Understanding the Parts of Medicare: Brought to You by The A B Cs (and D!)

Who knew that four little letters could cause such dread?

Medicare can be confusing, but we’ve got you. Let’s get smarter about the ABCs (and D).

 

Breaking it Down

Topping Medicare’s alphabet are Parts A and B,

known as “Traditional” or “Original” Medicare. Most people, when they become eligible for Medicare, sign up for Parts A and B at the same time.

 

Part A helps cover the “room and board” of hospital stays, skilled nursing, hospice, and some home health care.

 

Part A is free for people who paid (or their spouse paid) Medicare taxes while working at least 10 years. However, you will pay a deductible for any inpatient hospital stays per benefit period ($1,736. In 2026).

 

Part B helps cover doctor visits, outpatient care, preventive services, and medical equipment.

 

The premium in 2026 is $202.90 per month, with an annual deductible of $283, and 20% coinsurance for most doctor and outpatient services. Medicare pays 80% after deductibles are met.

 

Part C aka “Medicare Advantage Prescription Drug Plan” includes Part A and B and more and does not fall under Traditional Medicare.

Additional benefits include:

 

• Vision, dental, and hearing benefits.
• Prescription Drug coverage (Medicare Part D). Over 96% of people who choose Part C include prescription drug coverage.
• Extra extras may include Gym memberships, Fit Bits, Wearable medical alert systems, transportation to doctor, hospital, pharmacy, and more.
• Allowances for groceries, utilities, assistive devices, and more.

 

Another option, the “Medicare Advantage Plan” (aka “MA”) is also available but not often chosen. Both options are offered and managed by private insurance companies. Medicare Advantage costs, networks, copays, and deductibles vary by plan. Many plans have a $0 monthly premium; however, you still need to pay the Part B premium.

 

Part D helps pay for prescription medications. It is offered by private insurance companies where premiums, deductibles, copays, and covered drugs (known as a “formulary”) differ by company.

 

Medigap supplements your 20% out-of-pocket responsibility after Medicare pays its 80% of covered services. Known as a Medicare Supplement Plan, Medigap is not part of Medicare, but those with Traditional Medicare (Parts A and B) may purchase it through a private insurance company.

Various plans are available under Medigap, Plan G being the most popular. Costs vary according to factors like age, state of residence, and gender.

 

Now that you know you know your Medicare ABCs, before choosing the best option for you, look beyond the premium and consider deductibles, copays, prescription costs, and provider network. A plan that looks inexpensive — if it doesn’t meet your unique needs — can actually cost you.

 

Julie VanDyke is a freelance writer committed to simplifying Medicare for all.