Learning Center > What is Medicare?

What is Medicare?

Medicare is a health insurance program provided by the federal government. Medicare is provided for individuals who are 65 and older, as well as younger people with disabilities or end-stage renal disease.

Medicare includes several parts, each of which provides coverage for specific medical needs. Original Medicare includes Part A (hospital coverage), Part B (medical coverage), and Part D (prescription medication coverage). Medicare Part C is known as Medicare Advantage.

Who Qualifies for Medicare?

As we mentioned above, an individual who qualifies for Medicare if he or she is 65 or older. Younger individuals can qualify for Medicare if they are permanently disabled or diagnosed with end-stage renal disease.

What Is The Purpose Of Medicare?

Medicare is available to make health coverage accessible to older Americans age 65 and over, including those who are traditionally retired and no longer have access to employer-based health insurance.

Medicare also provides coverage to those under 65 with certain disabilities to cover their health needs and associated expenses. These Americans often cannot work and don’t have access to employer coverage or other health insurance.

Types of Medicare

Medicare is divided into several parts, labeled from A to D:

  • Medicare Part A is known as hospital insurance. It offers coverage for inpatient hospital care, lab tests, and surgery, as well as home health care and skilled nursing facilities. These services must be deemed medically necessary to be covered by Medicare. You may have to pay a deductible or coinsurance
  • Medicare Part B is used for medical visits to a doctor. Medicare covers medically necessary services and preventive services. Each Medicare participant pays a monthly premium for Medicare Part B and there may also be deductibles and coinsurance that apply, depending on the care you receive
  • Medicare Part C is known as Medicare Advantage. This isn’t part of Original Medicare but instead is an all-in-one replacement plan. Medicare Advantage plans include hospital coverage and doctor’s visits, along with prescription drug coverage. Many also offer additional benefits Original Medicare doesn’t cover, such as vision and dental care. However, you will often need to use medical professionals within the provider’s network. You’ll pay different copayments and deductibles with Medicare Advantage than with Original Medicare, which may allow you to save money. You may also have an additional monthly premium
  • Medicare Part D is prescription drug coverage. It helps you pay for both brand-name and generic drugs, depending on your needs. The drug plans for Medicare are offered by insurance companies and other approved private companies. If you choose Medicare Part D, you will have a separate Part D premium each month

Medicare FAQ

In addition to the different types of Medicare, qualified individuals, caregivers, and loved ones often have questions about Medicare coverage. Here are some additional Medicare FAQ and answers.

What Does Medicare Cover?

Medicare covers a wide variety of healthcare services. The specific coverage depends on the Medicare policy you choose. Services covered by Medicare include:

  • Ambulance services
  • Anesthesia
  • Artificial eyes & limbs
  • Bariatric surgery
  • Blood processing & handling
  • Cardiac rehabilitation programs
  • Cardiovascular disease screenings
  • Cervical & vaginal cancer screenings
  • Chemotherapy
  • Depression screenings
  • Diabetes prevention programs
  • Diagnostic tests (laboratory and non-lab)
  • Eye exams (routine)
  • Eyeglasses & contact lenses
  • Flu shots
  • Foot care
  • Hearing aids
  • Hepatitis B and HIV screenings
  • Inpatient hospital care
  • Kidney transplants
  • Lung cancer screenings
  • Mammograms
  • Mental health care (inpatient and outpatient)
  • Occupational therapy
  • Opioid use disorder treatment services
  • Organ transplants
  • Pain management
  • Prescription drugs (outpatient)
  • Preventive & screening services
  • Radiation therapy
  • Sexually transmitted infections screenings & counseling
  • Sleep studies
  • Surgery
  • Urgently needed care
  • X-rays
  • Yearly "wellness" visits

Do I Need Medicare if I Already Have Health Insurance?

Whether or not you need Medicare if you already have health insurance depends on your individual medical needs. You may need Medicare even if you already have other health insurance if your current plan doesn’t meet the minimum coverage requirements.

Most plans offered by employers meet these standards. So if you have insurance through your job, you probably don't need Medicare. However, by staying on an employer plan, you can delay enrolling in Part B without a penalty and avoid paying Part B premiums.

