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Experience April/May 2024

Lifetime Reserve to the Rescue—of Your Wallet

Leasha West


  • If your Medicare benefits run out but you still need care, lifetime reserve days can help.
  • Lifetime reserve days provide 60 days of additional coverage under Medicare Part A but can only be used once during your life.
  • A Medicare supplement policy can provide an additional 365 days if you exceed your 60 Medicare lifetime reserve days.
  • Lifetime reserve days can’t be used at skilled nursing facilities or psychiatric hospitals.
Lifetime Reserve to the Rescue—of Your Wallet
Hammarby Studios via Getty Images

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Most of us don’t want to be in the hospital any longer than necessary; however, what happens when your Medicare benefits run out but you still need care? Although it’s a rare occurrence, this does happen. This is where a little-known benefit called lifetime reserve days kicks in.

Let’s get right into it.

What you pay for hospital stays

When you’re admitted to a hospital or long-term care facility, it’s important to understand what your costs are and your coverage is. With original Medicare, most people don’t pay a monthly premium for Part A, which covers your eligible hospital admission for each 90-day benefit period. Your costs for an in-patient hospital stay will depend on how long you were admitted.

The deductible for 2024 is $1,632, and the daily coinsurance during those 90 days breaks down like this:

Days 1-60 $0

Days 61-90 $408

Days 91+ $816

Keep in mind that the coinsurance and deductibles change every year. Also be aware that you might have an extra cost if your doctor orders a service or treatment that’s not covered by Medicare. It does happen, so be mindful of anything additional your doctor is requesting.

Normally, the average hospital stay is 4.6 days; however, in the unfortunate event that an in-patient admission reaches 90 consecutive days, there’s a one-time bank of 60 lifetime reserve days available. It’s important to know that Medicare has specific rules surrounding lifetime reserve days. No surprise there.

These lifetime reserve days are called lifetime for a reason. These coveted 60 days are a one-time-only coverage under Medicare Part A for lengthy hospital stays that can only be used once anytime during your life.

When these days are used up, that’s it. They don’t renew. Granted, the standard coverage limit is 90 days, which means most people won’t even come close to using their lifetime reserve days.

Here are 10 things more to know about lifetime reserve days.

1. Who’s eligible? To be able to access the lifetime reserve days, you must carry Medicare Part A and be eligible for in-patient hospital care. Next, your doctor must put in an order that you need at least 3 midnights of medically necessary in-patient hospital care for your condition. The 3 midnights means 3 consecutive 24-hour days. And finally, you must be formally admitted to the hospital.

Outpatient care doesn’t qualify for lifetime reserve days. Once you’re admitted, your in-patient hospital service must span 90 consecutive days in one benefit period. The hospital will typically notify you one week before the expiration of your Medicare coverage for hospital days to help you prepare for the next phase.

2. Timing is everything. You have discretion in applying your lifetime reserve days. You may choose not to use your lifetime reserve days and, instead, save them for a later hospital confinement. But this carries great risk since you may never qualify to use the lifetime reserve days again in your life.

Exhausting an entire 90-day in-patient benefit period is a rarity. Additionally, you don’t have to use all the lifetime reserve days for the same hospital stay.

For instance, you may have one in-patient hospital benefit period in which you used nine lifetime reserve days. Then two years later, under another long hospitalization period, you may choose to use nine more lifetime reserve days. In this example, the first 9 days left 51 remaining days, and the next 9 days attached to the second stay now leaves 42 days.

If you elect not to use your lifetime reserve days, you must submit that communication in writing to the hospital. Your notification must be received within 90 days after you’re discharged from the hospital.

3. Co-insurance and co-payment kicks in. Medicare Part A hospital coverage still has a daily co-insurance to accompany lifetime reserve days. For 2024, each lifetime reserve day has a co-payment of $816 per day. After the lifetime reserve days are gone, you’re responsible for all hospital costs in full.

Let’s look at an example of the costs for an entire 90-day hospital benefit period with all 60 lifetime reserve days used. For a total of 150 days: Day 1–60 will be the deductible of $1,632 and $0 co-pay; day 61–90, the $408 daily co-pay will equal $12,240. Then the 60 lifetime reserve days 91–151 at $816 per day adds up to $48,960. Together, the grand total for your portion of the hospitalization would cost $62,832. Yikes!

Let’s say you were discharged and were out of the hospital for at least 60 days, then admitted to the hospital again. Under this situation, a new 90-day in-patient hospital benefit period would start, along with a new $1,632 deductible.

If you had to stay for longer than 90 days, there wouldn’t be any more lifetime reserve days available. Therefore, the hospital would bill you in full for all the days you stay past your 90-day limit. Although this is a worst-case scenario, there are other ways to cover an extended hospital confinement—enter, supplemental plans.

4. Medicare supplements to the rescue (sort of). These plans are offered through private insurance companies and aren’t officially part of Medicare. That said, they’re standardized by the federal government, and each plan is identical in coverage.

All cover the Part A hospital co-insurance, and some may pay all or part of your Part A deductible. When using the 60 lifetime reserve days, all 10 standardized Medicare supplement plans A, B, C, D, F, G, K, L, M, N will cover the daily co-insurance.

