If you’ve ever needed the services of a hospital or skilled nursing facility, you may have heard the phrase “benefit period.” This is an important concept in Original Medicare, especially if you have a great need for inpatient care. So, now that we’ve got your attention, you may be wondering: What is a benefit period, and why is it so important?
What is a Benefit Period?
A benefit period is the amount of time you use your Medicare coverage for an inpatient care facility, like a hospital or skilled nursing. A benefit period starts when you enter the facility and your coverage begins. It continues until you’ve ceased to receive care for 60 consecutive days.
A benefit period starts when you enter the facility and your coverage begins, and ends when you’ve stopped care for 60 straight days.
If you leave an inpatient facility, but reenter one before 60 days have passed, the benefit period continues. So, if you leave the hospital but are back in after a week, it’s still the same benefit period. Even if you’re out of the hospital for 59 days, it’s still the same period.
On the other hand, if you leave a facility, but reenter a facility on the 61st day, a new benefit period will begin. There is no limit on how many benefit periods you can have. That said, if you need inpatient care, don’t try to wait it out until you enter a new benefit period. Your health is more important than saving some money.
Why Is It Important?
Benefit periods are so important because they define the costs of your coverage. Whenever a new period begins, you’ll pay an inpatient deductible. This deductible is $1,408 in 2020. For the first 60 days of your benefit period, your care is covered by Medicare Part A. After 60 days, you’ll pay a daily coinsurance for your inpatient care. In 2020, these daily costs are $352 for days 61 to 90 in a hospital and $176 for days 21 to 100 in a skilled nursing facility.
If you do go over 90 days at an inpatient facility, you may still have coverage. Everyone on Original Medicare has 60 lifetime reserve days. These reserve days kick in on the 91st day of your stay at an inpatient care facility. These coinsurance costs are $704 each day for 2020. Once the bank of reserve days is used up, you’re responsible for the full costs. The bank doesn’t replenish in a new benefit period either.
Once the bank of reserve days is used up, you’re responsible for the full costs. The bank doesn’t replenish in a new benefit period either.
For example, let’s say that, in one benefit period, you spend 120 days in the hospital, using 30 reserve days. The next year, you spend another 120 days in a skilled nursing facility, using the 30 remaining days. A few months later, you slip and break your leg. Over the course of the hospital stay and rehab, you spend 100 days in the hospital. Days one to 60 will still cost nothing once you meet the Part A deductible, and the coinsurances for days 61-90 will stay the same (though they may change between years). But after that 90th day, you’re responsible for the full cost of your inpatient care.
Do I Have Other Options?
If you want extra help with your inpatient care, there are options you can look into. One is a Medigap plan that covers hospital or skilled nursing facility coinsurance. All Medigap plans will cover Part A coinsurances and hospital costs for a year after Medicare benefits end. Most plans will also cover at least a portion of skilled nursing facility care coinsurances. Only Plans A and B offer no coverage, while Plans K and L offer a percentage (50 percent and 75 percent respectively) of coverage.
Many Medicare Advantage plans offer some form of hospital or skilled nursing facility coverage.
It may also be worth investigating a Medicare Advantage plan. Many Medicare Advantage plans offer some form of hospital or skilled nursing facility coverage. This coverage differs from plan to plan, though.
If this coverage is important to you, we recommend working with a licensed sales agent who can help you choose a plan. Whether you’re looking for a Medigap or Medicare Advantage plan, the Medicareful Plan Finder tool can help you find one.
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If you find yourself admitted to an inpatient care facility, it’s reassuring if you know your Medicare plan will cover your needs. Understanding what is covered, and when it’s covered, is critical to ensuring you’re never caught with shocking charges. This is why knowing your benefit periods is so important.