Key Takeaways

  • Medicare Part A hospital coverage costs are rising in 2025, including higher deductibles and daily coinsurance amounts.

  • Pairing Medicare Part A with your Postal Service Health Benefits (PSHB) plan can still help manage expenses, but you need to understand exactly where gaps remain.

How Hospital Coverage Under Part A Works in 2025

When you first qualify for Medicare, Part A primarily covers hospital stays, skilled nursing facility care, hospice, and some home health services. While it might seem like a “free” benefit since many paid into Medicare taxes during their working years, it is not entirely cost-free once you actually use it.

For 2025, here are the key details:

  • Part A deductible: $1,676 per benefit period.

  • Hospital coinsurance:

    • Days 1-60: $0 (after the deductible is met)

    • Days 61-90: $419 per day

    • Days 91 and beyond: $838 per day for each “lifetime reserve day” (you get up to 60 of these days for your lifetime)

    • After lifetime reserve days are used: You pay all costs.

If you only rely on Part A without additional coverage through your PSHB plan, you could quickly find yourself responsible for significant out-of-pocket costs during longer hospital stays.

Why Hospital Costs Under Part A Keep Increasing

Several factors contribute to the rising costs under Medicare Part A in 2025:

  • Healthcare inflation: Hospitals charge more each year for inpatient services, equipment, staffing, and facility operations.

  • Longer hospital stays: Even though many treatments are moving to outpatient settings, those who are hospitalized often have more complex needs requiring extended care.

  • Policy adjustments: Medicare recalibrates costs annually to align with national healthcare spending trends.

These cost shifts mean that simply relying on “traditional” Medicare could leave you financially exposed if you experience an unexpected hospital stay.

What Your PSHB Plan Helps Cover

Your Postal Service Health Benefits (PSHB) plan can act as a valuable safety net. When you are enrolled in both Medicare Part A and your PSHB plan, the coordination of benefits can help lower what you owe.

Here’s how your PSHB plan typically steps in:

  • Covers Part A deductibles and coinsurance: Many PSHB plans pick up hospital coinsurance amounts Medicare doesn’t fully cover.

  • Extra days of hospital coverage: Some plans extend hospital coverage beyond what Medicare provides.

  • Lower out-of-pocket maximums: Unlike Medicare, PSHB plans have an annual cap on how much you pay in total health care costs.

However, plans vary, and you must review your PSHB plan documents carefully to know exactly what protections you have.

Areas Where You Could Still Owe Money

Even with PSHB and Medicare working together, some costs could still fall to you in 2025:

  • Deductibles: While many PSHB plans cover the Part A deductible, not all do.

  • Hospital admissions not covered by Medicare: Certain hospital stays, such as those for custodial care rather than acute medical conditions, may not qualify for Medicare coverage at all.

  • Out-of-network hospitals: If your PSHB plan has a network and you seek care out-of-network, you may pay more.

  • Observation stays: Time spent in the hospital under “observation” status—not formally admitted as an inpatient—may result in unexpected charges.

Understanding these gaps now can help you plan ahead and reduce financial surprises.

How Hospital Stays Are Counted for Part A

Medicare measures hospital usage in benefit periods rather than calendar years. Here’s how it works:

  • A benefit period starts the day you are admitted as an inpatient.

  • It ends when you haven’t received any inpatient care for 60 days in a row.

  • If you are hospitalized again after 60 days, a new benefit period begins, requiring a new deductible.

This means you could be responsible for multiple $1,676 deductibles in a single year if you have multiple, separate hospitalizations.

Skilled Nursing Facility Care Under Part A

After a hospital stay, you may require skilled nursing facility (SNF) care. In 2025, here’s what you can expect for SNF coverage under Part A:

  • First 20 days: $0 (covered fully after qualifying hospital stay)

  • Days 21-100: $209.50 per day coinsurance

  • Day 101 and beyond: You pay all costs.

A qualifying hospital stay usually means being formally admitted for at least three consecutive days. Not all PSHB plans automatically cover the coinsurance for extended SNF care, so reviewing your specific benefits is essential.

Hospice Care Costs

Medicare Part A covers most hospice care services, but small cost-sharing responsibilities remain:

  • Drugs for symptom control or pain relief: A small copayment, typically no more than $5 per prescription.

  • Respite care: If your caregiver needs a break, Medicare covers short-term inpatient respite care, but you may owe 5% of the Medicare-approved amount.

PSHB plans generally do not replace hospice benefits but can offer additional coverage or benefits around related services.

Home Health Care Coverage

Home health services under Part A have no cost for services themselves, but durable medical equipment (DME) needed as part of home health care typically requires 20% coinsurance under Part B. Your PSHB plan can help cover these costs depending on its structure.

Planning Strategies for 2025 and Beyond

Being proactive about hospital coverage is smart. Here are strategies you might consider:

  • Review your PSHB plan details annually: Open Season typically occurs each year from November to December.

  • Consider Medicare Part B enrollment if not already enrolled: Part B covers many services Part A does not, including doctor services during a hospital stay.

  • Understand observation status: Before accepting a hospital stay under observation, ask if your doctor can admit you formally.

  • Budget for out-of-pocket costs: Even with good coverage, some costs may remain, so setting aside funds can help.

  • Speak with a licensed insurance agent listed on this website: They can help you confirm your plan’s hospital coverage specifics.

Changes to Watch for Beyond 2025

Medicare hospital costs are reviewed annually, and Part A deductibles, coinsurance rates, and benefit structure are subject to change.

  • Out-of-pocket maximums could rise: Though PSHB plans cap your maximums, these caps can increase over time.

  • Coverage rules may evolve: Legislative or administrative changes could alter how hospital stays and related costs are handled.

Keeping up with these updates during Open Season will remain vital to protecting your health and finances.

Preparing for Hospitalization in Today’s Health Care Landscape

With higher hospital costs, it’s crucial to not only rely on Medicare Part A but to actively use your PSHB plan to its full extent.

Simple actions you can take include:

  • Saving plan documents and Medicare notices.

  • Confirming hospital network status before scheduled admissions.

  • Asking care teams about inpatient versus observation status.

  • Planning financially for possible extended hospital stays or skilled nursing needs.

The 2025 landscape demands more attention to details than ever before, but with the right knowledge and preparation, you can protect yourself against the rising costs.

Hospital Coverage Planning: A Critical Part of Your PSHB and Medicare Strategy

Understanding how hospital coverage under Part A is changing in 2025 helps you take control of your future. By combining your PSHB plan with Medicare effectively, you gain stronger protection—but only if you stay informed and proactive. For personalized help reviewing your options or adjusting your plan, get in touch with a licensed insurance agent listed on this website today.