Part A covers inpatient hospital stays, hospice care, nursing home costs, and even limited home health benefits. The types of hospitals covered under Medicare Part A include:

• Acute care hospitals (meaning urgent or immediate need)
• Critical access hospitals
• Long-term care hospitals
• Inpatient rehabilitation centers
• Mental health care facilities
• Some clinical research studies

Medicare Part A will also cover the costs of private and at-home health services as long as they are deemed “medically necessary.” In plain terms, Medicare defines a medical necessity as anything a doctor deems necessary to help someone survive or get better. Medically necessary at home services can include:

• Physical therapy
• Part-time skilled nursing services
• Speech and language pathology services
• Part-time home health aide care
• Medical social services
• Occupational therapy
• Durable medical equipment

Additional care covered by Part A:

• Skilled Nursing Care

If you need skilled nursing care, these services must be provided at a Medicare-certified facility in order to meet coverage requirements. To meet coverage requirements for a nursing home, your doctor must certify that you need daily, skilled nursing services that cannot be given in your home. This can include things like IV medications or physical therapy. Medicare Part A won’t cover long-term or personal care.

• Hospice Coverage

Hospice care focuses on palliative, not curative, care during which the patient is made as comfortable as possible. For patients in hospice, Part A will sometimes cover the costs of services that aren’t typically included in the plan, such as counseling. If a patient must be hospitalized for pain management or a similar treatment, Part A will only cover room and board.

Medicare Part B is medical insurance coverage. It covers any medical supplies and services necessary to treat health problems and medical conditions. Some of the services covered under Medicare Part B include:

• Outpatient care
• Ambulance services
• Durable medical equipment
• Preventative services

In some instances, Medicare Part B will also cover intermittent or part-time rehab and home health services.

Medicare Part C is also known as Medicare Advantage and is sometimes abbreviated to simply an MA plan. Medicare Advantage plans are administered via private health insurance companies who have been approved by the Centers for Medicare & Medicaid Services (CMS). Medicare Advantage required by law to give you benefits as good or better than Original Medicare. They provide the same level of insurance coverage as Original Medicare, however, and some Medicare Advantage plans offer additional coverage, such as hearing, dental, vision, and prescriptions*.

The most common types of Medicare Advantage plans include:

• Health Maintenance Organization (HMO) plans
• Private Fee-for-Service (PFFS) plans
• Preferred Provider Organization (PPO) plans
• Special Needs plans (SNP)

Less common types of Medicare Advantage plans include:

• HMO Point-of-Service (HMOPOS) plans
• Medical Savings Account (MSA) plans

Every Medicare Advantage plan is going to charge different out-of-pocket costs. Each plan will also have different coverage rules. For example, you might need a referral before seeing a specialist and receiving coverage from the plan. Most Medicare Advantage plans include Medicare Part D, prescription drug coverage. 

Read more about what you need to know regarding Medicare Advantage plans.

*The extra services and benefits that are covered by Medicare Advantage vary widely between plans. There may not be a plan in your area that has all of these benefits in one plan.

Because Part D plans are sometimes referred to as “add-on” coverage, these plans can seem like a minor piece of your Medicare insurance. However, prescription coverage is absolutely critical to health care coverage and should not be an afterthought. For many, it’s one of the most challenging and potentially costly aspects of Medicare. There’s a lot to consider when looking at your options, from the variety of plan choices, plan ratings, and various drug tiers.

The first option is to simply enroll in Part D coverage and add it to an Original Medicare plan. The second option is to combine Medicare Part D into a Medicare Advantage plan.

You can enroll in a stand-alone prescription drug plan if you meet these conditions:

You’re enrolled in either Medicare Part A or Part B.

You permanently reside in the service area of the plan.

Shopping for prescription drug coverage as a Medicare recipient can be a bit confusing. In many cases, cheaper isn’t better. The easiest way to shop for a Medicare Part D plan that’s right for you is to compare different plans’ coverage options for the medications you’re currently taking. Low-cost plans may not pay for your prescriptions. In that case, you’ll be stuck with higher out-of-pocket costs for your medicines. So saving on the monthly premium might not be worth it if it means higher out-of-pocket costs. Another issue to be aware of is the Medicare Part D coverage gap, also commonly known as the “donut hole.”

The donut hole is basically a gap in coverage. This gap is the phase of Part D Medicare coverage that occurs after your initial coverage period has ended. This gap occurs once you and your drug plan have spent a certain amount of money for drugs. The coverage gap forces you to pay a much higher percentage of drug costs until you reach the other end of the gap. The Part D coverage gap is considered closed as of January 1, 2020.

New Part D regulations are going into effect in 2025; read more about those changes here.