Key Takeaways:

1. Medicare is divided into different parts, each serving a specific purpose to cover healthcare needs.

2. Understanding the costs, coverage, and enrollment timelines for each part of Medicare is essential to making informed decisions.

The Breakdown of Medicare Parts and What They Cover

Medicare is one of the most important healthcare programs for Americans aged 65 and older, as well as for some younger individuals with disabilities. But let’s be real—navigating Medicare can feel like trying to read a map with no legend. You’ve probably heard of Medicare Parts A, B, C, and D, but what do they actually mean? More importantly, which ones do you need?

Let’s dive into the different parts of Medicare and uncover the key details that will help you make the right choices for your healthcare coverage.

Medicare Part A: Hospital Insurance

Medicare Part A is your hospital insurance. It covers inpatient care in hospitals, skilled nursing facility stays, hospice care, and some home health services. If you’ve worked and paid Medicare taxes for at least 10 years (or 40 quarters), you typically don’t have to pay a monthly premium for Part A.

What You Get with Part A

• Hospital Stays: Covers semi-private rooms, meals, and general nursing care.

• Skilled Nursing Facility Care: Short-term care after a hospital stay, but not long-term custodial care.

• Hospice Care: If you have a terminal illness, Medicare covers palliative care and support services.

• Limited Home Health Care: Covers part-time skilled nursing care, therapy services, and other medical needs.

• Blood Transfusions: Covers the first three pints of blood if needed during a hospital stay.

• Post-Hospital Rehabilitation: Includes limited coverage for physical therapy following an inpatient stay.

What You Pay

Even if you don’t have a premium, Part A has out-of-pocket costs, such as deductibles and coinsurance. In 2025, the inpatient hospital deductible is $1,676 per benefit period, and hospital stays beyond 60 days come with daily coinsurance costs.

Important Considerations

Medicare Part A does not cover long-term care, which is a common misconception. Nursing home care is only covered under specific conditions, and if you need assistance with daily living activities, you may need separate long-term care insurance or personal savings. Additionally, if you are admitted to a hospital for observation rather than inpatient treatment, Part A may not cover the stay, leaving you with unexpected expenses.

Medicare Part B: Medical Insurance

Medicare Part B covers doctor visits, outpatient care, preventive services, and medical supplies. It’s your go-to for everyday health needs like checkups, lab tests, and outpatient treatments.

What’s Included?

• Doctor Visits: Routine visits, specialist appointments, and outpatient services.

• Preventive Services: Screenings, vaccines, and annual wellness visits.

• Medical Equipment: Covers wheelchairs, oxygen supplies, and more.

• Mental Health Services: Includes therapy, counseling, and psychiatric evaluations.

• Emergency Room Visits: Covers medically necessary ER visits and urgent care services.

• Durable Medical Equipment (DME): Covers walkers, hospital beds, and CPAP machines.

• Outpatient Surgeries: Includes coverage for necessary procedures performed outside of a hospital.

• Second Opinions: Medicare covers consultations with a different doctor before undergoing a major procedure.

The Cost of Part B

Unlike Part A, almost everyone pays a monthly premium for Part B. In 2025, the standard Part B premium is $185 per month, and the annual deductible is $257. After meeting the deductible, you typically pay 20% of the Medicare-approved amount for most covered services.

What Part B Doesn’t Cover

It’s crucial to know that Part B does not cover routine dental, vision, or hearing services. You may need a separate plan for these benefits if they are important to you. Additionally, alternative treatments such as acupuncture or chiropractic care are only covered in limited circumstances.

Medicare Part C: Medicare Advantage Plans

Medicare Part C, also known as Medicare Advantage, is an alternative way to receive your Medicare benefits. These plans are offered by private insurance companies approved by Medicare and must cover at least the same services as Original Medicare (Parts A and B). Many also include additional benefits, such as dental, vision, and hearing coverage.

Key Features of Part C

• All-in-One Coverage: Combines Parts A and B, often with Part D included.

• Extra Benefits: May offer additional services like gym memberships, telehealth, and transportation.

• Network Restrictions: Many plans require you to use a specific network of doctors and hospitals.

• Potential Cost Savings: Some Medicare Advantage plans offer reduced cost-sharing compared to Original Medicare.

Things to Consider

While Part C offers additional benefits, you still have to pay your Part B premium in addition to any plan-specific costs. Plan availability and costs vary by location, so reviewing your options annually is crucial. Some plans may have higher out-of-pocket maximums, making it important to weigh the long-term costs.

Medicare Part D: Prescription Drug Coverage

If you take prescription medications, you’ll want to understand Medicare Part D. This part of Medicare helps cover the cost of outpatient prescription drugs and is offered through private insurance companies.

What Part D Covers

Each plan has a list of covered medications, known as a formulary. Drugs are typically placed into different tiers, with lower-tier drugs costing less than higher-tier ones.

What You Pay

• Monthly Premium: Varies by plan.

• Annual Deductible: The maximum deductible in 2025 is $590.

• Copayments and Coinsurance: Costs depend on the drug tier and whether you use a preferred pharmacy.

• Catastrophic Coverage: Once your out-of-pocket costs reach $2,000, Medicare covers 100% of drug costs for the rest of the year.

Medicare Part D Changes in 2025

Starting in 2025, there is a $2,000 out-of-pocket cap on prescription drug spending, which significantly reduces costs for those with high medication expenses. Additionally, Medicare now allows enrollees to spread out-of-pocket costs over 12 months through a payment plan.

Enrollment Periods: When Can You Sign Up?

Medicare enrollment isn’t automatic for everyone, so it’s essential to know when to sign up.

• Initial Enrollment Period (IEP): Begins three months before you turn 65, includes your birthday month, and ends three months after.

• General Enrollment Period (GEP): Runs from January 1 to March 31 each year for those who missed IEP.

• Annual Enrollment Period (AEP): From October 15 to December 7, you can switch plans or add coverage.

• Medicare Advantage Open Enrollment Period: From January 1 to March 31, those with a Medicare Advantage plan can switch to another or return to Original Medicare.

Finding Help with Medicare Choices

Medicare can be overwhelming, but you don’t have to figure it out alone. A licensed agent listed on this website can help you compare plans and find one that fits your needs.