Original Medicare (Parts A and B) covers a lot, but not everything, and it isn’t free. Understanding your share of the costs, called cost sharing, helps you decide whether you need additional coverage.
Part A (hospital insurance)
Premium: Most people pay no Part A premium because they or their spouse worked and paid Medicare taxes long enough.
Deductible: Part A has a deductible for each benefit period, not each year. A benefit period starts when you’re admitted to a hospital and ends after you’ve been out of the hospital or skilled nursing facility for 60 days in a row. That means you could pay the deductible more than once in a year.
Coinsurance: After the deductible, longer hospital stays come with daily coinsurance, and skilled nursing facility stays have a daily coinsurance after day 20.
Part B (medical insurance)
Premium: Most people pay a standard monthly premium, often deducted from their Social Security check. Higher-income members pay more.
Deductible: Part B has a yearly deductible.
Coinsurance: After the deductible, you generally pay 20% of the Medicare-approved amount for doctor visits, outpatient care, and durable medical equipment.
The big gap: no out-of-pocket maximum
Original Medicare has no yearly limit on what you pay out of pocket. That 20% coinsurance has no cap, which can add up quickly with a serious illness. That’s why many people add one of these:
- A Medicare Supplement (Medigap) policy, which helps pay deductibles and coinsurance
- A Medicare Advantage plan, which has a yearly out-of-pocket maximum for in-network services
- Medi-Cal or a Medicare Savings Program, if you qualify based on income
What Original Medicare doesn’t cover
Original Medicare generally doesn’t cover routine dental care, eye exams for glasses, hearing aids, or most prescription drugs (which is what Part D is for).
The exact premium, deductible, and coinsurance amounts change every year. Check the current amounts at Medicare.gov.
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This article is for general educational purposes and is not a recommendation of any specific plan. Plan availability, benefits, and costs vary by plan and county and may change each year. For complete information, contact Medicare.gov or 1-800-MEDICARE.