Medicare Part A billing

Medicare Part A is the hospital insurance component of the program. Its billing scope centers on services furnished by institutional providers rather than by individual practitioners. Broadly, facilities bill on the institutional claim for inpatient hospital care, care in a skilled nursing facility following a qualifying stay, home health services, and hospice care. Coverage of home health in particular is shared between Part A and Part B depending on the beneficiary's circumstances, even though home health agencies submit it on the institutional claim. How these settings fit together within the wider program is described in how Medicare is structured, which contrasts Parts A, B, C, and D.

A defining feature of Part A is the separation between the facility (institutional) charge and the professional charge. A hospital stay commonly generates a Part A institutional claim for the facility resources and separate Part B professional claims for the physicians and other practitioners who treat the patient. Understanding which portion belongs on which claim is fundamental to accurate institutional billing.

Inpatient hospital

Acute-care facility services during a formally admitted inpatient stay, generally paid under an inpatient prospective payment system.

Skilled nursing facility (SNF)

Skilled nursing and rehabilitation services, typically following a qualifying inpatient hospital stay, subject to CMS coverage conditions.

Home health

Intermittent skilled services furnished in the home under a plan of care, billed institutionally by home health agencies; Medicare coverage of home health falls under both Part A and Part B depending on the beneficiary's circumstances. Payment under either part depends on a physician or allowed practitioner certifying eligibility, which includes the home health face-to-face encounter — a requirement that sits in the certifying practice's record rather than the agency's.

Hospice

Palliative care for beneficiaries who elect the hospice benefit, paid on setting-specific per-diem rates.

Which procedures Medicare will pay for only as an admitted stay is a separate question from what Part A covers, and it has its own answer: the inpatient-only list, which CMS is eliminating on a three-year schedule that began in 2026. While a procedure remains on it, the outpatient payment system will not pay for the service at all, so the institutional claim described below is the only route to payment.

Part A facilities generally report services on the institutional claim — the paper UB-04 form or its electronic 837I equivalent — which differs structurally from the CMS-1500 used for professional services. The institutional claim carries facility-level data such as revenue codes, condition and occurrence codes, patient status, and the diagnosis and procedure code sets maintained for inpatient reporting.

Completed claims are submitted to the Medicare Administrative Contractor assigned to the facility's geographic jurisdiction. The MAC receives, edits, and adjudicates the claim, issues the remittance advice (ERA), administers coverage policy locally, and performs the first level of appeal — the redetermination — under nationally set rules. Because MAC jurisdiction assignments and local policies vary, the applicable contractor and its instructions should be confirmed rather than assumed.

Part A does not generally pay a separate fee for each line item. Instead, CMS uses setting-specific prospective payment systems that group services and pay a predetermined amount based on factors such as diagnosis, resource use, and length of stay. The mechanics of these systems and how rates are established are explored in Medicare fee schedules explained.

Beneficiary cost-sharing under Part A is organized around benefit periods and includes deductibles and, for longer stays, coinsurance. The benefit-period structure and the day limits on each benefit come from the Medicare statute and are not reset each year; what does change on a published annual schedule is the inpatient hospital deductible and the coinsurance amounts derived from it, which CMS promulgates in advance of the year they apply to. Because those amounts change and differ by setting, current values must be verified against official CMS sources rather than stated as fixed.

Before billing, a facility confirms the beneficiary's Part A entitlement and captures the current Medicare Beneficiary Identifier (MBI). General practices for confirming coverage are covered in verifying Medicare eligibility, and eligibility verification is a recurring safeguard against downstream denials.

The facility itself must hold active Medicare billing privileges. Institutional enrollment follows CMS processes, discussed in Medicare enrollment and billing privileges, and depends on provider enrollment records maintained in PECOS. Where another insurer pays before Medicare, Medicare Secondary Payer (MSP) rules and coordination of benefits determine billing order.

1. 01

   Verify entitlement and identity

   Confirm Part A entitlement, the active MBI, and any other coverage that affects payment order.
2. 02

   Confirm facility billing privileges

   Ensure the institution's Medicare enrollment and jurisdiction assignment are current before submission.
3. 03

   Document medical necessity and status

   Support the level of care, patient status, and discharge disposition with the records CMS policy requires.
4. 04

   Submit and reconcile

   File the institutional claim to the MAC, then post and reconcile against the remittance advice.

Part A payment is contingent on medical necessity and on the coverage rules in national and local coverage determinations. These policies, described further in national and local coverage determinations, vary by contractor and change over time, so current policy should be checked for the setting and jurisdiction in question.

When a claim is not paid as expected, the remittance advice explains the adjudication outcome using standardized reason and remark codes. Patterns behind institutional non-payment are discussed in common Medicare billing denials, and each denial carries defined appeal rights.