Medicare 101 · 02

Parts A, B, C & D—explained.

Medicare has four parts: Part A covers hospital stays, Part B covers doctor visits and outpatient care, Part C (Medicare Advantage) bundles A, B, and usually D into a single private plan, and Part D covers prescription drugs. The four parts aren't plans you stack on top of each other — they're labels for different categories of coverage you choose between or combine.

Part A — Hospital insurance

Covers inpatient hospital stays, skilled nursing facility care (after a 3-day hospital stay), hospice care, and some home health services.

• Premium: $0 for most people (if you or your spouse paid Medicare taxes for 10+ years / 40 quarters). Otherwise up to $565/month in 2026.
• Deductible: $1,736 per benefit period in 2026 (not annual—per hospital admission).
• Coinsurance: $0 for days 1–60, then $434/day for days 61–90.

Part B — Medical insurance

Covers doctor visits, outpatient procedures, lab work, durable medical equipment (walkers, oxygen), preventive screenings, mental health, and limited prescriptions administered in a clinical setting.

• Premium: $202.90/month in 2026 (standard). Higher for high earners (Income-Related Monthly Adjustment Amount (IRMAA)).
• Deductible: $283 per year in 2026.
• Coinsurance: 20% of Medicare-approved cost for most services—no out-of-pocket cap. This is the gap people fill with Medigap or Medicare Advantage.

Part C — Medicare Advantage

An alternative way to get your Part A and Part B (and usually D) coverage—through a private plan instead of Original Medicare. You still have to be enrolled in A and B and keep paying the Part B premium.

• Premium: Often $0 (in addition to Part B). Some plans have a small premium.
• How it works: The carrier covers everything Original Medicare would, plus typically prescription drugs, often dental/vision/hearing/fitness extras.
• Trade-off: Network restrictions (HMO/PPO), prior authorization, plan-set out-of-pocket maximum (capped by Centers for Medicare & Medicaid Services (CMS) at $9,250 in-network in 2026).

Full Medicare Advantage breakdown →

Part D — Prescription drug coverage

Sold by private carriers and approved by Medicare. You pick a plan based on the specific drugs you take. Either standalone (paired with Original Medicare) or built into a Medicare Advantage plan.

• Premium: Average around $39/month in 2026—varies by plan and zip code.
• 2025 change: Annual out-of-pocket capped at $2,100 (Inflation Reduction Act). Donut Hole eliminated.
• Late-enrollment penalty: Permanent if you go 63+ days without creditable drug coverage after becoming eligible.

Full Part D breakdown →

How they fit together — the 4 paths

Once you're enrolled and have your red-white-and-blue Medicare card, you show it (or your Medicare Advantage card) at the doctor or hospital. The provider bills Medicare or your plan. You pay any deductible, copay, or coinsurance owed. Behind the scenes, a lot of paperwork moves between Medicare, your plan, and your provider—but for you, it usually just looks like presenting a card.

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