Medicare Basics: Parts A, B, C, and D

The big picture: two ways to arrange Medicare

The four parts are easier to hold onto once you see the structure they form. Parts A and B are the federal foundation — hospital and medical insurance, together called Original Medicare. From there, most people arrange their coverage down one of two paths.

Path one: Original Medicare, supplemented. Keep Parts A and B as-is, generally add a stand-alone Part D plan for prescriptions, and often add a Medicare Supplement (Medigap) policy to help with Original Medicare’s cost-sharing.

Path two: Medicare Advantage. Receive the Part A and B benefits through a Part C private plan — most plans include Part D prescription drug coverage, although coverage varies by plan, and plans may include additional benefits — generally in exchange for using a plan network.

Neither path is universally better. The rest of this guide walks through each part, then the enrollment windows that determine when the choices get made.

Part A: hospital insurance

Part A generally covers inpatient hospital care, skilled nursing facility care following a qualifying hospital stay, hospice care, and some home health care — the institutional side of medicine.

Most people pay no monthly Part A premium, because premium-free Part A is generally available to those with a sufficient history of Medicare-covered employment — their own or, in some cases, a spouse’s. People without enough work history may be able to buy Part A for a monthly premium. Premium-free does not mean cost-free when care is used: Part A carries its own deductible and coinsurance structure, with amounts set annually, and how they apply depends on the type and length of care.

Part B: medical insurance

Part B generally covers the outpatient side: doctor visits, outpatient care, many preventive services, lab work, and durable medical equipment.

Part B carries a monthly premium, set annually, and higher-income beneficiaries may pay an income-related surcharge known as IRMAA. On the cost-sharing side, after an annual deductible — also set annually — Original Medicare generally pays 80% of the Medicare-approved amount for most covered Part B services, leaving 20% coinsurance, and Original Medicare has no annual out-of-pocket maximum. That last fact is the single biggest reason the supplement conversation exists, and it is worth sitting with before choosing a path.

Part C: Medicare Advantage

Part C — Medicare Advantage — is not a separate benefit package on top of Medicare; it is an alternative way to receive the Part A and B benefits, through a private plan approved by Medicare. Key features, which vary plan by plan:

• Bundling. Most Medicare Advantage plans include Part D drug coverage, and many may include additional benefits — such as dental, vision, or hearing allowances — that vary by plan and are described in the plan documents.
• Networks. Plans generally use provider networks — commonly HMO or PPO designs — and how out-of-network care is treated depends on the plan type.
• An out-of-pocket maximum. Unlike Original Medicare, Medicare Advantage plans generally include an annual out-of-pocket maximum for covered Part A and B services, with the limit varying by plan.
• Continued Part B premium. Enrollees generally continue paying the Part B premium, plus any plan premium.

Costs, networks, drug lists, and benefits vary by plan and county, and they can change each year — which is why the annual review habit matters as much in Medicare as anywhere.

Part D: prescription drug coverage

Original Medicare generally does not cover outpatient prescription drugs. Part D fills that gap through private plans: a stand-alone prescription drug plan alongside Original Medicare, or drug coverage built into most Medicare Advantage plans. Our Florida Part D page covers the plan side in more depth.

Part D plans run on formularies — each plan’s list of covered drugs, organized into tiers that help determine cost-sharing — along with pharmacy networks and requirements such as prior authorization. Checking your specific medications against a specific plan’s current formulary is the core Part D homework, every year.

One timing rule deserves its own sentence: going without Medicare drug coverage or other creditable prescription drug coverage for 63 consecutive days or more after the Initial Enrollment Period may result in a Part D late-enrollment penalty if the person later enrolls. The penalty is generally added to the monthly Part D premium for as long as the person has Medicare drug coverage. Higher-income beneficiaries may also pay an income-related amount on Part D.

Where Medicare Supplement (Medigap) fits

Medicare Supplement policies — Medigap — are private policies that work alongside Original Medicare, helping pay its cost-sharing: deductibles, coinsurance, and the exposure created by Original Medicare’s lack of an out-of-pocket maximum.

Three orientation points. Medigap plans are standardized by letter, so a given lettered plan’s benefits are generally the same across insurers, while premiums vary. Medigap generally cannot be combined with Medicare Advantage — it is a Path One tool. And timing matters: under federal law, the six-month Medigap Open Enrollment Period generally begins the first month a person is both age 65 or older and enrolled in Medicare Part B. During this period, the person can generally purchase any Medigap policy sold to them in the state without being denied or charged more because of health conditions. After this period, medical underwriting may apply unless the person has a guaranteed-issue right or another applicable protection. Medigap policies generally do not include drug coverage, which is why Path One usually pairs a Medigap policy with a stand-alone Part D plan.

