What Is Medicare? A Complete Guide for Seniors and Those Turning 65
If you’re approaching age 65 or helping a loved one navigate their healthcare options, understanding Medicare is one of the most important steps you can take. As an independent Medicare insurance broker serving clients across New York, New Jersey, and nationwide, I help seniors understand and enroll in the right coverage every day, completely free of charge. Here’s everything you need to know.
The Federal Health Insurance Program Explained
Medicare is the federal health insurance program administered by the Centers for Medicare and Medicaid Services (CMS). It provides health coverage to millions of Americans and is primarily designed for people aged 65 and older. However, it also covers certain younger individuals with qualifying disabilities or conditions.
Who Is Eligible?
You may be eligible if you are:
- Age 65 or older — and a U.S. citizen or permanent legal resident who has lived in the U.S. for at least 5 years
- Under 65 with a qualifying disability — if you’ve received Social Security Disability Insurance (SSDI) for 24 months, you’re automatically enrolled
- Any age with End-Stage Renal Disease (ESRD) — permanent kidney failure requiring dialysis or a transplant
- Any age with ALS (Lou Gehrig’s Disease) — you’re automatically enrolled upon diagnosis
The Four Parts of Coverage
The program is divided into four parts, each covering different types of healthcare services. Understanding each part helps you make smarter decisions when it’s time to enroll.
Part A — Hospital Insurance
Part A covers inpatient care and hospital-related services, including:
- Inpatient hospital stays
- Skilled nursing facility (SNF) care following a qualifying hospital stay
- Hospice care
- Some home health care services
Most people don’t pay a monthly premium for Part A. If you or your spouse worked and paid Medicare taxes for at least 10 years (40 quarters), you receive Part A premium-free. For 2026, the inpatient deductible is $1,736 per benefit period.
Part B — Medical Insurance
Medicare Part B covers outpatient medical services, including:
- Doctor visits and specialist appointments
- Outpatient procedures and surgeries
- Diagnostic tests and lab work
- Durable medical equipment
- Preventive services — including annual wellness visits, screenings, and vaccines
- Mental health services
Part B requires a monthly premium; the standard amount is $202.90 per month in 2026. Higher-income beneficiaries may pay more due to IRMAA surcharges. To estimate your surcharge, use our IRMAA Calculator. The annual Part B deductible is $283 in 2026. After meeting the deductible, the program pays 80% of approved costs, leaving you responsible for the remaining 20%.
Part C — Medicare Advantage
Part C — also known as Medicare Advantage — is an alternative way to receive your benefits through a private insurance company approved by the federal program. These plans must cover everything Original Medicare covers, and many offer additional benefits such as dental, vision, hearing, and prescription drug coverage.
Medicare Advantage plans are available as HMOs, PPOs, and other plan types, each with different network rules, costs, and benefits. In fact, many plans have $0 monthly premiums beyond your Part B premium.
Part D — Prescription Drug Coverage
Part D provides prescription drug coverage through private insurance companies approved by the program. It’s available as a standalone plan added to Original Medicare or as part of a Medicare Advantage plan.
Key figures for 2026 include a maximum annual deductible of $615 and a $2,100 annual out-of-pocket cap on drug costs a significant improvement for seniors with high medication expenses.
What Does Your Coverage Include?
One of the most common questions people ask is exactly what their coverage includes. Here’s a quick breakdown by part:
Part A Includes
- Inpatient hospital stays
- Skilled nursing facility care after a qualifying hospital stay
- Hospice care for terminal illness
- Limited home health care services
- Blood transfusions during an inpatient stay
What Part B Includes
- Doctor visits and specialist consultations
- Outpatient surgery and procedures
- Diagnostic tests, lab work, and imaging
- Durable medical equipment, such as wheelchairs and walkers
- Preventive screenings, including mammograms, colonoscopies, and flu shots
- Mental health and behavioral health services
- Physical, occupational, and speech therapy
- Ambulance services
What Is Not Covered
Original Medicare does not cover everything. Some notable exclusions include:
- Routine dental care, dentures, and most dental procedures
- Routine vision exams and eyeglasses
- Hearing aids and routine hearing exams
- Long-term custodial care
- Care received outside the United States
- Cosmetic surgery
Fortunately, many of these gaps can be addressed through a Medicare Supplement plan or a Medicare Advantage plan that includes extra benefits.
