Medicare 101
The four parts, and what each one actually pays for
Medicare is not a single plan. It is four parts that combine in two main ways, and understanding that structure makes every later decision easier.
Parts A, B and C
Part A — hospital
Inpatient hospital stays, skilled nursing after a qualifying stay, hospice and some home health care. Most people pay no premium because they paid in through payroll taxes.
Part B — medical
Doctor visits, outpatient care, lab work, preventive services and durable medical equipment. Part B has a monthly premium, and higher earners pay a surcharge.
Part C — Advantage
A private plan that delivers your Part A and Part B benefits in one package, usually with drug coverage and extras bundled in. You still pay your Part B premium.
Part D and prescription drugs
Part D is prescription drug coverage. You can get it as a standalone plan alongside Original Medicare, or built into a Medicare Advantage plan.
Every Part D plan has its own formulary — the list of drugs it covers and what tier each one sits on. Two plans with similar premiums can differ by thousands of dollars a year for the same person, purely because of how they treat one medication.
There is also a late enrollment penalty for going without creditable drug coverage, and it is permanent. If you don’t take a drug today, a low-cost plan still usually beats no plan at all.
The two paths
Almost everyone ends up on one of two paths, and the choice between them is the single biggest Medicare decision you’ll make.
Path one — Original Medicare plus supplements. You keep Part A and Part B, add a Medicare Supplement to cover the gaps, and add a standalone Part D plan for drugs. Higher monthly cost, very predictable care costs, any provider who accepts Medicare.
Path two — Medicare Advantage. One private plan handles everything, usually including drugs and often with dental, vision and hearing. Lower monthly cost, costs at the point of care, and a network that determines who you can see.
The numbers that matter
- The monthly premium, which is the one everybody looks at
- The deductible before coverage starts
- Copays and coinsurance at each visit
- The maximum you could pay in a bad year
- Whether your doctors and drugs are covered
Timing
The enrollment windows
Initial Enrollment Period
Seven months around your 65th birthday — three before, your birthday month, and three after. This is when most people enroll for the first time.
General Enrollment Period
January 1 to March 31, for people who missed their initial window. Late enrollment penalties may apply.
Annual Enrollment Period
October 15 to December 7 every year. This is when you can change Advantage or Part D coverage for the year ahead.
Medicare Advantage Open Enrollment
January 1 to March 31, for people already on an Advantage plan who want to switch or return to Original Medicare.
Special Enrollment Periods
Triggered by life events — losing employer coverage, moving out of your plan’s service area, or your plan leaving the market.
Still not sure where you fit?
That’s normal, and it’s exactly what a first appointment is for. No cost, no obligation, and nothing gets decided in one sitting unless you want it to.