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Calculating Medicare’s hospital deductibles and copays

Anyone going into the hospital knows there will be a bill coming on the way out.  But for Medicare beneficiaries, figuring out this bill can be a challenge. Both Original Medicare and Medicare Advantage charge for hospital stays. We have seen three different models.

  • Per-benefit periodOriginal Medicare follows this model. The Part A coinsurance for 2018 is $1,340 per benefit period.(For days 61-90, the coinsurance is $335 and, for days, 91-150, it is $670.) Many Medigap policies help cover this out-of-pocket amount. Several hospitalizations separated by days or weeks would fall into the same benefit period and be subject to just one coinsurance. However, if there are more than 60 days between one hospital discharge and the next admission, the beneficiary would pay the coinsurance both times.
  • Per-day: A common Medicare Advantage practice is charging a copayment per-day for so many days, no matter how many hospital stays there are in a year. 

Two examples: $285 per day for the first seven days and $375 per day for the first four days.

  • Per-stay: The plan can charge a set amount for each hospital stay, such as $375, or opt for a coinsurance, such as 50% of the cost. 

Just-in-case planning is not an easy task. It’s difficult to predict when a hospitalization will occur, let alone to know how many days it will be and whether there will be a follow-up admission. 

IMPORTANT:  Those who are in and out of the hospital frequently (the "revolving door" as some in the trade call it) will pay considerably more under the per-day model (the common Medicare Advantage method) than the per-benefit period (the Original Medicare method with a Medigap policy).  Beyond that, costs depend on individual circumstances. 

Also know: There is a charge for a Medicare-covered stay in a skilled nursing facility. Medicare covers the first 20 days and, for days 21-100, the copayment is $167.50. Medicare Advantage plans determine their charges. 

Last updated: 08-29-2018