When you enroll — and why timing matters

Most people first enroll during their Initial Enrollment Period — a seven-month window around the 65th birthday — and some people already receiving Social Security benefits are enrolled in Parts A and B automatically. People still working past 65 with qualifying employer coverage may be able to delay some enrollment and use a Special Enrollment Period later; the rules are specific, and how employer coverage coordinates with Medicare is worth confirming for your situation before deciding.

After that, the calendar takes over. The Annual Enrollment Period — October 15 to December 7 each year — generally allows changes to Medicare Advantage and Part D coverage for the following year, and a separate Medicare Advantage Open Enrollment Period early in the year generally allows certain changes for those already in a Medicare Advantage plan.

The reason timing gets its own section: late enrollment penalties may apply to Part B and Part D for those who go without qualifying coverage, and Medigap’s protected windows do not repeat on demand. The decisions cluster around 65 — and they reward being made deliberately rather than by default.

Medicare in Florida

The four parts are federal, but the plan landscape is local. Medicare Advantage and Part D plan availability, premiums, networks, formularies, and benefits vary by county, and Florida’s counties differ meaningfully — the options in Seminole County are not the options in Miami-Dade. Medigap premiums also vary by insurer and other factors within Florida’s rules.

Our Florida Medicare page covers the landscape statewide, with dedicated pages for Medicare Advantage, Medicare Supplement, and Part D drug plans in Florida.

When to call a licensed Florida agent

Medicare’s parts are learnable in an afternoon; the plan-level choices — this network, this formulary, this county, this year — are where help earns its keep.

A licensed agent can help explain how the parts fit your situation, review the Medicare Advantage, Medicare Supplement, and Part D options available in your county, help review the plan’s current provider directory and drug formulary for your doctors and medications, and walk through what the plan documents say. Provider participation and formulary coverage can change. Consumers should confirm current participation and coverage directly with the provider, pharmacy, and plan. Medicare and the plans make the official eligibility and coverage determinations — an agent explains coverage; an agent does not determine it — and no agent can guarantee costs, benefits, or outcomes. Insurance Advisors of Florida does not charge consumers an additional fee for this assistance. We are a local Florida agency — you can speak with a licensed Florida agent from our Lake Mary-based team. Insurance Advisors of Florida is located in Lake Mary and helps clients throughout Florida.

People also ask about Medicare basics

Am I enrolled in Medicare automatically at 65?

Some people are — generally those already receiving Social Security benefits are enrolled in Parts A and B automatically, with the option to decline Part B. Others need to actively enroll during their Initial Enrollment Period. Which situation applies to you is worth confirming ahead of your 65th birthday rather than assuming.

I’m still working at 65. Do I have to enroll?

Not always — people with qualifying employer coverage may be able to delay some enrollment without penalty and use a Special Enrollment Period after that coverage ends. The rules depend on factors such as employer size and how the coverage coordinates with Medicare, and getting them wrong can mean penalties or gaps, so this situation in particular rewards checking before deciding.

Does Medicare cover dental, vision, and hearing?

Original Medicare generally does not cover routine dental, vision, or hearing care. Many Medicare Advantage plans may include allowances or benefits in these areas, varying by plan and described in the plan documents, and separate stand-alone dental and vision policies also exist. What a specific plan includes is a plan-documents question, not a Medicare-wide one.

What is IRMAA?

IRMAA — the income-related monthly adjustment amount — is a surcharge that higher-income beneficiaries may pay on top of the standard Part B and Part D premiums, based on income reported to the IRS from a prior year. The thresholds and amounts are set annually, and an appeal process exists for certain life-changing events that reduce income.

Do Medicare Advantage plans limit which doctors I can see?

Generally, Medicare Advantage plans use provider networks — commonly HMO or PPO designs — and how out-of-network care is covered depends on the plan type and documents. Verifying your specific doctors against a specific plan’s current directory before enrolling is the same essential habit it is everywhere else in health insurance.

Medicare rules, premiums, deductibles, penalties, plan designs, networks, formularies, and plan availability vary by situation, county, and year, and can change. Insurance Advisors of Florida cannot guarantee eligibility, costs, coverage, or the outcome of any Medicare or plan determination. This article is intended for educational purposes and is not legal, tax, or medical advice. We do not offer every plan available in your area. Currently we represent 11 organizations which offer 250 products in all areas. Please contact Medicare.gov, 1-800-MEDICARE, or your State Health Insurance Program (SHIP) to get information on all your options.