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Navigating Medicare can feel complex with all the different terms and options available, but understanding the key components can make it much easier. Medicare is divided into several parts, each providing specific types of coverage Part A for hospital care, Part B for medical services, Part C (Medicare Advantage) as an all-in-one alternative, and Part D for prescription drug coverage. In addition to these parts, knowing the enrollment periods, payment structures like premiums and deductibles, and supplemental options such as Medigap can help you manage your healthcare effectively. This cheat sheet simplifies the essential terminology you need to know for a smoother Medicare experience.
Original Medicare
Part A
Hospital and inpatient care
Medicare Part A covers hospital stays, including rooms, nursing, and meals. It also helps with skilled nursing care, hospice, and some home health services. Most pay no premium if they worked 10 years. AsegurateNow can clarify your Part A benefits.
Part B
Medical Services and Outpatient care
Medicare Part B pays for doctor visits, tests, and preventive care like screenings. It covers some equipment and home health. You pay a premium and 20% of costs after a deductible. AsegurateNow helps you navigate Part B enrollment.
Part D
Prescription Drug Coverage
Medicare Part D covers prescription drugs through private plans. It helps with pharmacy medications, with costs based on the plan’s drug list. You pay premiums and copays. AsegurateNow finds a Part D plan to lower your drug costs.
Other Options
Part C
Medicare Advantage Plans (all-in-one plans)
Medicare Part C, or Medicare Advantage, combines hospital and medical coverage, often adding drugs, dental, or vision. Offered by private insurers, costs vary by plan. AsegurateNow compares Part C plans to fit your needs and budget.
Medigap
Supplemental Insurance Coverage
A Medicare Supplemental Plan, or Medigap, helps cover costs that Original Medicare (Parts A and B) doesn’t, like copays, coinsurance, and deductibles. Offered by private insurers, Medigap plans (labeled A-N) provide financial predictability for out-of-pocket expenses, but they don’t include prescription drugs, dental, or vision. While Medigap offers reliable coverage, many clients prefer Medicare Advantage Plans for their all-in-one benefits, including drugs and extras like dental, often at lower premiums. AsegurateNow can guide you to the best option
Enrollment Periods
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Annual Election Period (AEP) or Open Enrollment Period
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A period from October 15 - December 7 each year to make changes to existing coverage.
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Initial Enrollment Period (IEP)
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A 7-month period around your 65th birthday when you can first sign up for Medicare.
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General Enrollment Period (GEP)
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January 1 - March 31 each year for those who missed their IEP.
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Special Enrollment Period (SEP)
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Time outside normal enrollment periods when you can sign up or change plans due to certain life events.
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Medicare Advantage Open Enrollment Period
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From January 1 to March 31 each year, if you already have a Medicare Advantage plan, you can switch to a different Medicare Advantage plan or switch back to Original Medicare (Part A and Part B).
Costs and Payments
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Premium
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Monthly payment for Medicare coverage.
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Deductible
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Amount you pay for covered health care services before Medicare begins to pay.
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Copayment/Coinsurance
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Your share of the costs of a covered health care service, usually a fixed amount (copayment) or a percentage (coinsurance).
Supplemental & Additional Terms
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Medigap (Medicare Supplement Insurance)
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Private insurance that can help pay for some of the health care costs Original Medicare doesn't cover.
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Medically Necessary
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Services or supplies needed for the diagnosis or treatment of your medical condition that meet accepted standards of medical practice.
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Catastrophic Coverage
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Phase of Part D coverage when you only pay a small coinsurance or copayment for covered drugs for the rest of the year.
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Network
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The facilities, providers, and suppliers your health insurer or plan has contracted with to provide health care services.
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Prior Authorization
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Approval from a health plan that may be required before you get a service or fill a prescription to ensure the service is medically necessary.
Prescription Drug Coverage
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Formulary
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A list of prescription drugs covered by a Medicare Part D plan.
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Coverage Gap (Donut Hole)
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A temporary limit on what the drug plan will cover for drugs. After spending a certain amount, you pay more for prescriptions until you reach the catastrophic coverage threshold.
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Creditable Prescription Drug Coverage
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Drug coverage that's expected to pay, on average, at least as much as Medicare's standard prescription drug coverage.