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Medicare is the federal health insurance program for Americans 65 and older. Understanding its parts, costs, and enrollment deadlines can save you thousands of dollars and avoid lifetime penalties.
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The Four Parts of Medicare
| Part | What It Covers | Typical Cost (2026) |
|---|---|---|
| Part A | Hospital, skilled nursing, hospice, home health | Free for most |
| Part B | Doctor visits, outpatient, preventive, equipment | $185/month |
| Part C | Medicare Advantage — combines A+B plus extras | Varies by plan |
| Part D | Prescription drugs | Varies by plan |
Part A: Hospital Insurance
Free for most Americans who paid Medicare taxes for at least 10 years (40 quarters). Covers:
- Inpatient hospital stays (after a $1,676 deductible per benefit period)
- Skilled nursing facility care (up to 100 days)
- Hospice care
- Limited home health care
Part B: Medical Insurance
The standard premium for 2026 is $185/month. Higher earners pay more through IRMAA. Covers:
- Doctor visits and specialist care
- Outpatient procedures
- Preventive screenings (colonoscopy, mammograms, annual wellness visits)
- Durable medical equipment
- Mental health services
Part C: Medicare Advantage
Private insurer plans that replace Original Medicare and must cover everything Parts A and B cover. Most also include prescription drugs, dental, vision, and hearing. Tradeoff: you must use in-network providers.
Part D: Prescription Drug Coverage
Optional but important. Enrolling late causes a permanent lifetime penalty of 1% of the national base premium per uncovered month.
Medigap (Supplement Insurance)
Private policies that cover gaps in Original Medicare — deductibles, coinsurance, copays. They do not work with Medicare Advantage plans.
When to Enroll
Your Initial Enrollment Period (IEP) is a 7-month window: 3 months before your 65th birthday month, your birthday month, and 3 months after. Missing it means waiting for General Enrollment Period (Jan 1 – Mar 31) and potentially paying permanent premium penalties.
Exception: If you have employer coverage through an employer with 20+ employees, you can delay without penalty.
Frequently Asked Questions
When can I enroll in Medicare?
At age 65 during your 7-month Initial Enrollment Period. Missing it can result in permanent late penalties on Part B and Part D premiums.
What does Medicare cover?
Part A: hospital stays and skilled nursing. Part B: doctor visits and outpatient. Part C: both plus extras. Part D: prescriptions.
Medicare vs Medicaid?
Medicare is for people 65+ regardless of income. Medicaid is income-based and covers long-term care Medicare does not.
Does Medicare cover drugs?
Not through Parts A or B. Add Part D or Medicare Advantage with drug coverage. Late enrollment causes a lifetime penalty.
How much does Medicare cost?
Part A is free for most. Part B is $185/month in 2026. Part D and Medigap plans vary.
Information as of May 2026. This is for educational purposes only and not personalized financial advice. Consult a licensed professional for your specific situation.