.

• Fewer than 30 quarters: $518 per month.

Even if you don’t automatically qualify for premium-free Part A, you can still enroll voluntarily. But if you don’t sign up when you’re first eligible and you aren’t covered by a qualifying group health plan, you could face a penalty.

What Part A Actually Covers—and What It Doesn’t

You might believe Medicare Part A covers all hospital-related expenses, but that’s only partly true. Here’s what it covers:

Inpatient Hospital Stays

• Semi-private room

• Meals

• General nursing

• Medications and treatments while admitted

• Lab services and some diagnostic testing

Skilled Nursing Facility (SNF) Care

• Must follow a hospital stay of at least three days

• Covers room and board, nursing, rehab services (like physical therapy)

Hospice Care

• Pain relief and symptom management

• Social work services and grief counseling

Home Health Care

• Must be medically necessary and ordered by a doctor

• Includes part-time skilled nursing care and therapy

Now, what it doesn’t cover:

• Private-duty nursing

• A private room (unless medically necessary)

• Television or phone services

• Personal care items (like razors or socks)

• Long-term care or custodial care

Financial Gaps That Could Catch You Off Guard

Medicare Part A has significant cost-sharing responsibilities. These can quickly add up if you need extensive hospital or skilled nursing care.

Hospital Deductible and Coinsurance in 2025

• Inpatient deductible: $1,676 per benefit period

• Days 1–60: No coinsurance (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: nil

• Days 21–100: $209.50 per day

• After 100 days: You pay all costs

If you think Medicare will cover an extended nursing home stay, think again. Once you reach 101 days in a skilled nursing facility, Medicare pays nothing under Part A.

Timelines and Enrollment Periods Matter

Enrollment into Medicare Part A isn’t automatic for everyone. You need to understand the critical timeframes to avoid penalties and delays.

Initial Enrollment Period (IEP)

• Starts 3 months before the month you turn 65

• Ends 3 months after your birthday month

If you miss your IEP and aren’t covered by employer insurance, you might face late enrollment penalties. These penalties can last for as long as you have Part A and increase your premiums permanently.

General Enrollment Period (GEP)

• January 1 to March 31 each year

• Coverage begins July 1

Special Enrollment Period (SEP)

• Available if you’re still working and covered by a group plan

• Ends 8 months after you leave your job or lose coverage

Who Might Still Need to Pay for Part A

Some people incorrectly assume that once they turn 65, Medicare Part A is free for everyone. But this only applies to people who worked and paid Medicare taxes long enough.

You may need to pay for Part A if:

• You didn’t work enough quarters

• You’re not eligible through a spouse

• You immigrated to the U.S. later in life

• You chose not to pay into Medicare during self-employment

If you’re paying for Part A, failing to enroll when first eligible can trigger late penalties. These increase your monthly premium by 10% and apply for twice the number of years you delayed enrollment.

Coordination with Other Coverage

If you’re still working at 65 and covered by an employer plan, you might not need to enroll in Part A right away—unless your employer has fewer than 20 employees. In that case, Medicare becomes primary.

Medicare also coordinates with:

• COBRA (but COBRA doesn’t count as creditable coverage)

• TRICARE (requires active enrollment in Medicare)

• Veterans Affairs (VA) benefits (doesn’t replace Medicare)

Failing to enroll in Medicare when it becomes primary can result in denied claims and large medical bills.

Why You Shouldn’t Rely on Part A Alone

Many people make the mistake of thinking Medicare Part A is all they need. But given the deductibles, coinsurance, and coverage limits, relying on Part A alone is risky.

Without additional coverage, such as Medicare Part B or supplemental insurance, you’re responsible for many expenses:

• Outpatient care and doctor visits (not covered by Part A)

• Durable medical equipment (not covered)

• Prescription drugs (Part A only covers limited inpatient medications)

If you need hospital care followed by rehab, for example, you’ll be hit with cost-sharing in both settings. You need to consider how you’ll cover these costs.

Late Enrollment Isn’t Just About Cost—It’s About Access

If you delay enrollment in Part A and later decide to sign up, your access to care could be delayed. Some people wait for a medical event before enrolling, only to find they need to wait months for coverage to begin.

Additionally, without timely enrollment, you may find yourself ineligible for other programs that require active Medicare participation. This can include:

• Employer retiree health plans

• Medicaid coordination

• Medicare Advantage plans (require enrollment in both Part A and B)

Planning Ahead Helps You Avoid Unpleasant Surprises

Understanding the rules around Medicare Part A helps you avoid:

• Unexpected medical bills

• Coverage delays

• Penalties that last a lifetime

Here’s how you can prepare:

• Check your Social Security work record to confirm if you qualify for premium-free Part A

• Learn the enrollment dates and don’t miss your IEP

• Understand what is and isn’t covered

• Evaluate your need for additional coverage

• Talk to a licensed agent to map out your best options

Hospital Insurance Can Be a Financial Trap Without the Right Knowledge

Medicare Part A plays a vital role in your healthcare coverage, but it’s far from complete. The misunderstanding around costs, coverage gaps, and enrollment timing can set you back financially if you’re not prepared.

Being informed is your first step to protection. To make the most of Medicare, get in touch with a licensed agent listed on this website. They can help you review your eligibility, evaluate your costs, and determine if you need supplemental coverage.