When it comes to Medicare, one of the most common questions is: What is the difference between Medicare Part A and Part B? It’s an important distinction, as these two parts cover different aspects of your healthcare. 

Whether you're enrolling in Medicare for the first time or reassessing your coverage, understanding the roles of Part A and Part B can ensure you get the care you need without unnecessary costs.

What is Medicare Part A (Hospital Insurance)?

Medicare Part A is often referred to as "hospital insurance." This part of Medicare is primarily designed to cover inpatient care in hospitals, but it also extends to other critical services. 

Enrollment:

Most people are automatically enrolled at age 65 if they're receiving Social Security benefits. It's often premium-free for those who have paid Medicare taxes for at least 10 years.

What Part A Covers:

  • Inpatient Hospital Care: Part A covers the costs of your hospital stay, including meals, nursing care, and certain services during your inpatient stay. It’s important to note that while Part A covers a significant portion of your hospital costs, it doesn’t cover everything—you may still have to pay a deductible and coinsurance.
  • Skilled Nursing Facility (SNF) Care: After a qualifying hospital stay, Part A helps cover the costs of a SNF for a limited time. This includes services like physical therapy and other rehabilitation needs.
  • Home Health Care: Part A can cover some aspects of home health care, particularly after a hospital stay, if ordered by a doctor. This includes part-time skilled nursing care and other medical services.
  • Hospice Care: For those with a terminal illness, Part A covers hospice care, focusing on comfort and quality of life. Hospice care can be provided at home or in a hospice facility (Medicare.gov).

Part A Costs:

For most people, Part A is premium-free if you or your spouse paid Medicare taxes for at least 10 years. However, there are other out-of-pocket costs to consider:

  • Deductible: $1,632 per benefit period in 2024
  • Coinsurance: $0 for the first 60 days of a hospital stay, then increasing amounts for longer stays.

What is Medicare Part B (Medical Insurance)?

Medicare Part B is known as "medical insurance." This part focuses more on outpatient services and preventive care. 

Enrollment:

Enrollment is optional, and you must pay a monthly premium.

What Part B Covers:

  • Doctor Visits: Part B covers most of your outpatient services, including visits to your doctor, specialists, and other healthcare providers. This is a significant part of maintaining your health and managing chronic conditions.
  • Preventive Services: A wide range of preventive services are covered, including screenings, vaccinations, and annual wellness visits. Many of these preventative services are provided at no cost to the beneficiary.
  • Outpatient Services: Part B also covers outpatient procedures, lab tests, X-rays, mental health services, and certain home health services that are not covered under Part A.
  • Durable Medical Equipment (DME): Part B helps cover the costs of medical equipment such as wheelchairs, walkers, or oxygen equipment.
  • Ambulance services (in certain situations)
  • Some prescription drugs, particularly those administered by a doctor (like infusions). See the full list of what Part B covers.

Part B Costs:

Unlike Part A, Part B always comes with a premium:

  • Standard monthly premium: $174.70 in 2024 (may be higher based on income)
  • Annual deductible: $240 in 2024
  • Coinsurance: 20% of Medicare-approved costs for most services after meeting the deductible.

Key Differences Between Part A and Part B

  • Focus of Coverage: Part A primarily covers inpatient care, while Part B covers outpatient services and preventive care.
  • Premium Costs: Most people don't pay a premium for Part A, but almost everyone pays a monthly premium for Part B.
  • Enrollment: You're automatically enrolled in Part A when you turn 65 if you're receiving Social Security benefits. However, you may need to actively enroll in Part B.
  • Deductibles: Part A has a per-benefit-period deductible, while Part B has an annual deductible.
  • Provider Choice: With both Part A and B, you can generally see any doctor or use any hospital that accepts Medicare.

Making the Right Choice

When deciding between Medicare Part A and Part B, it's not really a matter of choosing one over the other—they complement each other to provide comprehensive coverage. However, understanding what each part covers helps you plan for your healthcare needs and budget accordingly. Most people enroll in both Part A and Part B when they become eligible for Medicare, but depending on your situation, you might choose to delay Part B if you have other credible coverage, such as through an employer.

Remember, while Original Medicare (Parts A and B) covers many healthcare needs, it doesn't cover everything. You may want to consider additional coverage options, such as Medicare Advantage (Part C) or Medicare Supplement Insurance (Medigap), to fill in the gaps.

If you're looking to learn more about Medicare and how to make the best choices for your health, consider taking a Medicare class on GetSetUp, where you can explore all your options and ask questions.

Reviewed By: Keith Gilbert