Free Guide to Medicare Benefits for Seniors

What Medicare Actually Covers and What It Doesn't

Medicare is a federal health insurance program for people age 65 and older, and it comes with specific boundaries about what medical services and supplies it pays for. Understanding these boundaries matters because many seniors assume Medicare covers everything related to health care, and that's simply not true. Out-of-pocket costs can add up fast when you encounter services or items that fall outside Medicare's coverage.

How to Pay Your Vexus Internet Bill Online →

Medicare Part A, the hospital insurance portion, covers inpatient hospital stays, skilled nursing facility care after a hospital stay, some home health services, and hospice care. However, it does not cover custodial care—assistance with daily activities like bathing or dressing when that's the only care needed. Part B, the medical insurance portion, covers doctor visits, outpatient services, diagnostic tests, and some preventive screenings. But Part B does not cover routine dental work, hearing aids, eyeglasses (with limited exceptions), or most long-term care services.

Consider a real scenario: A 67-year-old woman needs a knee replacement. Medicare Part B will cover the surgery and surgeon fees. However, if she later needs physical therapy at home three times a week for two months, Medicare Part A home health benefits might cover some of those visits, but only if she meets specific conditions—like being homebound and having a doctor order the care. If she wants to see a physical therapist at an outpatient clinic instead, Part B may cover it, but she'll typically pay a copayment.

Dental care is one of the biggest coverage gaps. Medicare does not pay for cleanings, fillings, crowns, extractions, or dentures. Annual dental care can cost $500 to $2,000 out-of-pocket for many seniors. Similarly, Medicare does not cover routine eye exams, bifocals, or contact lenses, though it does cover one pair of eyeglasses after cataract surgery.

Prescription drugs fall under Part D, a separate program, and coverage varies depending on which plan you choose. Some drugs are covered; others are not. Some require prior authorization from the insurance company before the pharmacy will fill them.

Practical takeaway: Create a checklist of medical services and items you regularly use or anticipate needing. Cross-reference each one against what Medicare Part A and Part B cover. This exercise reveals your true out-of-pocket exposure and helps you plan whether supplemental coverage makes sense for your situation.

The Four Parts of Medicare and How Each One Works

Medicare consists of four separate parts, and each one addresses different types of care. Many seniors become confused because these parts work independently, have different costs, different rules, and sometimes overlap. The way you combine these parts significantly affects your total health care expenses and your access to providers.

Learn How to Pay Your Aqua Ohio Water Bill →

Part A is hospital insurance. It covers inpatient hospital care, including room, meals, and standard nursing care. The 2024 Part A deductible is $1,632 per benefit period. Once you pay this deductible, Medicare covers the full cost of your hospital stay for the first 60 days. Days 61-90 require a copayment of $408 per day. If you need to stay longer than 90 days, you enter "lifetime reserve days," which are a limited pool of additional covered days that you only get once in your lifetime. After you exhaust those, you pay the full cost yourself. Part A also covers up to 100 days in a skilled nursing facility after a hospital stay, though you'll pay copayments starting on day 21.

Part B is medical insurance. It covers outpatient services: doctor visits, lab tests, imaging, ambulance services, and durable medical equipment like wheelchairs or oxygen. Part B has a yearly deductible (currently $240 in 2024) and after you meet that deductible, you typically pay 20% of the approved amount for each service while Medicare pays 80%. Part B requires a monthly premium, which in 2024 ranges from $164.90 to $560.50 depending on your income. Higher-income earners pay higher premiums under Medicare's Income-Related Monthly Adjustment Amount (IRMAA). This is a critical detail many seniors overlook: your Part B premium is not fixed—it changes if your income increases.

Part D is prescription drug coverage. This is not automatic. You must choose a Part D plan during your Initial Enrollment Period or when you first become a Medicare member. Part D coverage varies dramatically based on which plan you select. Some medications are tier 1 (lowest copay), others are tier 3 or 4 (much higher copay). Many plans have a coverage gap—sometimes called the "donut hole"—where after you and your insurance pay a certain amount, you temporarily pay more out-of-pocket before catastrophic coverage kicks in. In 2024, the coverage gap begins after you and your plan have spent $5,850 combined on covered drugs.

Part C, also called Medicare Advantage, is not a separate part of Original Medicare. Instead, it's an alternative way to receive Parts A and B benefits through a private insurance company. Part C plans often include Part D prescription coverage and may add dental, vision, or hearing benefits that Original Medicare doesn't provide. However, Part C plans typically have networks—you must use doctors and hospitals within the plan's network, or pay higher out-of-pocket costs or nothing is covered at all. Some Part C plans require prior authorization before you can see a specialist or get certain procedures.

Practical takeaway: Write down which parts you currently have. Then list your anticipated health needs for the next year (preventive visits, ongoing medications, specialist appointments). Match each need to the appropriate part to see where gaps exist and where you're covered.

Supplemental Insurance: When and Why Seniors Add It

Many seniors quickly discover that Original Medicare (Part A plus Part B) leaves them responsible for significant out-of-pocket costs. This is where supplemental insurance, also called Medigap, enters the picture. These are policies sold by private insurance companies that cover some of the costs that Medicare doesn't pay—copayments, coinsurance, and deductibles. Roughly one-third of Medicare beneficiaries have Medigap coverage through either a current or former employer, or purchase it individually.

Remove a Payment Card From Your Lyft Account Guide →

The federal government has standardized Medigap plans into ten different options, labeled A through N (Plan M and Plan N were added more recently). Each plan covers a different combination of out-of-pocket costs. Plan A is the most basic and least expensive but covers fewer gaps. Plan G is among the most comprehensive and most expensive. For example, Plan A covers Part A hospital coinsurance and copayments and Part B coinsurance, but nothing else. Plan G covers nearly everything Original Medicare doesn't pay for except the Part B deductible. Monthly premiums for these plans vary significantly by insurance company, your location, and your age. A 65-year-old in Florida might pay $120 per month for Plan A from one company and $165 from another.

There's an important timing consideration with Medigap that many new beneficiaries miss. If you enroll in Part B when you first become a Medicare member at age 65, you have a six-month period called the "Medigap Open Enrollment Period" during which insurance companies cannot deny you coverage or charge higher premiums based on health conditions. If you wait too long to buy Medigap, you may pay significantly higher premiums or encounter health-based restrictions. Some people delay purchasing Medigap thinking they don't need it yet, then face substantial premium increases when they finally apply.

Medigap is different from Medicare Advantage (Part C). You cannot have both Medigap and Medicare Advantage simultaneously. If you have Original Medicare and want to add supplemental coverage, you choose Medigap. If you choose Medicare Advantage as your coverage method, supplemental insurance is unnecessary because the coverage works differently.

The financial calculation for whether Medigap makes sense depends on your health care usage. If you see doctors frequently, need specialists, or take multiple prescription medications, Medigap's predictable copayments might save you money compared to paying 20% coinsurance on many services. If you're healthy with minimal health care needs, paying Medigap premiums might not make financial sense. Reviewing your actual medical expenses from the past year helps with this decision.

Practical takeaway: Pull your medical and pharmacy records from the past 12 months. Calculate what you actually paid out-of-pocket under your current coverage. Then get quotes from at least three