How Medicare Works
Medicare is divided into four main parts, each covering different aspects of healthcare:
Part A – Hospital Coverage
- Covers inpatient hospital stays, skilled nursing facility care, hospice services, and limited home health care.
- Most people don’t pay a premium for Part A if they or their spouse paid Medicare taxes while working.
- You are still responsible for deductibles and coinsurance for certain services.
Part B – Medical Coverage
- Covers doctor visits, outpatient care, preventive services, and certain medical supplies.
- You pay a monthly premium for Part B, which can vary based on income.
- There is also an annual deductible and coinsurance (typically 20% of approved costs).
Part C – Medicare Advantage Plans
- Offered by private insurance companies approved by Medicare.
- Combines Parts A and B, and often includes prescription drug coverage, dental, vision, hearing, wellness programs, and other benefits not covered by Original Medicare.
- Costs, networks, and benefits vary by plan.
Part D – Prescription Drug Coverage
- Helps cover the cost of prescription medications.
- Available as a stand-alone plan (to pair with Original Medicare) or included in many Medicare Advantage plans.
- Plans have different drug formularies, premiums, and copay structures.
Gaps in Original Medicare
Original Medicare (Parts A & B) does not cover:
- Most prescription drugs
- Routine dental, vision, or hearing care
- Long-term custodial care
- Certain international travel medical costs
To help cover these gaps, you may consider:
- Medicare Supplement Plans (Medigap): Helps pay for deductibles, coinsurance, and copayments.
- Medicare Advantage Plans: May include extra benefits and combine coverage into a single plan.
Enrollment Periods – Don’t Miss Your Window
Enrolling at the right time is crucial to avoid late penalties and gaps in coverage.
- Initial Enrollment Period (IEP): A 7-month window starting 3 months before you turn 65 and ending 3 months after your birthday month.
- Annual Enrollment Period (AEP): October 15 – December 7 each year. You can switch, drop, or add coverage during this time.
- Special Enrollment Period (SEP): Available if you experience certain life changes, such as moving or losing other health coverage.
- Medicare Advantage Open Enrollment Period: January 1 – March 31 each year, allowing you to switch to another Medicare Advantage plan or return to Original Medicare.