Medicare
The Basics of Medicare
What is Medicare?
Medicare is the federal health insurance program in the United States. It is primarily designed for people aged 65 or older, but it also covers certain younger people with disabilities and those with End-Stage Renal Disease (permanent kidney failure).
Who manages it? The Centers for Medicare & Medicaid Services (CMS).
Who is eligible? U.S. citizens and legal residents who have lived in the U.S. for at least 5 years.
How do you pay for it? It is funded through Social Security and Medicare taxes, as well as monthly premiums paid by beneficiaries.
What are the different parts of Medicare?
Medicare is divided into four main “parts,” each covering specific services.
| Part | Name | What it Covers |
| Part A | Hospital Insurance | Inpatient hospital stays, skilled nursing facility care, hospice, and some home health care. |
| Part B | Medical Insurance | Doctor visits, outpatient care, medical supplies (like wheelchairs), and preventive services (vaccines, screenings). |
| Part C | Medicare Advantage | An “all-in-one” alternative to Original Medicare, provided by private companies. It includes Part A, Part B, and usually Part D. |
| Part D | Prescription Drugs | Helps cover the cost of prescription drugs (including many recommended shots or vaccines). |
How do I choose between Original Medicare and Part C?
Path 1: Original Medicare (Part A & Part B)
This is the traditional “fee-for-service” program managed by the federal government.
Provider Choice: You can see any doctor or visit any hospital in the U.S. that accepts Medicare. No referrals are needed for specialists.
Coverage Gaps: It does not cover most dental, vision, or hearing services.
Financials: There is no “out-of-pocket maximum,” meaning your costs could be high if you have a serious illness. Most people buy a Medigap (Medicare Supplement) policy and a Part D plan to cover these gaps.
Path 2: Medicare Advantage (Part C)
These are private plans (like HMOs or PPOs) that contract with Medicare to provide your benefits.
All-in-One: These plans bundle Part A, Part B, and usually Part D (drug coverage) into one plan.
Extra Perks: Many plans include “extras” like dental, vision, hearing, and even gym memberships (e.g., SilverSneakers).
Network Limits: You are typically restricted to a specific network of doctors and hospitals. You may also need a referral to see a specialist.
Financial Protection: These plans have a mandatory annual out-of-pocket maximum ($9,250 or less in 2026). Once you hit this limit, the plan pays 100% of covered services for the rest of the year.
What is Medicare Supplement (MediGap) ?
Key Features of Medigap
Standardized Plans: In most states, Medigap plans are standardized by letters (Plan A, B, C, D, G, K, L, M, and N). Every “Plan G” offers the exact same benefits regardless of which insurance company sells it—the only difference is the price.
Freedom of Choice: You can see any doctor or specialist in the country who accepts Medicare. You are not restricted to a provider network.
No Referrals: You generally do not need a referral to see a specialist.
Guaranteed Renewable: As long as you pay your premium, the insurance company cannot cancel your policy, even if you develop new health problems.
What Medigap Does NOT Cover
It is important to note that Medigap is not a “catch-all” for every medical expense. It typically does not cover:
Prescription Drugs: You must buy a separate Part D plan for medications.
Long-term care: Such as non-medical care in a nursing home.
Vision or Dental care: Standard plans don’t cover routine exams, glasses, or dentures.
Hearing aids: Or routine hearing exams.
What are Medicare Advantage Health Plans (Part C)?
Medicare advantage, also known as part C, is an “all-in-one” alternative to Original Medicare. These plans are offered by private insurance companies approved by Medicare. If you join a Medicare advantage Plan, you still have Medicare, But you’ll get your Part A (Hospital) and Part B (Medical Insurance) coverage from the Medicare Advantage Plan, not Original Medicare.
Most plans offer coverage for things Original Medicare does not pay for, such as:
- Grocery Allowance
- Dental
- Vision
- Hearing
- Acupuncture
- Transportation
- Worldwide Emergency Coverage
- ETC…