Medicare has four main parts, and each one covers different things

Medicare Part A covers hospital stays, skilled nursing care after a hospital stay, hospice, and some home health services. Medicare Part B covers doctor visits, outpatient care, medical equipment, and preventive services. Medicare Part D covers prescription drugs. Medigap (also called Supplemental Insurance) covers some of the costs that Parts A and B do not — like copayments, coinsurance, and deductibles.

Most people turn 65 and enroll in Part A and Part B automatically. Part D is separate and optional, but there is a penalty if you wait to enroll and do not have other drug coverage. Medigap is also optional, but it can save you money if you use a lot of medical services.

The coverage each part offers is the same no matter which insurance company sells it to you. What changes is the monthly premium, the deductible, and which doctors and pharmacies are in the network.

Key Takeaways

  • Part A covers hospital and skilled nursing stays; Part B covers doctor visits and outpatient care; Part D covers prescription drugs.
  • Medigap policies cover some of the out-of-pocket costs that Original Medicare does not, such as copayments and deductibles.
  • You enroll in Part A and Part B at 65, but Part D and Medigap are optional — though waiting to enroll in Part D can result in a permanent penalty.
  • The benefits are the same across all insurance companies; the differences are in premiums, deductibles, and which providers are in-network.
  • Some people choose Medicare Advantage (Part C) instead of Original Medicare, which bundles Parts A, B, and usually D into one plan with different coverage rules.

What Medicare Part A covers

Part A pays for inpatient hospital care — that means you are admitted to the hospital and stay overnight. It covers the hospital room, meals, nursing care, and most tests and procedures done while you are there. It also covers blood transfusions and anesthesia.

Part A also covers skilled nursing care after a hospital stay. If you need physical therapy or wound care after surgery or an illness, and a doctor says you need skilled care, Part A will pay for up to 100 days in a skilled nursing facility. You pay nothing for the first 20 days if you have been in the hospital for at least three days. Days 21 through 100 require a copayment per day.

Part A covers hospice care if you have a terminal illness and your doctor says you have six months or less to live. It pays for pain management, symptom relief, and comfort care, either at home or in a facility. Part A also covers some home health services — nursing visits, physical therapy, and medical equipment — if you are homebound and a doctor orders the care.

What Medicare Part B covers

Part B covers doctor visits, whether in an office, clinic, or hospital outpatient department. It pays for the doctor's time and the basic tests and procedures done during the visit. It covers preventive services at no cost to you — annual wellness visits, cancer screenings, vaccinations, and cardiovascular and diabetes screenings.

Part B also covers durable medical equipment — wheelchairs, walkers, oxygen equipment, and diabetic supplies. It pays 80 percent of the approved amount after you meet your deductible; you pay 20 percent. It covers mental health services, including therapy and psychiatric visits, at the same 80/20 split.

Part B covers outpatient surgery, emergency room visits, and urgent care. It does not cover routine dental, vision, or hearing care — those require separate coverage. Part B also does not cover long-term custodial care in a nursing home, such as help with bathing and dressing when skilled nursing is not needed.

What Medicare Part D covers

Part D is prescription drug coverage. You choose a plan from a list of insurance companies, and each plan has a different formulary — a list of drugs it covers. Most plans cover brand-name and generic drugs, but the copayment or coinsurance varies by drug and by plan.

Part D has a coverage gap, sometimes called the "donut hole." Once you and your plan have spent a certain amount on drugs in a year, you enter the gap and pay more out of pocket until you reach a spending threshold. After that, catastrophic coverage kicks in and you pay a small copayment. The exact amounts change each year.

You can enroll in Part D when you turn 65, during the annual enrollment period in October and November, or if you lose other drug coverage. If you do not enroll when you are first may be able to access and do not have other creditable drug coverage, you will pay a permanent penalty on top of your premium for as long as you have Part D.

What Medigap (Supplemental Insurance) covers

Medigap policies are sold by private insurance companies and are designed to cover costs that Original Medicare leaves with you — copayments, coinsurance, and deductibles. There are ten standardized Medigap plans, labeled A through N. Each plan covers a different combination of out-of-pocket costs.

For example, Plan G covers your Part B deductible, Part B coinsurance, and copayments for hospital stays and skilled nursing care. Plan N covers similar things but not the Part B deductible. Plan A is the most basic and covers fewer costs. The benefits are the same no matter which insurance company sells the plan — Plan G from one company covers exactly what Plan G from another company covers.

Medigap does not cover prescription drugs, dental, vision, or hearing care. If you want drug coverage, you still need to enroll in Part D. Medigap also does not cover long-term care or custodial nursing home stays.

What is not covered by any part of Medicare

Medicare does not cover routine dental care, dentures, dental implants, or orthodontia. It does not cover routine eye exams, eyeglasses, or contact lenses. It does not cover hearing aids or routine hearing exams, though it does cover some diagnostic hearing tests ordered by a doctor.

Medicare does not pay for long-term custodial care — help with bathing, dressing, and daily living when skilled nursing is not needed. This is true whether you are at home, in an assisted living facility, or in a nursing home. Many people buy long-term care insurance or Medicaid to cover these costs, though Medicaid rules vary by state.

Medicare also does not cover cosmetic surgery, weight loss surgery (unless medically necessary), or most fertility treatments. It does not cover routine foot care, though it does cover foot care for people with diabetes. It does not cover most over-the-counter drugs or vitamins.

How to find out what your specific plan covers

If you have Original Medicare (Part A and Part B), your coverage is the same nationwide. You can call Medicare at 1-800-MEDICARE or visit Medicare.gov to confirm what is covered for a specific service or drug.

If you have a Medigap plan, your insurance company's website or member handbook will list exactly which copayments and deductibles the plan covers. If you have Part D, your plan's formulary is on your insurance company's website — you can search for a specific drug to see what tier it is on and what you will pay.

If you have Medicare Advantage (Part C), coverage rules are different from Original Medicare. Your plan's member handbook or website will show what is covered, which doctors and hospitals are in-network, and what your copayments are. Call your plan's customer service number if you are unsure whether a specific service is covered.

Frequently Asked Questions

Does Medicare cover eye exams and glasses?

Medicare does not cover routine eye exams or eyeglasses. It does cover eye exams and treatment for certain eye diseases, such as glaucoma and macular degeneration, when ordered by a doctor. You can buy a separate vision plan or pay out of pocket for routine care.

Does Medicare cover dental work?

Original Medicare does not cover routine dental care, cleanings, fillings, or dentures. Some Medicare Advantage plans include dental coverage, but it is usually limited. You can buy a separate dental plan or pay out of pocket.

What happens if I do not enroll in Part D when I turn 65?

If you do not have other drug coverage and do not enroll in Part D at 65, you will pay a permanent penalty added to your premium for as long as you have Part D. The penalty is about 1 percent of the national average Part D premium for each month you were not enrolled. It is better to enroll even if you do not take many drugs.

Does Medicare cover hearing aids?

Medicare does not cover hearing aids or routine hearing exams. It does cover diagnostic hearing tests ordered by a doctor as part of treatment for a medical condition. You can buy hearing aids out of pocket or through a separate plan.

Does Medigap cover prescription drugs?

No. Medigap covers out-of-pocket costs like copayments and deductibles, but not drugs. If you want drug coverage, you must enroll in Part D separately. You can have both Medigap and Part D at the same time.