The Medicare benefit period is how Medicare estimates and pays for your healthcare when you’re a patient in a hospital or a skilled nursing facility. The amount you need to pay for your medical care will vary depending on your benefit period.
Your benefit period ends when you haven’t spent more than 60 days in a skilled nursing facility or hospital after being discharged.
Continue reading to explore more about the Medicare benefit period (MBP) and how it will affect the inpatient care costs you will pay.
What precisely is Medicare benefit period?
Medicare benefit periods are primarily concerned with the Part A of the Original Medicare that covers medical and skilled nursing facility care. Medicare establishes a benefit period to assist you in determining your share of the costs. This amount is calculated based on the length of your stay.
Medicare Part A benefits apply to the following facilities:
- ambulatory care or inpatient rehabilitation center
- skilled nursing facility
Your benefit periods might differ from those in Medicare Part A if you have Medicare Advantage (Part C plan) instead of traditional Medicare. We will go over those details later.
What are the costs and scope of coverage for a Medicare benefit period?
Let’s discuss how the benefit periods in the Medicare Part A plan are structured. If you want to stay at a medical center for at least two midnights, you will begin a benefit period.
Here’s what you will need to pay in 2021:
- Initial deductible: Your deductible is equal to $1,484 during each benefit period. Medicare will begin covering costs once you pay this amount.
- Day 1 to Day 60: During this timeframe, you will pay $0 deductibles during your first 60 days as an inpatient.
- Days 61 to 90: During this benefit period, you will be charged a $371 daily coinsurance fee for your medical care.
- Day 91 and beyond: After the 90-day period, you will begin to use your lifetime reserve days. You have 60 more days after day 90 that you can use for the rest of your life. They can be used in conjunction with other benefit periods. For each lifetime reserve day used, you would pay $742 in copayments. After you have used up your 60 days period, you will be liable to pay compensation associated with inpatient stays that last more than 90 days.
Post ambulatory care after clinic stay
An estimated 40% of participants with Medicare coverage require post-ambulatory care after a hospital stay, such as the SNF (skilled nursing facility). When you’re in a skilled nursing facility, your copayments work a little differently. The following is a breakdown of those charges in 2021:
- Initial deductible: The same $1,484 Part A deductible applies during each benefit period.
- Day 1 to Day 20. You don’t need to pay any coinsurance cost for the first 20 days of your visit to a skilled nursing facility.
- Day 21 to Day 100. During this time, you will pay a daily coinsurance of $185.50 for your healthcare.
- Day 101 and onward. You are solely responsible for all expenses.
Costs might vary from year to year due to changes in Medicare policies. It’s important to check every year to find out if the copayments and deductibles have changed, so you know what’s going to happen.
According to a 2019 prospective review, benefit periods are designed to reduce excessive or unnecessarily lengthy stays in a medical center or healthcare facility. Medicare programs do not cover long-term care.
How do benefit periods work?
Medicare benefit periods can undoubtedly be perplexing. Below are a few examples that help explain how they work.
Example 1: New benefit period
If you become ill and need to go to the medical center and you haven’t been in a skilled nursing facility or hospital in the last 60 days. This means that you will begin a new benefit period as soon as you are admitted as an inpatient.
Your benefits will start as a clean slate, which means you will pay your insurance deductible first. Then, coinsurance charges will begin after you have stayed in the clinic for 60 days.
Example 2: Relocation to a different center
After a fall, you will need to stay in the hospital for five days. Your doctor transfers you to a skilled care facility for rehabilitation on day six so that you can recover before returning home.
When you are moved to a skilled nursing facility, you are still in the same benefit period as when you were admitted to the medical center for the fall.
You will continue to pay toward the deductible that was in effect at the hospital unless you have already met it. At this stage, you would have 55 days period before copayment fees kicked in.
Example 3: Returning to a benefit period
You stay in the hospital for about ten days before being discharged. Unfortunately, you became ill again 30 days after being discharged. So you return to the hospital and get admitted for another stay.
Because you were admitted to the hospital again within 60 days of your first visit, you are still eligible for the same benefit period as before.
Again, you will be contributing to the same copayment as you did for the first visit unless you have already met it. It will be day 11 of your coinsurance-free health insurance coverage (up to the limit of 60 days before monthly costs begin).
You can have an unlimited number of benefit periods throughout your Medicare coverage. There is no year-to-year limit.
How does this work in conjunction with other Medicare plans?
Your benefit periods might differ from Medicare Part A if you purchased a Medicare Advantage (Part C plan). These benefit periods can vary, so it’s important to read your policy documents thoroughly. You should have received an explanation of your benefits when you signed up for your plan. These documents will describe your Medicare benefit periods.
Some plans require a copayment for a clinic stay or different deductibles for a skilled nursing facility and approve you for an unlimited number of days in a benefit period. Other programs may charge a fee for the first five days spent in a medical center, then charge nothing for the remaining days during the benefit period.
Medicare Advantage plans vary greatly, so it’s essential to read your coverage documents and papers for details. You can also contact your health plan if you have specific questions.
And if you are already in the hospital, you can request to speak with a caseworker or benefits expert who can help you understand your estimated costs.
Having any Further Questions?
Although Medicare benefit periods are not difficult to understand, you can still get assistance. If you have specific questions about Medicare Part A costs or how a service you want will be covered, you can seek advice from the following sources:
- Local state agency. If you have a specific question about your benefit periods, you can contact your insurance company directly.
- SHIP (State Health Insurance Assistance Program). SHIP is dedicated to helping people with Medicare questions both on state and local level. Click here to find the contact information for your state.
Contact your insurance provider if you have a Medicare Advantage (Part C) plan or supplemental insurance, such as Medigap coverage.
How can Medicare Benefit Period Costs be Avoided?
There are two options for eliminating deductibles and copayments:
- Medicare Supplementary plans: Joining Plan G, Plan F, or Plan N would pay your entire Part A deductibles and extra hospital days, as well as 100 percent of days 21 to 100 in the SNF rehabilitation facility if they follow a medical center stay.
- Note: As of 2021, newly eligible Medicare enrollees will be unable to enroll in Plan F. Current enrollees, on the other hand, can continue with their coverage and can also switch plans. That is why citizens buy supplements. These policies are also known as Medigap policies.
- Medicare Advantage: Medicare Advantage plan, also known as Part C, programs replace your Medicare Part A and Part B coverage. The policy you select will determine your copayments.
- Medicare benefit periods cover all inpatient care, including stays in a hospital or skilled nursing facility.
- When you have been out of the inpatient care for at least 60 days, you’ll begin a new benefit period.
- You can have unlimited benefit periods within a year and throughout your lifetime.
Medicare Advantage policies have entirely different rules for benefit periods and costs