What is a benefit period in health insurance

Medicare Part A deductible

Medicare Part A deductible

Copay days 61 to 65

(5 days at $389 each)

Benefit periods measure your use of inpatient hospital and skilled nursing facility (SNF) services. A benefit period begins the day you are admitted to a hospital as an inpatient, or to a SNF, and ends the day you have been out of the hospital or SNF for 60 days in a row. After you meet your deductible, Original Medicare pays in full for days 1 to 60 that you are in a hospital. For days 61-90, you pay a daily coinsurance.

If you have used your 90 days of hospital coverage but need to stay longer, Medicare covers up to 60 additional lifetime reserve days, for which you will pay a daily coinsurance. These days are nonrenewable, meaning you will not get them back when you become eligible for another benefit period.

Medicare will stop paying for your inpatient-related hospital costs (such as room and board) if you run out of days during your benefit period. To be eligible for a new benefit period, and additional days of inpatient coverage, you must remain out of the hospital or SNF for 60 days in a row. When you start a new benefit period, you will also have a new Part A deductible.

Note: Medigap policies A through N pay for your hospital coinsurance and provide up to an additional 365 lifetime reserve days. Additionally, Plans B through N pay some or all of your hospital deductible.

If you are enrolled in a Medicare Advantage Plan, contact your plan to learn about the costs and coverage rules for inpatient care.

This glossary explains terms in the Medicare program.

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Beneficiary and Family Centered Care Quality Improvement Organization (BFCC-QIO)

Centered Care Quality Improvement Organization (BFCC-QIO)—A type of QIO (an organization under contract with Medicare) that uses doctors and other health care experts to review complaints and quality of care for people with Medicare. The BFCC-QIO makes sure there is consistency in the case review process while taking into consideration local factors and needs, including general quality of care and medical necessity.

The way that Original Medicare measures your use of hospital and skilled nursing facility (SNF) services. A benefit period begins the day you're admitted as an inpatient in a hospital or SNF. The benefit period ends when you haven't gotten any inpatient hospital care (or skilled care in a SNF) for 60 days in a row. If you go into a hospital or a SNF after one benefit period has ended, a new benefit period begins. You must pay the inpatient hospital deductible for each benefit period. There's no limit to the number of benefit periods.

Benefits Coordination & Recovery Center

The company that acts on behalf of Medicare to collect and manage information on other types of insurance or coverage that a person with Medicare may have, and determine whether the coverage pays before or after Medicare. This company also acts on behalf of Medicare to obtain repayment when Medicare makes a conditional payment, and the other payer is determined to be primary.

Your benefit period begins the very day you enter a hospital for care or a skilled nursing facility. The benefit period ends when 60 days have passed since you last received either hospital care or care from a skilled nursing facility.

The concept of a benefit period is important because the Medicare Part A deductible is based on the benefit period, rather than a calendar year.

With most other types of health insurance (ie, non-Medicare), the deductible is based on the calendar year. Once you meet it, your plan will pay all or part of your costs for the remainder of the year, but then your deductible resets on January 1. So if you happen to be hospitalized from December 30 to January 2, you’d have to pay two deductibles with most non-Medicare plans.

But with Original Medicare, that sort of scenario would be part of a single benefit period, regardless of the fact that it happens to span two calendar years, and you’d pay your Medicare Part A deductible just once.

However, you could also end up in a situation where you have two benefit periods — and have to pay your deductible twice — in the same calendar year. For example, if you’re hospitalized for a week in March, that would be the start of a benefit period. If you’re discharged and go 60 days without hospital or skilled nursing care, your benefit period would end. But then if you’re hospitalized again in October, you’d start another benefit period, and have to pay another deductible.

The benefit period is to the span of time during which an insurance company pays the policyholder (or the beneficiary named in the insurance policy) a benefit. Defined specially in the policy, it often involves health and disability insurance policies.

Some people also refer to it as a payment period.

A benefit period varies from policy to policy. For example, with Medicare, it begins as soon as you are admitted to a skilled nursing facility or hospital and ends once you have not received care for 60 days in a row. On the other hand, for a long-term care policy, it may begin only after a certain waiting period and last up to a lifetime.

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A benefit period is the length of time during which an insurance policyholder or their dependents may file and receive payment for a covered event. All insurance plans will include a benefit period, which can vary based on policy type, insurance provider, and policy premium.

Most individuals are familiar with the benefit period for healthcare insurance, but disability, long-term care, homeowners, and auto insurance policies also carry a benefit period. 

• A benefit period is the length of time during which an insurance policyholder or their dependents may file and receive payment for a covered event.
• The length of an insurance policy's benefit period will affect the price of the premium because the longer the benefit period, the greater is the insurer's risk.
• The terms of a benefit period can vary, depending on the type of insurance—such as healthcare, disability, long-term care, homeowners, and auto insurance—and whether it's an individual or group plan.

The length of an insurance policy's benefit period will affect the price of the premium because the longer the benefit period, the greater the insurer's risk. Toward the end of the benefit period, the insurer will notify the policyholder of the cost to renew the same coverage for the coming term. For benefit periods to continue uninterrupted, the policyholder must submit the premium payment for the next term before the current coverage expires.

In some insurance policies, the benefit period begins when the insurer accepts the first premium payment—either the full amount due or a scheduled installment. However, other types of policies require that the policyholder finish a waiting or elimination period before the benefit period begins. For example, a long-term disability policy may require a wait of one year before honoring claims for payments. No benefits are payable during any probationary period.

Other programs such as Medicare and Social Security benefits may have a benefit period based on age.

Disability insurance (DI) policies typically offer a range of benefit periods, from as short as two years to a length that extends until the insured reaches age 67. By contrast, a policy with a two-year benefit period will only cover lost income for two years. Most short-term disability policies require a wait of 30 to 90 days for the benefit period to start, while long-term plans may require a one-year delay.

Long-term-care insurance (LTC) and disability policies usually have an elimination period before the benefit period kicks in. These plans come with two-year, three-year, five-year, and unlimited benefit periods. However, long-term care plans may carry additional limitations on daily and lifetime benefits.

Health insurance policies can vary regarding the benefit period they offer depending on if it is a stand-alone policy or one offered through a group, such as an employer. The benefit periods and terms for individual plans are valid for one year before requiring a new premium to continue coverage. For group plans, the benefit periods generally continue as long as the employer continues to pay the premiums. New health insurance plans may require an elimination period, a waiting period, and a pre-existing condition exclusion period before the benefit period begins.

Homeowners' insurance will usually have a benefit period of one year from the stated effective date. New policies may have additional wait periods of 30 to 90 days before coverage goes into effect. During a valid benefit period, a homeowner may file a claim for any covered hazard they may experience.

Automobile insurance will also usually have a benefit period and term of one year before requiring a new premium to continue coverage. Some states may impose waiting periods for new auto insurance coverage. For example, Texas will place a 60-day wait on new auto insurance policies. This period gives the insurance provider time to decide if the driver fits within their risk profiles. The benefit period will begin at the end of any waiting period.