Medicare Basics: Understanding the Different Parts (A, B, C, and D)

Let's face it—Medicare can be daunting and a little scary. With different parts and options to consider, it can be hard to understand how each component works together to provide

comprehensive coverage. The intent of this blog is to provide you with an overview of Medicare Basics, explaining the different parts—A, B, C, and D—and how they interact to support your healthcare needs. But first things first.

What Is Medicare?

Medicare is a government health insurance program primarily designed for people aged 65 and older, though certain younger individuals with disabilities or specific medical conditions, like End-Stage Renal Disease, also qualify. Medicare is divided into four parts: A, B, C, and D, each covering different aspects of healthcare services. Knowing the Medicare Basics will help you decide which parts you need and how they fit into your healthcare plan.

Breaking Down The Parts

Part A: Hospital Insurance

Part A covers inpatient hospital stays, skilled nursing facility care, hospice care, as well as some home health care. This Part is often referred to as "hospital insurance."

Most individuals do not have to pay a premium for Part A if they or their spouse have paid Medicare taxes for at least ten years (40 quarters). However, deductibles and coinsurance apply for hospital stays and other services.

Example: If you’re admitted to the hospital for surgery, Part A will cover your room, meals, nursing services, and any other necessary care during your stay. You’ll be responsible for any deductibles or co-payments that apply.

Part B: Medical Insurance

Part B helps to cover outpatient services such as doctor visits, preventive services, durable medical equipment, mental health services, and some home health care. This Part is often referred to as "medical insurance."

Part B does require a monthly paid premium. Most people pay the standard premium amount, but those with higher incomes may pay more. After meeting an annual deductible, Part B covers 80% of approved services, while the individual pays the remaining 20%.

Example: If you visit your doctor for a routine check-up or need an X-ray, Part B will help cover the cost of these outpatient services. You’ll pay a monthly premium, and after meeting your deductible, Part B will handle the majority of the cost.

Part C: Medicare Advantage Plans

Part C, which is also known as Medicare Advantage, offers an alternative to Original Medicare (Parts A and B) by providing all-in-one plans through private insurance companies. These plans often include additional benefits, such as vision, dental, and hearing coverage, and may incorporate prescription drug coverage (Part D).

Medicare Advantage plans are offered by private insurers and must cover at least what Original Medicare covers, but many plans offer additional services and benefits. You’ll still pay your Part B premium, but some Medicare Advantage plans may have lower out-of-pocket costs or offer extra services.

Example: A Medicare Advantage plan might offer more comprehensive coverage, such as dental exams, eyeglasses, or fitness programs, in addition to hospital and medical insurance. You'll receive all of your coverage through one plan instead of managing multiple parts.

Part D: Prescription Drug Coverage

Part D is designed to help you cover the cost of prescription drugs. This Part is optional and can be added to Original Medicare (Parts A and B). It can also be included in some Medicare Advantage plans (Part C).

Part D plans are not goverment plans and are offered by private insurers. The cost depends on the specific plan and the drugs covered. Each plan has a formulary, or list of covered drugs, and the costs may vary, depending on type of drug, and if the drug is a brand name or can be prescribed as a generic. Like Part B, you'll pay a monthly premium and possibly a deductible.

Example: If you need medication for managing a chronic condition like high blood pressure, Part D will help cover the cost of your prescriptions, either fully or partially, depending on the plan’s coverage.

How Do the Parts Work Together?

When you understand how the different parts of Medicare work together you can get the most out of your coverage. For most beneficiaries, Medicare Basics starts with Parts A and B, which cover hospital and medical services. Part D can be added for prescription drug coverage, or you may opt for Part C (Medicare Advantage) for an all-in-one plan that often includes Part D.

For example, if you are enrolled in Original Medicare (Parts A and B) and need prescription coverage, you can choose to sign up for Part D to handle your medication needs. Alternatively, you could switch to a Medicare Advantage plan (Part C), which often includes prescription drug coverage as well as additional benefits like dental or vision.

Final Thoughts on Medicare Basics

Medicare offers robust healthcare coverage through its various parts, but it’s important to understand how each one works to create the right plan for your needs. Parts A, B, C, and D offer a range of options for hospital care, outpatient services, prescription drug coverage, and more. By familiarizing yourself with the differences between each Part, you can ensure you have the right combination of coverage for your healthcare needs, whether that means sticking with Original Medicare or exploring a Medicare Advantage plan.

If you need support with Medicare and other public benefits, the team at Johnson McGinnis Elder Care Law & Estate Planning has the knowledge and experience to help guide you through the process. To find out more about how Medicaid & Insurance Support services from Johnson McGinnis Elder Care Law can benefit you and your loved ones, contact Johnson McGinnis to schedule your free consultation.