An important note: When you have Medicare plus additional insurance policies, each provider becomes a "payer." The policy that pays for your specific medical services first depends on the coordination of benefits rules for your plans.

In other words, the primary payer will pay what it owes on your medical bills first, then the provider will send the remaining amount to the secondary payer to pay the rest.

What is the Difference Between Medicare and Medicaid?

Medicare is a federal health insurance program for older Americans and those with disabilities regardless of income. Medicaid is a state-based health insurance program for lower-income Americans that need help paying for medical care.

To learn more about costs, eligibility, and coverage, visit this guide to Medicare vs. Medicaid.

Who Do You Call for Medicare Questions?

If you have additional questions about Medicare and what it covers, you can call 1-866-955-0898 (TTY 711) to speak with one of our licensed insurance agents.

Agents are available Monday - Friday from 8am - 9pm and Saturday - Sunday 10am - 5pm ET.

Where Can I Get Free Medicare Advice?

For information on Medicare coverage, open enrollment, the different types of Medicare, and more, visit our Medicare learning center. For specific Medicare questions, contact us to speak with a licensed insurance agent.

Learn More About Medicare

Medicare is a valuable way to cover your healthcare costs if you are older or disabled. To compare your options and find the right Medicare plan in your area, visit our Medicare plans page today!

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What you should read next

 a donut with a bite as a visual metaphor for the Medicare Donut Hole

If you choose to have Original Medicare with Medicare Part D added, you’ll receive prescription drug coverage through Medicare Part D. However, there can sometimes be a gap in the coverage of your prescriptions. This gap is known as the “donut hole,” and it’s a period of time where you pay out-of-pocket for your medications. However, you don’t pay the full amount, and once your out-of-pocket costs hit a specific level Medicare will resume coverage. What is the Medicare donut hole? This page will help you understand the donut hole and how to navigate it. How Does the Donut Hole Work in Medicare? The Medicare donut hole is a period of time where you’ve reached the limit of your Medicare Part D coverage, but haven’t hit the “catastrophic coverage” level where Medicare resumes assisting you with your prescription drug coverage. With Medicare Part D, the first portion of the year you’ll be paying toward your deductible. The deductible varies but can be up to $445 in 2021. Once you reach your deductible, your drug plan will kick in and you’ll pay your copayment or coinsurance for your medication. If the amount you and your plan pay toward prescription drugs reaches a certain level, you’ll enter the donut hole. Keep in mind that not everyone gets to the prescription donut hole — the gap was designed to encourage Medicare recipients to seek out lower-cost drugs and generics. The Medicare donut hole in 2021 starts at $4,130. When Does the Medicare Donut Hole End? The coverage gap ends when you reach the catastrophic coverage limit for the year. In 2021, this amount is $6,550. The good news is that the donut hole essentially closed in 2020, so that even when you hit the coverage gap, you won’t pay more than 25% of the cost of prescription drugs. However, around 95% of the cost will count toward moving you out of the hole. Do Medicare Advantage Plans Cover the Donut Hole? Medicare drug coverage — Part D — works the same in a Medicare Advantage plan as it does with a "Stand-alone” Part D plan. However, some Medicare Advantage plans offer more generous benefits during the donut hole than a stand-alone Part D plan does. Understanding your prescription drug coverage is essential so that you know if you’re likely to approach a coverage gap based on the price of your medication. If so, make sure you know what the costs will be during the donut hole period. Medicare Part D Plans Without the Donut Hole There are no Medicare Part D plans — including Medicare Advantage plans — without a coverage gap. However, some prescription plans have additional coverage options during the donut hole. For instance, your Medicare Advantage plan might include coverage for some generic medications even in the gap. Or, they may offer some drugs at a lower cost than 25%. It all depends on your plan and provider. The best way to avoid the donut hole is to work with your doctor to keep the cost of your medication low. If that’s not possible, the fact that you will pay no more than 25% of the full cost even in the coverage gap will help ease your mind. How Do I Get Out of the Medicare Donut Hole? If you’re in the Medicare Part D donut hole, the only way to get out is to spend enough to reach the catastrophic coverage threshold. The good news is that while you’re paying no more than 25% of the cost of the medication, close to 95% of the cost of the drugs is going toward your spending total. One way to manage the coverage gap “donut hole” is to work with your doctor to find effective low-cost and generic medications that will help you maintain your physical health. Here are some tips that can help: Use a generic or find a similar drug that has a generic Talk to your doctor about drug costs and whether specific prescriptions are really needed Shop around — different pharmacies offer different drug prices Compare Medicare plans each year to make sure you have affordable drug coverage Learn More About Medicare Costs and Plans Medicare costs can be confusing, especially when there is the possibility of a coverage gap in the middle of the year. Fortunately, even during the Medicare donut hole, you don’t have to pay more than 25% of a prescription drug price, and you may even pay less. If you’re interested in comparing Medicare plans to make sure your drug coverage meets your needs, talking to a licensed insurance agent can help. Learn more about your options and compare Medicare plans today!
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Medicare enrollment periods

