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Does Medicare Cover Hospitalizations For Observation

Does Medicare Cover Hospital Stays?

Most of the time, hospital bills can be quite expensive. Which adds even more stress to the relatives and loved ones of the sick person. Especially for extended stays, hospital bills can be very difficult for a family to pay.

So a common question many people have is, “does Medicare cover hospital stays?” In this article, we answer that question in clear, plain English. You will also find the average costs of hospital stays and other helpful info.

Does Medicare Cover Hospital Stays?

The short answer is yes; Medicare will cover the cost of hospital stays. But not 100% of the time. As is often the case with Medicare, certain conditions have to be met in order for Medicare to pay for your hospital stays. Below we look at what these are so you know what to expect.

Original Medicare

Original Medicare (Medicare Part A and Part B) provides coverage for hospital stays. Coverage for hospital stays is provided by Medicare Part A. Medicare Part A is the portion of Original Medicare that provides coverage for inpatient expenses such as hospitalization as well as care at skilled nursing facilities and other inpatient settings. 

Even though coverage for hospital stays is provided by Medicare Part A, your healthcare provider must first deem it medically necessary for you to be admitted to a hospital. Services in a hospital stay that Medicare Part A covers include the following:

  • General nursing care
  • Semi-private room
  • Hospital equipment 
  • Hospital services
  • Meals
  • Medications for treating the symptoms of your illness

Medicare Part A has a period called the “benefit period”. During a benefit period, Medicare Part A will cover 100 percent of the costs of your inpatient stay and treatment from days 1 to 60 of your hospital stay. Between days 60 and 90, Medicare Part A will provide coverage for the expenses, but you will have a copay of $371 per day in 2021.

From day 91 and onwards, Medicare Part A will no longer cover the costs of your hospital stay. However, Medicare Part A provides 60 lifetime reserve days, and if you have them, they will still provide coverage for your hospital stay after 90 days but you will pay a copayment of $742 per day.

Medicare Part B does not provide coverage for hospital stays as it only covers medically necessary outpatient procedures, services, and equipment. 

Part C Coverage for Hospital Stays

Medicare Advantage plans (Medicare Part C) also provide coverage for hospital stays. They cover everything Original Medicare covers, and usually also provide some additional benefits. However, exactly what it covers and what your out-of-pocket costs are will vary depending on the specifics of your plan. 

How Much Does A Hospital Stay Cost?

The exact amount of hospital stays per day will vary on what type of services you need. However, the average cost of hospital stays can go as high as $11,700.

Note: Medicare coverage changes all the time. And your specific coverage may vary from plan to plan for Medicare Advantage and Medigap plans. Always be sure to double check with your health care provider and/or Medicare insurance provider about what your plan covers and what it does not.

Additional Info on Medicare Coverage

This article is part of our series on “What does Medicare cover?”

Also, you can check out other articles in this series including: Does Medicare cover pregnancy?

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