Different parts of Medicare cover different services. You may hear about four parts of Medicare: Part A, Part B, Part C and Part D.
Original Medicare which is administered directly by the federal government (and is the way most people get their Medicare health benefits) has two parts:
- Part A (Hospital Insurance) covers most medically necessary hospital, skilled nursing facility, home health and hospice care. It is free if you have worked and paid Social Security taxes for at least 40 calendar quarters (10 years); you will pay a monthly premium if you have worked and paid taxes for less time.
- Part B (Medical Insurance) covers most medically necessary doctors’ services, preventive care, durable medical equipment, hospital outpatient services, laboratory tests, x-rays, mental health care, and some home health and ambulance services. You pay a monthly premium for this coverage.
Medicare Part D (Prescription Drug Insurance) is the part of Medicare that provides outpatient prescription drug coverage. Part D is provided only through private insurance companies that have contracts with the government—it is never provided directly by the government (like Original Medicare is). Part D is optional for most people; whether you should take it depends on your current drug coverage and needs.
If you want Part D, you must choose Part D coverage that works with your Medicare health benefits. If you have Original Medicare, choose a stand-alone Part D plan.
Medicare Part C is not a separate benefit. Part C is the part of Medicare policy that allows private health insurance companies to provide Medicare benefits. These Medicare private health plans, such as HMOs and PPOs, are sometimes known as Medicare Advantage plans. If you want, you can choose to get your Medicare coverage through a Medicare private health plan instead of Original Medicare.
Medicare private health plans must offer at least the same benefits as Original Medicare (those covered under Parts A and B) but can do so with different rules, costs and coverage restrictions.You can also get Part D as part of the benefits package if you choose. Many different kinds of Medicare private health plans are available. You may pay a monthly premium for this coverage, in addition to your Part B premium.