Medicare 101
[posted June 5, 2026]
What is Medicare?
1
Medicare is a federal health insurance program for U.S. citizens and legal residents who are age 65 or older. Some individuals under 65 may qualify earlier due to certain disabilities, End-Stage Renal Disease (ESRD), or ALS (Lou Gehrig’s disease).
Medicare was designed to help cover hospital and medical expenses, but it doesn’t cover everything.
What is Original Medicare? (Part A and Part B)
2
Original Medicare consists of two parts:
Part A (Hospital Insurance) helps cover inpatient hospital stays, skilled nursing facilities, and some home health care. Most people do not pay a monthly premium for Part A if they’ve worked and paid Medicare taxes for at least 10 years. In 2026, the Part A deductible is $1,736 per benefit period.
Part B (Medical Insurance)helps cover doctor visits, outpatient care, preventive services, and medically necessary services. Most beneficiaries pay a monthly premium for Part B. In 2026, the standard premium is $202.90 per month, though higher-income individuals may pay more. The annual Part B deductible is $283, and after that, Medicare generally pays 80% while you pay 20%.
What doesn’t Original Medicare cover?
3
Original Medicare typically covers about 80% of approved medical costs. You are responsible for:
deductibles
20% coinsurance
no cap on out-of-pocket costs
100% of most prescription drug costs
Original Medicare doesn’t include routine prescription drug coverage, dental, vision, or hearing benefits. Because there is no out-of-pocket maximum, your financial exposure can be unpredictable without additional coverage.
When do you enroll in Medicare?
4
Your Initial Enrollment Period (IEP) lasts seven months: the three months before your 65th birthday month, your birthday month, and the three months after.
If you’re already receiving Social Security benefits at least four months before turning 65, you are typically enrolled automatically in Part A and Part B. If not, you’ll need to actively enroll.
Failing to enroll when first eligible — and not having creditable coverage — may result in lifetime penalties.
What is Medicare Advantage? (Part C)
5
Medicare Advantage, also known as Part C, is an alternative way to receive your Medicare benefits through a private insurance company approved by Medicare.
These plans combine:
Part A (Hospital)
Part B (Medical)
usually Part D (Prescription Drug Coverage)
Most Medicare Advantage plans include additional benefits that Original Medicare doesn’t cover, such as dental, vision, hearing, and wellness programs.
However, these plans typically use provider networks, which means you’ll usually need to use doctors and hospitals within the plan’s network to receive the lowest costs. You must continue paying your Part B premium and may also pay a separate plan premium depending on the plan you choose.
What is Part D (Prescription Drug Coverage)?
6
Part D helps lower the cost of prescription medications. It can be purchased as:
a stand-alone plan alongside Original Medicare
included within a Medicare Advantage plan
While Part D is optional, delaying enrollment without creditable prescription coverage may result in a penalty. Drug plans have different cost stages throughout the year, meaning your share of the cost may change depending on how much you spend on medications.
What is a Medicare Supplement (Medigap) plan?
7
Medicare Supplement plans, also known as Medigap plans, work alongside Original Medicare to help cover costs such as deductibles and the 20% coinsurance.
There are 10 standardized plans (A–N). Each plan offers standardized benefits, though pricing varies by carrier and location.
Medigap plans:
require you to have Part A and Part B
do not include prescription drug coverage, so Part D must be purchased separately
have no provider networks, so you can see any doctor that accepts Medicare
do not include dental, vision, or hearing benefits
are guaranteed renewable as long as premiums are paid
You can't have both a Medicare Advantage plan and a Medicare Supplement plan at the same time.
When can you enroll in a Medicare Supplement?
8
You have a one-time Medigap Open Enrollment Period that begins the first month you are both 65 or older and enrolled in Part B. This period lasts six months.
During this time:
you can’t be denied coverage due to health conditions
you can’t be charged more because of pre-existing conditions
After this period, you may be subject to medical underwriting unless you qualify for special guaranteed issue rights.
Idaho Birthday Rule
9
In Idaho, Medicare Supplement members can switch to a comparable or lesser plan once per year during a 63-day window starting on their birthday, without medical underwriting. This gives members flexibility that isn’t available in many other states.
Medicare Advantage replaces Original Medicare with an all-in-one plan that often includes extra benefits, but uses provider networks and has structured copays.
Medicare Supplement works alongside Original Medicare, helps reduce out-of-pocket costs, and offers greater provider flexibility, but doesn’t include extra benefits like dental or vision.
The right choice depends on your health, budget, prescription needs, travel habits, and long-term risk tolerance.
Medicare Advantage vs. Medicare Supplement: what’s the difference?
10
Why planning matters
Medicare decisions affect your healthcare access and financial protection for years to come. Understanding enrollment timelines, penalties, coverage differences, and out-of-pocket exposure is important.
The best Medicare strategy isn’t one-size-fits-all. It should align with your health needs, financial comfort level, and future plans.