Everyone can enroll in Medicare in the seven-month period around their 65th birthday through the Medicare Initial Enrollment Period (IEP). It starts three months before your birth month, includes your birth month, and ends three months afterward. If you don’t enroll in Medicare (either Medicare Part A or Part B) during your IEP, you can enroll enroll in either during the General Enrollment Period that occurs annual from January 1 through March 31 of each year. After you enroll in Medicare when can you change your Medicare coverage options? There are three main enrollment periods that allow you to make changes to your coverage. Everyone with Medicare can make changes during the annual enrollment period (AEP). If you have certain qualifying events happen in your life, you may also have a special enrollment period (SEP) to allow changes. And if you are enrolled in a Medicare Advantage (MA) plan, you will also have an opportunity to make changes during the MA open enrollment period (OEP) that happens at the beginning of the year. . This article will cover these enrollment periods in more detail so you know exactly when you can make changes to your Medicare plan. Special Enrollment Period SEP for those enrolled in Medicare Advantage or Prescription Drug Plans If you have special circumstances in your life, , you may qualify for a Medicare SEP to change your Medicare Advantage or Part D plan coverage. The special enrollment period options and length will be different for each circumstance. For example, you could qualify for an SEP if you: Retire from a job after age 65 Move Become eligible for Medicaid Have your Medicare plan terminated by the insurer Lose other medical or drug coverage To learn more about Medicare SEPs, check out our guide on special enrollment periods. Medicare Advantage Open Enrollment (MA OEP) vs. Annual Enrollment (AEP) Both Medicare annual enrollment period (AEP) and Medicare Advantage Open Enrollment period (MA OEP) happen each year. However, there are some important differences. This will help you understand Medicare AEP vs Medicare Advantage OEP. The Medicare annual enrollment period is between October 15th and December 7th of each year. During this time everyone with Medicare can join, switch, or drop any Medicare Advantage or Prescription Drug plan (“Part D). Your coverage will begin on January 1st, as long as you make your choice by December 7th. The Medicare Advantage open enrollment period applies only to those enrolled in Medicare Advantage plans. From January 1st to March 31st each year, you can switch to a different Medicare Advantage plan, or switch from Medicare Advantage to Original Medicare and join a separate drug plan. To summarize the Medicare annual enrollment period vs Medicare Advantage open enrollment period: Dates: Oct 15 - Dec 7 for AEP, Jan 1 - March 31 for Medicare Advantage OEP Costs: None beyond your plan’s monthly premiums Eligibility to Enroll: AEP — any Medicare beneficiary; OEP — Medicare Advantage enrollees only Form of Medicare Available: AEP — any; MA OEP — Change Medicare Advantage plans or Medicare Advantage to Original Medicare Medicare Enrollment Periods Chart This chart can help you understand Medicare open enrollment vs annual enrollment, along with special enrollment periods. Medicare Annual Enrollment (AEP) Medicare Advantage Open Enrollment (OEP) Medicare Advantage & Part D Special Enrollment (SEP) Start Date October 15th January 1st When a qualifying even occurs End Date December 7th March 31st Varies Notes Any Medicare beneficiary can make any changes Medicare Advantage enrollees only, limited changes Details depend on the qualifying event Learn More About Medicare Enrollment Periods Now that you understand the different enrollment periods, you might decide you want to make a change. Making the right choice for your needs is easier when you talk to a licensed insurance agent. Contact us today for any questions about enrollment periods or comparing Medicare plans!
