Medicare can feel like alphabet soup at first. But once you understand what each part covers, it becomes much clearer. Here's the breakdown of all four parts and how they work together.
Quick Comparison
| Part | What It Covers | Monthly Cost | Required? |
|---|---|---|---|
| Part A | Hospital, skilled nursing, hospice | $0 for most people | Yes (automatic at 65) |
| Part B | Doctor visits, outpatient, preventive | $174.70+ (2024) | Strongly recommended |
| Part C | All-in-one alternative (A+B+usually D) | $0 to $100+ (varies) | Optional alternative |
| Part D | Prescription medications | $15-$100+ (varies) | Optional but recommended |
Part A: Hospital Insurance
Part A Hospital Insurance
What it covers:
- Inpatient hospital stays
- Skilled nursing facility care (up to 100 days after a hospital stay)
- Hospice care
- Some home health care services
Cost: Most people pay $0 in monthly premiums if they (or their spouse) worked and paid Medicare taxes for at least 10 years (40 quarters). However, there are deductibles and copays when you use services.
Part A kicks in when you need serious medical care. The 2024 Part A deductible is $1,632 per benefit period. A benefit period starts when you enter the hospital and ends 60 days after you stop receiving inpatient care.
Part B: Medical Insurance
Part B Medical Insurance
What it covers:
- Doctor and specialist visits
- Outpatient care and surgery
- Preventive services (many at no cost)
- Lab tests and X-rays
- Durable medical equipment (wheelchairs, walkers)
- Mental health services
- Ambulance services
Cost: The standard monthly premium is $174.70 in 2024 (higher for those with higher incomes). There's also a $240 annual deductible, then you typically pay 20% coinsurance.
Unlike Part A, Part B requires a monthly premium. If you don't sign up during your Initial Enrollment Period (3 months before to 3 months after turning 65), you may pay a late enrollment penalty of 10% for each 12-month period you delayed.
If you're still working at 65 with employer coverage, you can delay Part B without penalty. But sign up for Part A since it's free. When your employer coverage ends, you'll have 8 months to enroll in Part B penalty-free.
Part C: Medicare Advantage
Part C Medicare Advantage
What it is: An all-in-one alternative to Original Medicare offered by private insurance companies approved by Medicare.
What it covers:
- Everything Part A covers
- Everything Part B covers
- Usually includes Part D (prescription drugs)
- Often includes extras: dental, vision, hearing, fitness
Cost: Many plans have $0 monthly premiums (you still pay Part B premium). Plans have out-of-pocket maximums, which Original Medicare lacks.
Medicare Advantage plans work like HMO or PPO plans. You typically need to use doctors in the plan's network. About half of all Medicare beneficiaries now choose Medicare Advantage.
Learn more about Medicare Advantage
Part D: Prescription Drug Coverage
Part D Prescription Drugs
What it covers:
- Prescription medications (each plan has its own formulary)
- Vaccines not covered by Part B
Cost: Premiums vary widely by plan ($15 to $100+ per month). Most plans have deductibles and copays that vary by drug tier.
If you have Original Medicare (Parts A and B), you'll need to add a standalone Part D plan for drug coverage. If you don't enroll when first eligible and don't have other creditable coverage, you'll pay a permanent late enrollment penalty.
Which Parts Do You Need?
There are two main paths:
Path 1: Original Medicare + Part D + Medigap
- Part A + Part B (Original Medicare)
- Add Part D for prescriptions
- Consider a Medicare Supplement (Medigap) to cover deductibles and coinsurance
- See any Medicare provider nationwide
Path 2: Medicare Advantage
- Part C covers everything (usually including drugs)
- Often includes extra benefits
- Use network providers
- Built-in out-of-pocket maximum
Need Help Choosing the Right Medicare Path?
Our team can explain your options and help you find the best fit for your healthcare needs and budget.
Get Free GuidanceFrequently Asked Questions
Is Medicare Part A really free?
Part A is premium-free if you or your spouse worked and paid Medicare taxes for at least 10 years. If you haven't worked enough quarters, you can still buy Part A, but premiums can reach $506 per month in 2024.
Can I have Part C and Part D at the same time?
Most Medicare Advantage (Part C) plans already include prescription drug coverage. If yours does, you don't need a separate Part D plan. Some Part C plans don't include drugs, in which case you can add a standalone Part D plan.
What's not covered by any part of Medicare?
Original Medicare doesn't cover long-term care, dental, vision, or hearing aids. Medicare Advantage plans often include these benefits. For long-term care, you may need separate insurance or Medicaid.
When should I sign up for Medicare?
Your Initial Enrollment Period is 7 months: 3 months before your 65th birthday, your birthday month, and 3 months after. Missing this window can result in gaps in coverage and permanent late penalties.