Key Takeaways

• Medicare Part A has a strict structure with coverage limits that can lead to major out-of-pocket costs, especially for long hospital stays or repeated admissions.

• As a PSHB enrollee, understanding how Medicare integrates with your benefits is essential to avoid cost surprises that Part A doesn’t cover beyond day limits or benefit periods.

The First 60 Days Aren’t the Whole Story

Medicare Part A often gives the impression of comprehensive hospital coverage. But here in 2025, many Postal Service Health Benefits (PSHB) participants are finding that assumptions about hospital costs can quickly fall apart once a stay extends beyond 60 days—or if you’re admitted more than once within a year.

Under Medicare Part A, your hospital coverage is structured around benefit periods. Each benefit period starts the day you’re admitted as an inpatient and ends when you’ve been out of the hospital or skilled nursing facility for 60 days in a row. That means you could have more than one benefit period in a single year—and each one resets your deductible and coinsurance responsibilities.

So while Medicare Part A might seem generous at first, it comes with clear and expensive boundaries:

• Days 1–60: Covered in full after the $1,676 deductible (as of 2025).

• Days 61–90: You’re responsible for $419 per day.

• Days 91–150: You enter your 60 lifetime reserve days at $838 per day.

• After 150 days: Medicare pays nothing.

These rules apply per benefit period—not per year—which can make budgeting for unexpected hospital stays unpredictable.

You May Be on the Hook for Repeat Hospitalizations

Hospital readmissions are more common than many retirees expect. You might recover from an illness, go home, and then return weeks later. Each new benefit period restarts the cost-sharing cycle.

If you’re hospitalized in January and again in April, and those two admissions are 60 days apart, Medicare considers them separate benefit periods. That means you’ll pay the full deductible all over again. And if both stays go past 60 days? You’ll also start paying daily coinsurance again.

With hospital deductibles and per-day charges adding up quickly, these costs can strain your retirement income if you’re not prepared.

Skilled Nursing Facility Limits Are Stricter Than You Think

Skilled nursing facility (SNF) coverage under Medicare Part A is another area where limits can catch you off guard. You only qualify for SNF care under Medicare if you:

• Had a prior inpatient hospital stay of at least 3 days, and

• Enter a Medicare-certified SNF within 30 days of discharge.

Even when you meet these criteria, your coverage is capped:

• Days 1–20: Covered in full.

• Days 21–100: You owe $209.50 per day.

• After 100 days: Medicare covers nothing.

This can be especially costly if you have a longer recovery after surgery or a serious illness. As a PSHB retiree, you might assume your plan or Medicare will cover everything—but this is one of the most common points of confusion.

Why Medicare Part A Isn’t Truly Free

There’s a long-standing belief that Part A is free. That’s only partly true.

If you or your spouse paid Medicare taxes for at least 40 quarters (about 10 years), you don’t owe a monthly premium for Part A in 2025. But even without a premium, your financial responsibility under Part A can be substantial:

• Deductibles for every benefit period

• Daily coinsurance after 60 days in the hospital

• Daily coinsurance after 20 days in a skilled nursing facility

• No coverage beyond lifetime reserve days (hospital) or day 100 (SNF)

And if you paid Medicare taxes for less than 40 quarters, you may owe a monthly premium—$284/month for 30–39 quarters, or $518/month for under 30 quarters.

Even when it feels free, Part A has major financial implications if you fall into one of its coverage gaps.

The PSHB Program Doesn’t Automatically Fill the Gaps

The Postal Service Health Benefits (PSHB) program is designed to coordinate with Medicare. Many enrollees assume their PSHB plan will pick up whatever Medicare doesn’t.

But this is only true if you’re enrolled in both PSHB and Medicare Part B. Coordination typically works best when you have both Parts A and B, because:

• Medicare pays first

• Your PSHB plan pays secondary

If you only have Part A, your PSHB plan may treat you as primary, but with rules and coverage limits that differ from how they’d coordinate with Medicare.

Some common misunderstandings include:

• Thinking your PSHB plan will always cover SNF costs beyond 100 days (not always true)

• Assuming your PSHB deductible is waived if Medicare doesn’t pay (depends on your specific plan rules)

• Believing that PSHB automatically covers services Medicare denies (not guaranteed)

In short, if you don’t enroll in Part B, you could face higher out-of-pocket costs and less favorable coordination.

Timing Matters for Both Medicare and PSHB

Here in 2025, if you’re a Medicare-eligible PSHB enrollee, you’re required to enroll in Medicare Part B to maintain your PSHB plan—unless you meet certain exceptions. These include:

• You retired on or before January 1, 2025

• You were already 64 as of January 1, 2025

• You live abroad

• You have VA or Indian Health Service benefits

If you don’t fall into one of these categories, skipping Part B could lead to termination of your PSHB coverage—or the loss of certain benefits.

This policy exists because PSHB plans are now structured to work in tandem with Medicare. Without both Part A and B, that coordination can’t happen efficiently.

What Happens When You Only Have Part A?

Let’s say you decline Part B and rely only on Part A with your PSHB plan. Here’s what could happen:

• You pay the Part A deductible and coinsurance out of pocket

• Your PSHB plan acts as the primary payer—but with plan-specific cost-sharing

• You’re responsible for services Medicare wouldn’t cover anyway (like long-term custodial care)

If you go over 60 days in a hospital or over 100 days in a skilled nursing facility, Medicare stops paying—and your costs rise steeply. Some PSHB plans offer limited wraparound coverage, but it’s not automatic, and the amount they pay depends on your specific plan structure.

You could find yourself surprised by:

• Additional hospital copays

• Higher deductibles for non-Medicare-covered services

• Limited out-of-network provider access

How Lifetime Reserve Days Create a False Sense of Security

Many people don’t realize that Medicare Part A gives you just 60 lifetime reserve days for hospital stays beyond 90 days.

These days don’t reset each year. Once you use them up, they’re gone for good.

So if you’re hospitalized for 120 days this year and use 30 reserve days, you’ll only have 30 left—forever. If you need another long stay in the future, you’ll face the full cost after 90 days.

This is one of the most overlooked financial traps in Medicare. If you expect to recover from a major illness using Medicare and PSHB alone, reserve day depletion could leave you unprotected.

Take Control Before the Bills Arrive

Waiting until you’re already hospitalized to think about Medicare Part A limitations can be costly. As a PSHB enrollee, your best protection starts with information:

• Understand what Medicare covers—and what it doesn’t

• Know your PSHB plan’s coordination rules

• Confirm your Medicare enrollment status (especially Part B)

• Prepare for multiple hospitalizations in a year—not just one

Review your annual benefits statements. Read your PSHB plan brochure. If you’re unsure how your plan works with Medicare, speak with someone who is.

Protecting Your Retirement Budget Starts with Awareness

You’ve worked hard for your Postal Service retirement benefits. But those benefits can only protect you when you understand how they interact with Medicare.

Don’t wait for a long hospital stay to expose the cracks in your coverage. Review your plan documents. Ask questions. And most importantly, consider talking with a licensed agent listed on this website to evaluate your specific situation.