Understanding the Different Parts of Medicare

Medicare can be a lifeline in retirement, but it’s also one of the most misunderstood programs out there. Between Parts A, B, C, D, and the supplemental Plans like F, G, and N, it’s easy to get lost in the alphabet. The truth is, each part and plan serves a specific purpose; and understanding how they fit together can save you a lot of stress and money down the road.

Here’s a simple, clear breakdown of what each part covers and how supplemental plans come into play.

Medicare Part A: Hospital Insurance

Part A is often called hospital insurance, because it helps cover care you receive as an inpatient. This includes hospital stays, skilled nursing facilities (after a qualifying hospital stay), hospice care, and some home health services.

Most people don’t pay a premium for Part A, since it’s funded through the Medicare taxes you’ve paid during your working years. However, there are still deductibles and coinsurance costs that can add up, especially for longer hospital stays.

Think of Part A as your safety net for major hospital-based care. It’s the foundation of your Medicare coverage.

Medicare Part B: Medical Insurance

Part B covers outpatient and preventive care. This includes doctor visits, lab tests, imaging, durable medical equipment, and preventive screenings like mammograms and colonoscopies.

Unlike Part A, Part B does have a monthly premium, which is adjusted based on your income. You’ll also have a deductible and typically pay 20% of the cost for covered services once that deductible is met.

Part B is what most people think of as “regular health insurance.” It’s what you use for routine care and ongoing medical needs outside the hospital.

Medicare Part C: Medicare Advantage

Part C, also known as Medicare Advantage, is an alternative way to receive your Medicare benefits. Instead of getting coverage directly through Original Medicare (Parts A and B), you can choose a private insurance plan approved by Medicare that bundles them together; and often adds more benefits.

Many Medicare Advantage plans include prescription drug coverage, dental, vision, hearing, and even wellness programs. You still need to pay your Part B premium, and sometimes an additional plan premium, but you may have lower out-of-pocket costs and added perks.

These plans can be a great fit for people who want an all-in-one solution and are comfortable with using a provider network.

Medicare Part D: Prescription Drug Coverage

Part D helps cover the cost of prescription medications. It’s offered through private insurance companies that contract with Medicare, and you can either add a Part D plan to Original Medicare or enroll in a Medicare Advantage plan that includes drug coverage.

Each Part D plan has its own list of covered medications, known as a formulary, so it’s important to review which drugs are included before enrolling. You’ll also want to watch for the “donut hole,” a temporary coverage gap that may affect your costs depending on your prescription spending.

The right Part D plan can make a big difference in keeping medication costs manageable over time.

Medicare Supplement Plans (Medigap): F, G, and N

If you stick with Original Medicare (Parts A and B), you’ll notice it doesn’t cover everything. That is where Medigap comes in. Medigap plans labeled with letters like F, G, and N help pay for the gaps in Medicare coverage such as deductibles, copayments, and coinsurance.

Plan F was once the most comprehensive option, covering nearly all out of pocket costs. However, it is no longer available to anyone who became eligible for Medicare after January 1, 2020. If you qualified before that date, you can still keep or enroll in Plan F.

Plan G is now the most popular choice for new enrollees. It covers everything Plan F does except the Part B deductible. Once you meet that deductible, virtually all remaining Medicare approved expenses are covered.

Plan N offers slightly lower premiums in exchange for small copayments, usually up to $20 for doctor visits and $50 for emergency room visits if you are not admitted. It is a great balance between affordability and coverage, especially for people who do not visit the doctor frequently.

Bringing It All Together

Medicare is designed to give you options, not confusion. Parts A and B form the core of your coverage, while Part C (Medicare Advantage) and Medigap Plans like F, G, and N give you different ways to fill in the gaps and control your costs. Part D ensures you are covered when it comes to prescriptions.

The best choice depends on your lifestyle, health needs, and financial goals. Taking the time to compare plans each year, especially during Medicare Open Enrollment, can make a real difference in your peace of mind and your wallet.

If you would like help reviewing your options or learning which plan may fit you best, our team at American Independent Financial Group is ready to guide you. Visit www.americanifg.com/medicare or call 405 296 8556 to speak with a Medicare specialist today.