Understanding Medicare is essential as you approach age 65. This guide breaks down the four parts and how they work together.
The Four Parts of Medicare
Part A: Hospital Insurance
- Inpatient hospital care
- Skilled nursing facility care
- Hospice care
- Home health care
Cost: Most people pay no premium (if you or your spouse worked 10+ years paying Medicare taxes).
Deductible (2026): $1,676 per benefit period.
Part B: Medical Insurance
- Doctor visits
- Outpatient care
- Preventive services
- Medical equipment
- Mental health services
Cost: Standard premium $185/month (higher for high incomes).
Deductible (2026): $257/year.
Part C: Medicare Advantage
What it is: Private insurance plans that combine Part A, Part B, and usually Part D.
- Often includes prescription drug coverage
- May include extra benefits (vision, dental, hearing)
- Out-of-pocket maximum limits your costs
- Network restrictions
- Need referrals for specialists (HMO plans)
- More complex than Original Medicare
Part D: Prescription Drug Coverage
What it covers: Prescription medications.
- You pay a monthly premium
- Annual deductible (up to $590 in 2026)
- Copays/coinsurance for medications
- Coverage gap ("donut hole") applies at certain spending levels
Original Medicare vs Medicare Advantage
See any doctor who accepts Medicare
Yes ($8,850 limit in 2026)
Need separate Part D plan
Cannot combine with Medigap
When to Enroll
Initial Enrollment Period: 7-month window centered around your 65th birthday
- 3 months before your 65th birthday month
- Your birthday month
- 3 months after your birthday month
Late enrollment penalty: If you don't enroll when first eligible and don't have other coverage, you may pay higher premiums permanently.
Who's Eligible
- Age 65 or older
- Under 65 with qualifying disability
- Any age with End-Stage Renal Disease (ESRD) or ALS
FAQ
Q: Is Medicare free?
A: Part A is typically premium-free. Part B, Part D, and Medicare Advantage have premiums.
Q: Do I need both Part A and Part B?
A: Most people need both. Part B can be delayed if you have employer coverage.
Q: Should I choose Original Medicare or Medicare Advantage?
A: Depends on your needs. Original Medicare = more flexibility. Medicare Advantage = lower costs but networks.
Original Medicare vs Advantage
Original Medicare (A + B) plus optional Medigap and Part D offers broad provider access. Medicare Advantage bundles benefits with networks and annual out-of-pocket caps. You cannot have Medigap and Advantage simultaneously.
Scenario: turning 65 while still employed
Employee has 20+ person group coverage. They may delay Part B without penalty; once they retire, they have eight months to enroll. Compare employer drug coverage against Part D creditable coverage rules before declining B.
Scenario: snowbird with two residences
Spends winters in Florida and summers in Michigan. Original Medicare + Medigap travels nationwide; Advantage network rules differ by county—confirm in-network hospitals in both locations.
FAQ
Q: What does Part A cover? A: Hospital inpatient care, skilled nursing after hospital stay, hospice—not routine dental or drugs.
Q: When do I enroll in Part B? A: Initial Enrollment Period around 65, or when employer coverage ends, to avoid late penalties.
Q: Do I need Medigap? A: Optional but popular for predictable out-of-pocket costs on Original Medicare.