Original Medicare vs Medicare Advantage
When you become eligible, you have a fundamental choice to make between two paths:
- Original Medicare (Parts A and B) — the traditional government-administered program. You can see any doctor or hospital that accepts the program nationwide. Most people add a Supplement plan and a Part D plan to cover remaining costs.
- Medicare Advantage (Part C) — an all-in-one alternative that replaces Original Medicare through a private carrier. It typically includes drug coverage and extra benefits with lower or $0 monthly premiums, but restricts you to a network of providers.
Choosing between these two paths is one of the most important decisions you’ll make at 65. Our guide on Medicare Advantage vs. Medicare Supplement walks through the key differences in detail. As an independent broker, I help you evaluate both options based on your specific health needs, preferred doctors, budget, and lifestyle, with no pressure toward any particular plan or carrier.
When Should You Enroll?
Most people become eligible at age 65. Your Initial Enrollment Period (IEP) is a 7-month window starting 3 months before the month you turn 65, including your birthday month, and ending 3 months after.
Enrolling on time is critical because missing your window can result in permanent late enrollment penalties for both Part B and Part D. If you’re not sure where to start, our step-by-step guide on how to apply walks you through the entire process.
What Does It Cost?
Understanding your costs upfront helps you plan and budget effectively. Here’s a full breakdown for 2026:
- Part A premium: $0 for most people (if you have 40+ quarters of work history)
- Part B premium: $202.90/month standard (higher for higher-income beneficiaries)
- Part B deductible: $257 per year
- Part A deductible: $1,736 per benefit period
- Part D deductible: Up to $615 per year
- Part D out-of-pocket cap: $2,100 per year
For a full breakdown of what you’ll pay, visit our Medicare Costs 2026 page. Without additional coverage, Original Medicare leaves significant gaps, including the 20% coinsurance on all Part B services with no out-of-pocket maximum. Fortunately, a Supplement plan or Medicare Advantage plan can help cover these gaps.
Frequently Asked Questions
Is this coverage free?
Most people receive Part A at no cost if they have at least 40 quarters of work history. Part B requires a monthly premium of $202.90 in 2026. Additionally, coverage through Medicare Advantage or Medigap plans may also have premiums depending on the plan you choose.
What is not covered?
Original Medicare doesn’t cover dental care, routine vision, hearing aids, long-term custodial care, or most care outside the United States. However, some Medicare Advantage plans offer dental, vision, and hearing benefits as extras. Long-term care requires separate coverage, such as long-term care insurance.
Can I have this coverage and employer insurance at the same time?
Yes — in many cases, you can have both. Which coverage pays first depends on your employer’s size and other factors. If you’re still working when you turn 65, I can help you navigate this decision.
What is the difference between Medicare and Medicaid?
The federal Medicare program is primarily for people 65 and older, regardless of income. Medicaid, on the other hand, is a joint federal and state program for people with limited income and resources. Some people qualify for both, which is known as dual eligibility.
How do I choose the right plan?
Choosing the right plan depends on your health needs, budget, preferred doctors, and prescription medications. Working with an independent broker like Craig Smith Insurance Group ensures you get unbiased guidance at no cost to you. Learn more about how a Medicare broker gets paid.
Get Your Free Consultation
Navigating this process for the first time can feel overwhelming — but it doesn’t have to be. As an independent broker, I walk you through every step from understanding your coverage options to enrolling in the right plan for your needs, completely free of charge.
I serve clients across New York, New Jersey, and nationwide by phone, video, or in person. With over 25 years of experience in financial services and more than 317 five-star Google reviews, Craig Smith Insurance Group is ready to help you make the right decision.
📞 Call us at (917) 740-1895 or book your free consultation online today: no pressure, no obligation — just straightforward guidance from an independent broker you can trust.
We are not connected with or endorsed by the United States Government or the federal Medicare program. We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.
