Medicare is a federal program that provides health coverage to adults 65 years and older, or under 65 with a disability, no matter the income. Medicare will provide short-term in-home care after a hospital or rehab stay.
Medicare covers up to 100 days of care in a hospital or a skilled nursing facility “SNF” (generally an acute or subacute rehabilitation facility) per spell of illness. The care in the rehab must follow a qualifying hospital stay – an inpatient admission of at least three days in a hospital. This is known as the 3-day rule. An admission for observation does not meet the 3-day rule. If the 3-day rule is not met, then Medicare may pay for short-term outpatient services, outlined below.
Inpatient rehab costs:
- Day 1-60 is usually covered during a benefit period, after the Part A deductible is met
- You pay a per-day charge set by Medicare for days 61–90 in a benefit period
- You may use up to 60 lifetime reserve days for days 91–150 in a benefit period, but must pay a daily coinsurance for these days. The daily coinsurance is usually 20% of the Medicare daily rate ($778/day in 2022). Lifetime reserve days are 60 additional days of coverage that is given for the entire time the patient is on Medicare, but they can only be used once. They do not renew when a new benefit period starts.
- You pay 100% of the cost after day 150 in a benefit period
What is a benefit period?
A benefit period begins when you are admitted for an inpatient stay at a hospital or SNF, and ends when you have been out of the hospital or SNF for 60 days in a row. If you are readmitted to the hospital within 60 days, the benefit period will continue. If it has been more than 60 days since an admission, a new benefit period begins.
Once discharged from the hospital or rehab, Medicare will pay for short-term outpatient services in the home, which include licensed medical services such as:
- Skilled nursing care
- Occupational therapy
- Physical therapy
- Home health aide care
- Speech-language pathology services
- Medical social services
The home health aide services provided are for roughly 1 hour/day, 2-3 days/week, and will end after approximately 2 weeks. Once these services end, any home care that does not require skilled nursing services is considered custodial care.
Custodial care is non-skilled personal care, which consists of helping with Activities of Daily Living (ADLs). The most common ADLs are bathing, dressing, toileting, eating, and ambulation/transfers. Since skilled nursing services are not needed at this time, health insurance will not pay for custodial care.
