Medicare 101: Plain-English Basics
Medicare can feel overwhelming with all its parts, plans, and deadlines. Let us break it down into simple terms so you can make informed decisions about your healthcare coverage.
The Four Parts of Medicare
Understanding what each part covers is the first step to choosing the right plan.
What It Covers
- •Inpatient hospital stays
- •Skilled nursing facility care
- •Hospice care
- •Some home healthcare services
Cost
Usually premium-free if you or your spouse worked and paid Medicare taxes for 10+ years
Out-of-Pocket
Deductibles and coinsurance apply for hospital stays
Medicare Supplement (Medigap)
Medigap policies help cover the "gaps" in Original Medicare — deductibles, copays, and coinsurance. These plans provide predictable costs but require a monthly premium in addition to Part B.
Standardized plans (A, B, C, D, F, G, K, L, M, N)
Works with any doctor who accepts Medicare
Best time to enroll: during your Medigap Open Enrollment
Medicare Coverage Gaps - What You Need to Know
Original Medicare (Parts A & B) covers a lot, but not everything. Understanding these gaps helps you decide if you need supplemental coverage.
Medicare Part A Coverage Gaps
Hospital deductible per benefit period
You pay a deductible before Part A coverage begins each benefit period — the amount is set annually by Medicare
Hospital coinsurance (days 61–90)
After 60 days in the hospital, you pay a daily coinsurance amount set by Medicare each year
Skilled nursing coinsurance (days 21–100)
Part A fully covers the first 20 days of skilled nursing care; daily coinsurance applies through day 100
No coverage beyond 100 days
Part A stops covering skilled nursing after 100 days
Blood transfusions (first 3 pints)
You pay for the first 3 pints of blood each calendar year
Medicare Part B Coverage Gaps
Annual deductible, then 20% coinsurance
After meeting your annual Part B deductible (set by Medicare each year), you pay 20% of Medicare-approved costs
No annual maximum out-of-pocket limit
Unlike Medicare Advantage, Original Medicare has no cap on your costs
Outpatient mental health copays
You pay 20% coinsurance for outpatient mental health services
Prescription drugs NOT covered
You need separate Part D coverage for most prescription medications
Preventive services may have copays
Some preventive screenings are free, but certain tests require cost-sharing
Why Medigap (Medicare Supplement) Exists
Medigap insurance fills these "gaps" by covering the deductibles, copays, and coinsurance that Original Medicare doesn't pay. This can save thousands of dollars annually if you have frequent doctor visits or medical needs.
Example: With Original Medicare alone, you're responsible for 20% of all approved costs with no annual cap. With Medigap Plan G, you'd typically only pay the annual Part B deductible — Medicare and Medigap cover the rest.
Why Medicare Advantage (Part C) Exists
Medicare Advantage combines Parts A, B, and usually D into a private plan. These plans often have lower copays for routine care but require you to use in-network providers. Many include extra benefits not covered by Original Medicare.
Trade-off: Medicare Advantage plans typically have lower premiums but network restrictions. Original Medicare + Medigap has higher premiums but allows you to see any doctor accepting Medicare nationwide.
Important Enrollment Periods
Missing these windows can result in penalties and coverage gaps.
Initial Enrollment Period (IEP)
7-month window around your 65th birthday (3 months before, your birthday month, and 3 months after). Miss it and you may face lifetime penalties!
⚠️ This is critical — don't miss it!
Annual Enrollment Period (AEP)
October 15 - December 7 each year. Change your Medicare Advantage or Part D plan for coverage starting January 1.
Medicare Advantage Open Enrollment
January 1 - March 31. Switch from one Medicare Advantage plan to another, or switch back to Original Medicare.
Special Enrollment Periods (SEP)
Qualifying life events (losing employer coverage, moving, etc.) may allow you to enroll outside normal periods.