Choosing the right Medicare plan is one of the most important decisions seniors face. It’s also one of the most difficult. The healthcare system isn’t user-friendly to begin with. Stack all the Medicare options on top of that, and you’ve got yourself a challenge.
That’s why it’s a good idea to consult a qualified professional about which plan works best for you. It’s tricky terrain that may be difficult to navigate on your own. I recommend raising the issue with your financial advisor as much as 12 to 18 months in advance of enrolling in Medicare.
What Medicare Plans Cover (and What They Don’t)
Medicare can feel a bit like alphabet soup thanks to the naming conventions. Here’s what you need to know about the plans—what they cover, what they don’t, and how much they cost.
Part A is the piece of Medicare nearly everyone gets. Why? Because there are no premiums for people who paid Medicare taxes during their working careers. This covers in-patient hospitalization, skilled nursing facility care, hospice, and some home health services. While the premium is typically $0, other costs such as deductibles and out-of-pocket costs should be considered.
Part B pays for your outpatient care by a doctor, medical tests, any drugs that are administered in a doctor’s office and preventative measures like flu shots. Also included are ambulance services, most durable medical equipment, and mental health services. The base monthly premium in 2025 is $185, but that number could be higher depending on your income.1 You will also need to pay a deductible and 20% coinsurance.
Part A and Part B typically work together to offer medical coverage for retirees, but not everything is covered. They are often collectively referred to as Original Medicare. What’s not included are medical services outside the U.S., long-term care, dental and optical care, dentures, cosmetic and other elective surgeries, acupuncture, hearing aids, and routine foot care. While Medicare pays for care in a skilled nursing facility or rehab center that’s preceded by a hospital stay, it does not cover assisted-living facilities or residential nursing home care.
Part C. Commonly known as Medicare Advantage, Part C is an alternative to Original Medicare. Medicare Advantage can be a good fit for seniors who are healthy and who don’t mind being restricted to a specific network of doctors, healthcare providers, and hospitals. In the Medicare world, it’s the closest equivalent to private insurance. Depending on the state where you reside, a Medicare Advantage plan can cover traditional costs associated with original Medicare and often throws in extras like dental, vision, hearing, prescription drugs, and fitness programs.
These plans, administered by a Medicare-approved private insurer, tend to have lower out-of-pocket costs—with premiums ranging from $0 to $300 per month. But many regions in the country, rural areas in particular, may have limited or no Medicare Advantage providers.
Part D helps to cover outpatient prescription costs and is offered through private companies and has its own monthly premium that will vary by policy. It may not always be the cheapest option when it comes to purchasing medications. Copays and coinsurance factor in. It’s a good idea to review the formulary, or list of covered medications, each year to see which drugs are covered and at what cost tier.
Medicare Supplement Insurance, known as Medigap, does precisely what the name implies. It helps to fill in any gaps not covered by Original Medicare. Some policies, administered by private companies, even include medical care outside the U.S. Medigap offers several different plans, with Plan G being the most comprehensive and far-reaching. The only things Medigap Plan G doesn’t cover are the Part B deductible and anything related to prescription medication. The premium will vary based on the policy you purchase, the zip code you live in, and other factors.
When to Sign Up for Medicare
For most people, the enrollment age is 65. But take note: There’s a seven-month enrollment window that runs for three months before the month of your 65th birthday, through your birthday month, and the full three months after. If you don’t sign up during that window and don’t qualify for a special enrollment period, you may be saddled with a late enrollment penalty that follows you through retirement. This handy flowchart can help you determine when you should enroll.
Have Medicare Questions? We Can Help.
Medicare can be confusing. Talk to a qualified professional today to get professional advice on which Medicare plan is best for your needs. Need help finding a financial advisor in your area? Give us a call today so we can match you with an advisor who will put your needs first.
Matt Lewis is a non-registered affiliate of Cetera Wealth Services LLC.
1 “Medicare Costs,” Medicare.gov, accessed 24 August 2025. https://www.medicare.gov/basics/costs/medicare-costs
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