The ABCs of Medicare: A Simple Guide
New to Medicare? Learn what each part covers, what it costs, and how the pieces fit together so you can make confident enrollment decisions.
What Is Medicare?
Medicare is the federal health insurance program for Americans aged 65 and older, as well as younger people with certain disabilities or End-Stage Renal Disease (ESRD). Established in 1965, Medicare now provides health coverage to over 65 million Americans.
Medicare is divided into four distinct parts — A, B, C, and D — each covering different services. Understanding what each part does is the first step to choosing the right coverage for your needs and budget.
You become eligible for Medicare during a 7-month window around your 65th birthday, known as your Initial Enrollment Period. Missing this window can result in late enrollment penalties that increase your premiums permanently.
Understanding Medicare Parts A, B, C, and D
Each part of Medicare covers specific healthcare services. Here is a clear breakdown of what each part includes.
Part A: Hospital Insurance
Covers inpatient hospital stays, skilled nursing facility care (up to 100 days), hospice, and some home health services. Most people qualify for premium-free Part A if they or their spouse paid Medicare taxes for at least 10 years.
2026 Deductible: $1,736 per benefit period
Part B: Medical Insurance
Covers doctor and specialist visits, outpatient procedures, preventive screenings, lab work, diagnostic imaging, and durable medical equipment. Part B has a monthly premium that most beneficiaries pay.
2026 Premium: $202.90/month (income-adjusted)
Part C: Medicare Advantage
An all-in-one alternative to Original Medicare offered by private insurers approved by Medicare. These plans must cover everything Parts A and B cover, and most include prescription drug coverage. Some plans may offer additional benefits not covered by Original Medicare. Benefits, costs, and provider networks vary by plan.
Premiums vary by plan (you still pay the Part B premium)
Learn more about Medicare Advantage →Part D: Prescription Drug Coverage
Helps cover the cost of prescription medications through private insurance plans. Each plan has its own formulary (list of covered drugs), premiums, and cost-sharing. Available as a standalone plan with Original Medicare or built into many Medicare Advantage plans. Delaying enrollment without creditable coverage may result in a late penalty.
2026 Avg. Premium: ~$39/month (varies by plan)
Learn more about Part D →Original Medicare vs. Medicare Advantage: Which Is Right for You?
The biggest decision in Medicare is choosing between Original Medicare (Parts A + B + Supplement) and Medicare Advantage (Part C). Here is how they compare.
| Feature | Original Medicare + Supplement | Medicare Advantage (Part C) |
|---|---|---|
| How It Works | Government-run; add a Supplement for gap coverage and Part D for drugs | Private insurer bundles everything into one plan |
| Doctor Freedom | Any Medicare-accepting doctor nationwide | Must use plan network (HMO/PPO) |
| Monthly Premium | Part B premium + Supplement premium | Part B premium + plan premium (varies by plan) |
| Drug Coverage | Requires separate Part D plan | Usually included in plan |
| Additional Benefits | Not included under Original Medicare | May include additional benefits not covered by Original Medicare |
| Out-of-Pocket Max | With Plan G: very low annual out-of-pocket | Capped by CMS (max ~$9,250 in-network) |
| Referrals Needed | No | HMO plans may require referrals |
| Best For | Those wanting maximum flexibility and predictable costs | Those wanting bundled coverage in a single plan |
When Can You Enroll in Medicare?
Timing matters with Medicare. Enrolling at the right time avoids penalties and ensures seamless coverage.
Initial Enrollment Period (IEP)
7 months surrounding your 65th birthday (3 months before, your birth month, 3 months after). This is when you first sign up for Medicare Parts A and B.
Annual Enrollment Period (AEP)
October 15 – December 7 each year. Switch Medicare Advantage plans, return to Original Medicare, or change your Part D drug plan. Changes take effect January 1.
Special Enrollment Periods (SEP)
Qualifying life events — like moving, losing employer coverage, or gaining Medicaid — trigger a special window to make changes outside of regular enrollment periods.