5. There’s always a way. Want more lifetime reserve days, just in case? Your Medicare supplement policy provides an additional 365 days that can be used if you exceed your 60 Medicare lifetime reserve days.

This is a huge advantage in carrying a Medicare supplement plan versus a Medicare Advantage policy. Depending on your health, you should weigh this stark difference of additional lifetime reserve days when you’re deciding between the two plan types.

6. Read your Advantage plan. Similar to Medicare supplement insurance, Medicare Advantage (Part C) is also offered by private insurance companies. Plans do provide at least the same benefits as original Medicare parts A and B.

However, it’s important to consult with your specific insurance provider and to study your summary of benefits to learn what your specific costs would be if you had to stay past the 90-day in-patient hospital period.

7. Check out hospital indemnity insurance. Another option to assist with out-of-pocket costs and provide more hospitalization insurance is a hospital indemnity plan. This is a separate, stand-alone policy from your original Medicare and Medicare supplement or Medicare Advantage plan that specifically covers a predetermined benefit for each hospital stay.

Some policies can pay a daily benefit amount for up to one year. The monthly premium of a hospital indemnity plan will depend on the insurance carrier and the plan you select. Moreover, some of the factors that determine your monthly premium are your gender, age, whether you smoke, your geographic location, the deductible amount, and the selected waiting period.

With a hospital indemnity plan, the claim is paid directly to the policyholder, not the hospital. Depending on your health and history of hospitalization, this type of insurance is certainly worth considering.

8. About rehab and skilled nursing. It’s important to know the difference between an in-patient rehab facility and a skilled-nursing facility and to decipher which is the best option for care depending on your need and your expected recovery. And more importantly, by reasonably speculating on your anticipated length of stay.

For example, if a massive stroke renders a patient completely paralyzed on their left side, recovery will likely take more than 100 days of therapy. If so, an in-patient rehab facility may be more appropriate in accessing the patient’s lifetime reserve days. Even better, if the patient has a Medicare supplement policy, remember that another 365 lifetime reserve days are available to continue receiving therapy and aiding with recovery.

An in-patient rehab center aims to restore the patient with the intent of returning home. It involves a minimum of three hours of intensive therapy per day for typically five days a week. This includes all three disciplines of physical therapy, occupational therapy, and speech therapy.

Therapies are administered by licensed therapists who specialize in meeting a patient’s rehabilitation needs. Sessions will incorporate specialized equipment and advanced technology to maximize the effectiveness of the rehabilitation process. The rehabilitation center itself is considered a hospital, which is covered under Medicare Part A. The 90-day benefit period applies to this type of facility.

This is an important distinction from a skilled-nursing facility. Patients in an in-patient rehab center are under a doctor’s supervision, along with nurses administering acute care. In addition, there’s access to other specialists, including dietitians, psychologists, and social worker services. Some facilities offer educational classes to family members to help continue rehab when the patient returns home.

9. The skinny on skilled nursing. An alternative to the rehab facility is a skilled-nursing facility. Following a consecutive hospital stay of at least 3 midnights, a patient can transfer to a skilled nursing center for more care within 30 days of being discharged. This type of facility isn’t considered a hospital, and lifetime reserve days don’t apply.

Skilled nursing includes custodial care, which is assistance with getting in and out of bed, eating, bathing, and toileting, to name a few. Rehabilitation is offered with physical therapy, occupational therapy, and speech therapy but on a limited basis. Therapy sessions in a skilled-nursing facility aren’t nearly as intense, and facilities usually don’t have the type of equipment you’ll see in an in-patient rehab facility. Patients are more often cared for by certified nurse aides and aren’t under a doctor’s supervision.

A skilled-nursing center is needed if the patient’s condition is expected to improve, but they shouldn’t go home because they still require professional medical treatment and 24-hour supervision.

Under Medicare Part A, a skilled-nursing center is covered for up to 100 days. After those days are up, the patient is responsible for all charges. Bear in mind that staying in a skilled-nursing facility and receiving services is contingent on the patient’s continued progress.

Once a patient hits a plateau, is no longer making progress, or refuses to participate in the therapy sessions, the facility will issue a cut-off notice in writing. Thus, not everyone is guaranteed 100 days even though it’s covered by Medicare. The patient does have the right to appeal a premature discharge notice.

All that said, keep these two critical alerts in mind:

Warning 1: When searching for an in-patient rehab facility, don’t rely on information or assurances from any case manager, admissions director, or any other facility personnel. Consult with Centers of Medicare and Medicaid directly to confirm the exact designation of the facility—whether in-patient rehab or skilled nursing—of each facility prior to scheduling a visit. Believe me, this isn’t a lesson you want to learn.

Warning 2: Lifetime reserve days aren’t accepted and can’t be used at skilled-nursing facilities or psychiatric hospitals. Read the warning above! It’s critical to understand the specific designation of each facility before you transfer or are admitted.

Health isn’t one size fits all, and an in-patient hospitalization is different for everyone. Some hospital stays are predictable and planned, but others are sudden and unexpected. With the average stay less than a week, most people will be discharged from the hospital before they even hit the Day 61 co-pay phase.

Nevertheless, it should be a relief to know that you have multiple options for covering the cost of an extended hospital confinement if this unforeseen situation occurs and that lifetime reserve days are available to rescue your wallet.