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Medicare Part D offers important prescription drug coverage and is part of both Original Medicare and Medicare Advantage. As a result, it’s important to understand the Medicare Part D phases that occur each year. There are four Medicare Part D stages. Depending on your drug costs, you may not reach all four in a given year. However, it’s still vital to know what to expect in case your prescription drug needs increase over time. Here’s what you need to know. What are the 4 Stages of Medicare Part D? What are the Medicare Part D stages of coverage? As we mentioned, there are four of them. They start with the deductible period, then initial coverage, followed by the donut hole, and then catastrophic coverage. We’ll go in-depth into each stage so that you can fully understand how they work for you. Deductible Period During the deductible period, you pay the full price of your prescription drugs until you meet your Medicare Part D deductible. The deductible may vary from one plan to another, but Medicare does set a maximum limit. Medicare Part D Deductible 2021 In 2021 the deductible limit for Medicare Part D is $445. Some plans have a $0 deductible, meaning that you skip the first of the Medicare Part D payment stages and move straight into initial coverage. Other plans have a deductible that only applies to certain tiers of medications, while other medications are covered right away. For instance, generic medications may be covered immediately while name-brand medications have a deductible. Make sure you review the Medicare Part D deductible when you compare plans each year so you can choose the plan that’s best for your needs. Initial Coverage Once your deductible is met, you move into initial coverage. This is where your Medicare Part D plan covers your medication, and you only pay a copayment or coinsurance each time. Each plan will have a different list of covered medications and different out-of-pocket costs, so be sure to carefully review the details of your plan. The initial coverage period lasts until you hit $4,130 in total drug costs, which includes both the amount you have paid during the year and the amount your plan paid. Depending on your medical needs, you may not hit the limit, but if you do, you enter the coverage gap known as the Medicare donut hole. Medicare Part D Donut Hole Once you hit the Medicare Part D initial coverage limit, you enter a gap in coverage known as the donut hole. In the past, you had to pay a significant amount of your drug costs during this gap. The coverage gap for all drugs essentially closed in 2020, meaning your share of costs in the “donut hole” is limited to 25% of the drug cost (both brand-name and generic). This percentage will replace the copayment or coinsurance you were paying during the initial coverage period. S For a generic drug that costs $100, you would pay $25 for that drug during the donut hole. For brand-name drugs, even though you only pay 25% of the cost, around 95% of the cost will count toward your out-of-pocket total to move you out of the coverage gap. Once you have paid $6,550 in out-of-pocket costs for prescription drugs, you’ll exit the donut hole and enter catastrophic coverage. Medicare Part D Catastrophic Coverage The final stage of Medicare Part D is catastrophic coverage. What is catastrophic coverage in Medicare Part D? It’s a phase designed to help those who have especially high prescription drug costs. During catastrophic coverage, you’ll pay significantly lower copayments or coinsurance for your remaining prescriptions for the year. For Medicare Part D catastrophic coverage in 2021, you’ll pay 5% of the cost of drugs, and the plan pays for the remainder. Does Medicare Part D Have an Out-of-Pocket Maximum? There is no out-of-pocket maximum for Medicare Part D, but once you hit catastrophic coverage, your out-of-pocket costs drop significantly. Generally, you’ll pay a a minimum of $9.20 for brand-name medication and $3.70 for generic drugs, or 5% of retail costs, whichever is higher. Learn More About Medicare Part D Coverage Stages Medicare Part D is important coverage for many Medicare beneficiaries. That’s why it’s vital to understand the various Part D phases and whether you will enter them in a specific year. Comparing plans is easier with a licensed insurance agent by your side. Contact us to learn more or use our plan comparison tool to learn about plans in your area.
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