Medicare Parts A, B, C, and D

Medicare is the federal health insurance program for people 65 and older, and for certain younger people with disabilities. Many people assume it's one simple plan, but it's actually built from parts that cover different types of care — and understanding how they fit together determines what you pay.

Medicare Part A covers hospital stays, skilled nursing facility care, hospice, and some home health care. Most people get Part A premium-free because they or a spouse paid Medicare taxes while working. Part B covers doctor visits, outpatient care, preventive services, and medical supplies. Part B has a monthly premium (income-adjusted) and a yearly deductible.

Original Medicare is the combination of Part A and Part B. It covers a wide range of care but does not cap your out-of-pocket costs, and it doesn't cover most prescription drugs, dental, vision, or hearing. To fill gaps, many people add a Medigap (Medicare Supplement) plan and a Part D prescription drug plan.

Medicare Part C — also called Medicare Advantage — is an alternative sold by private insurers that bundles Part A and Part B benefits, usually includes Part D drug coverage, and often adds extras like dental, vision, and hearing. Advantage plans cap your out-of-pocket spending, making costs more predictable, but they generally use provider networks you must stay within.

Part D is stand-alone prescription drug coverage, available either on its own or built into a Medicare Advantage plan. Every Part D plan has a formulary — its covered drug list — and a tier-based cost structure, so the right plan depends on which prescriptions you take. Enrolling late, without other qualifying coverage, can trigger a permanent penalty on your Part D premium.

The biggest decision is Original Medicare plus Medigap and Part D versus a Medicare Advantage plan. There is no universally better choice — it depends on your doctors, prescriptions, travel habits, and budget. The good news is you typically have a window around your 65th birthday to choose without penalty, and you can revisit the choice every year.