Key Takeaways

• Medicare Part A covers many hospital-related services, but it does not cover everything. Understanding the specific gaps in coverage can help you prepare for unexpected out-of-pocket costs.

• If you’re enrolled in the Postal Service Health Benefits (PSHB) Program, coordinating your PSHB plan with Medicare Part A can reduce financial risk—but only if you know when and how the coverage overlaps.

What Medicare Part A Actually Covers

Medicare Part A is often referred to as hospital insurance. That title alone leads many people to believe it will take care of all hospital-related expenses. While it does cover a broad range of inpatient services, its protection has clear limits. You are covered for:

• Inpatient hospital stays (semi-private room, meals, general nursing, and drugs as part of treatment)

• Skilled nursing facility (SNF) care, following a qualifying hospital stay

• Hospice care for terminally ill patients

• Some home health care services (if medically necessary)

These benefits sound reassuring, and in many situations, they are. However, each of them comes with rules, timelines, and out-of-pocket costs that you must understand to avoid surprise expenses.

What Medicare Part A Doesn’t Cover

Even within its own defined categories, Medicare Part A has exclusions and limits. Here are the most significant gaps:

1. Deductibles and Coinsurance

In 2025, Medicare Part A has a $1,676 deductible for each benefit period. That’s not an annual deductible—it resets every time you’re out of the hospital or skilled nursing facility for 60 days or more. If you go back to the hospital after 60 days, a new benefit period begins, and you’re responsible for another full deductible.

After 60 days in a hospital, coinsurance costs kick in:

• Days 61–90: $419 per day

• Days 91 and beyond: $838 per day using lifetime reserve days (you only get 60 of these total)

• Once lifetime reserve days are used up: You pay all costs

2. Skilled Nursing Facility (SNF) Limits

Medicare Part A only covers skilled nursing care if you meet these strict requirements:

• You must have had a qualifying 3-day inpatient hospital stay

• You must need skilled nursing or therapy services related to the hospital stay

• Care must be in a Medicare-certified facility

If you qualify, Medicare covers:

• Days 1–20: Full cost

• Days 21–100: $209.50 per day

• After 100 days: You pay all costs

Many people incorrectly assume they can get 100 days fully covered. In reality, you must pay coinsurance after day 20.

3. Long-Term Care

Medicare Part A does not cover custodial or long-term care in a nursing home. If you need help with activities of daily living (like bathing or dressing) but do not require skilled care, you’re responsible for the entire cost.

4. Outpatient Services

Part A is inpatient coverage. It doesn’t pay for:

• Emergency room visits if you aren’t admitted

• Observation stays (unless they result in admission)

• Doctor visits

• Diagnostic tests (unless part of an inpatient stay)

All of these are covered under Medicare Part B, not Part A. If you only have Part A, you will face major coverage gaps.

5. Foreign Travel

Medicare Part A provides no coverage for hospital stays outside the United States, with extremely limited exceptions (such as if a foreign hospital is closer than a U.S. hospital during a medical emergency near a border). If you travel frequently, this is a serious consideration.

How PSHB Helps Fill Some of These Gaps

If you’re a Postal Service annuitant or retiree, your PSHB plan can act as a secondary payer to Medicare Part A, assuming you’re enrolled in both. This coordination helps reduce your out-of-pocket exposure, but the structure varies by plan.

Hospital Deductibles and Coinsurance

Most PSHB plans will cover the Part A deductible and some or all of the coinsurance costs. If your PSHB plan has this feature, it prevents you from having to pay the $1,676 deductible or the $419 daily coinsurance after 60 days.

However, this only applies if you are enrolled in both Medicare and your PSHB plan. If you delay Medicare enrollment, you could be responsible for the full cost-sharing amounts.

Skilled Nursing Facility Benefits

Many PSHB plans extend coverage for skilled nursing care beyond the Medicare limits. Some cover the full 100 days without coinsurance. Others may offer additional days beyond the 100-day Medicare limit.

It’s important to read your plan brochure or consult with a licensed agent to understand the exact SNF benefits your PSHB plan offers. Do not assume full coverage.

Custodial Care and Long-Term Support

PSHB plans generally do not cover long-term custodial care either. However, a few may offer limited home health or respite services. For extended care needs, long-term care insurance or personal savings are usually necessary.

Timing Rules That Matter

When combining PSHB with Medicare, enrollment timing plays a critical role. Here are a few scenarios where timing directly impacts your benefits.

Enrolling in Medicare Part A at 65

Most Postal Service retirees are automatically enrolled in Medicare Part A at age 65 if they are receiving Social Security. There is no premium for Part A if you worked 40 quarters (10 years) or more.

If you delay enrollment, you risk:

• Missing the coordination window with PSHB

• Being responsible for inpatient hospital costs Medicare would have covered

PSHB Plans Assume You Enroll in Medicare

As of 2025, PSHB plans are structured to work with Medicare. In fact, Medicare Part B enrollment is required for certain annuitants unless they qualify for an exception.

While Part A enrollment is typically automatic and premium-free, you must ensure your plan knows you’re enrolled so benefits are coordinated properly.

If you are not enrolled in Medicare, PSHB becomes your primary coverage, and cost-sharing may be significantly higher.

Why Medicare Part A Alone Isn’t Enough

Relying on Medicare Part A without Part B or a PSHB plan leaves you exposed to significant financial risk:

• You would be responsible for outpatient care, observation stays, and ER visits

• You could face the full Part A deductible every time a new benefit period begins

• You’d have no coverage for long-term care

While Part A is an essential building block, it cannot stand alone. You need to understand its limitations and how it fits into a broader health strategy.

Common Misunderstandings About Medicare Part A

Several misconceptions about Part A persist. Clearing them up can help you avoid costly mistakes:

• Myth: Part A covers all hospital costs.

  Fact: Only up to a certain number of days, and deductibles/coinsurance apply.

• Myth: Skilled nursing care is covered as long as I need it.

  Fact: It is limited to 100 days and only if conditions are met.

• Myth: Observation stays count toward SNF coverage.

  Fact: They do not. You must be formally admitted for three days.

• Myth: I don’t need additional insurance if I have Part A.

  Fact: Without Part B and PSHB, major categories of care are uncovered.

Action Steps to Protect Yourself

If you want to avoid the financial surprises that come with relying on Medicare Part A alone, here’s what you can do now:

• Confirm your Medicare enrollment status. Make sure you’re enrolled in both Part A and Part B if required by PSHB.

• Coordinate with your PSHB plan. Inform them of your Medicare status so they can act as secondary payer.

• Review your plan benefits. Check whether your PSHB plan covers hospital deductibles, SNF coinsurance, and extended skilled care.

• Plan for long-term care. Medicare and PSHB don’t cover custodial care. Consider separate insurance or savings for that purpose.

• Talk to a licensed agent listed on this website. They can explain how your PSHB benefits align with Medicare and help you understand your costs.

Hospital Coverage Isn’t Automatic Protection

Medicare Part A sounds reassuring at first glance, but the reality is more complicated. While it helps with many hospital-related costs, it includes strict timelines, limits, and exclusions. If you rely on Part A alone, you may be left paying thousands out of pocket.

Pairing Part A with your PSHB plan offers a much stronger layer of financial protection, but only if you enroll at the right time, understand how the coverage coordinates, and prepare for what neither plan will cover. If you’re uncertain about your coverage gaps or the timing of your enrollment, reach out to a licensed agent listed on this website. They can help you map out a plan that meets your real-world needs.