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Medicare 101 · Updated for 2026

Medicare, explained in plain English

The parts, the plans, the deadlines and the costs — gathered into one calm, clear guide. Read at your own pace, then let us help with the decisions.

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Annual Enrollment Period

October 15 – December 7, 2026

Opens in 2 days

Review or change your Medicare Advantage or Part D coverage for 2027. Changes take effect January 1.

See every enrollment period

01 · The basics

What Medicare is — and who can get it

Medicare is the federal health insurance program for people 65 and older, and for some younger people with certain disabilities or conditions. The Centers for Medicare & Medicaid Services (CMS) runs the program, and Social Security handles most sign-ups.

Medicare doesn’t pay for everything, and it isn’t free: most people pay a monthly premium for Part B and share some costs when they get care. That is why understanding your choices — and your deadlines — matters so much.

  • Age 65 or older

    Most people qualify at 65. If you or your spouse worked and paid Medicare taxes for about 10 years, Part A is usually premium-free.

  • Under 65 with a disability

    After 24 months of Social Security disability benefits (or certain Railroad Retirement disability benefits), you are enrolled automatically.

  • ALS (Lou Gehrig’s disease)

    Medicare begins as soon as your disability benefits start — there is no 24-month wait.

  • End-Stage Renal Disease

    People of any age with permanent kidney failure who need regular dialysis or a kidney transplant may qualify.

Getting Social Security already? If your benefits started at least four months before you turn 65, you’ll be enrolled in Part A and Part B automatically. Otherwise, you sign up through Social Security — online, by phone or at a local office.

02 · Parts A, B, C & D

The four parts of Medicare

Parts A and B together are called Original Medicare. Part C (Medicare Advantage) is another way to get those same benefits through a private plan, and Part D adds prescription drug coverage. Choose a part to see what it covers and costs.

Part A Hospital insurance

Helps pay for your care when you are admitted to a hospital, and for some care afterwards.

What it covers

  • Inpatient care in a hospital
  • Skilled nursing facility care after a qualifying inpatient hospital stay (not long-term custodial care)
  • Hospice care
  • Some home health care

What it costs in 2026

Monthly premium
$0 for most people $311 or $565 a month if you or your spouse paid Medicare taxes for less than about 10 years
Hospital deductible
$1,736 per benefit period
Hospital days 61–90
$434 a day
Days 91–150 (lifetime reserve days)
$868 a day
Skilled nursing days 21–100
$217 a day

Good to know

Hospital days 1–60 cost $0 after the deductible. A benefit period starts the day you are admitted and ends after 60 days in a row without inpatient hospital or skilled nursing care — so the deductible can apply more than once in a year. You have 60 lifetime reserve days in total.

Source: CMS — 2026 Medicare Parts A & B premiums and deductibles

Part B Medical insurance

Helps pay for doctors, outpatient care, preventive services and medical equipment.

What it covers

  • Doctors’ visits, including specialists
  • Outpatient care, lab tests and many outpatient procedures
  • Preventive services, such as screenings and flu shots
  • Durable medical equipment, such as walkers, wheelchairs and oxygen
  • Ambulance services, outpatient mental health care and some home health care

What it costs in 2026

Standard monthly premium
$202.90 Higher if your income is above $109,000 (individual) or $218,000 (joint)
Yearly deductible
$283
After the deductible
Usually 20% of the Medicare-approved amount

Good to know

Original Medicare has no yearly limit on what you pay out of pocket. That is why many people add a Medicare Supplement policy or choose a Medicare Advantage plan.

Source: CMS — 2026 Medicare Parts A & B premiums and deductibles

Part C Medicare Advantage

An all-in-one way to get your Medicare benefits through a private plan approved by Medicare.

What it covers

  • The hospital and medical services Original Medicare covers
  • Usually prescription drug coverage
  • Often extras such as dental, vision, hearing or fitness benefits — these vary by plan
  • A yearly limit on your out-of-pocket costs for covered services

What it costs in 2026

Monthly premium
Your Part B premium, plus the plan’s premium Some plans have a $0 plan premium
When you get care
Copays or coinsurance set by the plan
Yearly out-of-pocket limit
Every plan has one; the amount varies by plan

Good to know

Most plans use networks of doctors and hospitals (such as HMOs and PPOs) and may require referrals or approval before some services. Plans, costs and benefits vary by area and change every year.

Source: Medicare.gov — Medicare costs

Part D Prescription drug coverage

Helps pay for prescription drugs — as a standalone plan or as part of a Medicare Advantage plan.

What it covers

  • Prescription drugs on the plan’s list of covered drugs (its “formulary”)
  • A standalone plan to pair with Original Medicare, or coverage built into most Medicare Advantage plans
  • Covered insulin for no more than $35 for a month’s supply

What it costs in 2026

Monthly premium
Varies by plan Higher-income households pay an extra amount
Yearly deductible
No more than $615 in 2026 No more than $700 for plans in 2027
Yearly out-of-pocket cap
$2,100 in 2026 After that, $0 for covered drugs for the rest of the year · $2,400 in 2027

Good to know

If you go 63 days or more in a row without Part D or other creditable drug coverage after your Initial Enrollment Period, you may owe a late penalty for as long as you have drug coverage. Extra Help can lower drug costs for people with limited income and resources.

Source: Medicare.gov — Costs for Medicare drug coverage

03 · Your two paths

Original Medicare or Medicare Advantage?

Most people choose one of two paths. Neither is right for everyone — it depends on your doctors, your health, your budget and how you like to receive care.

Path one

Original Medicare

  • Part A Hospital insurance
  • Part B Medical insurance
  • + Medigap Optional — helps pay your share of costs
  • + Part D Optional — prescription drug coverage

Path two

Medicare Advantage

  • Part C One private plan, approved by Medicare, that includes:
    • Part A hospital coverage
    • Part B medical coverage
    • Usually Part D drug coverage
    • Often extra benefits, which vary by plan
How the two paths compare
Original Medicare with Medigap & Part D Medicare Advantage Part C
How it works Medicare pays its share of covered services. A Medigap policy can pay much of the rest, and a separate Part D plan covers drugs. A private plan approved by Medicare provides your hospital and medical coverage — and usually drug coverage — in one plan.
Doctors and hospitals Any doctor or hospital in the U.S. that accepts Medicare. Usually a network. Going outside it may cost more or may not be covered, except for emergencies and urgent care.
Referrals to specialists Generally not needed. Often needed, especially in HMO plans.
Approval before care Rarely required. Plans may require approval (prior authorization) for certain services.
Monthly premiums Part B premium, plus your Medigap and Part D premiums. Part B premium, plus the plan’s premium — some plans have a $0 plan premium.
Costs when you get care Depends on your Medigap plan; many plans leave little to pay. Without one, you usually pay 20% with no cap. Copays and coinsurance as you use services, set by each plan.
Yearly out-of-pocket limit None with Original Medicare alone. A Medigap policy pays much or all of your share, depending on the plan. Yes — every plan has one, and the amount varies by plan.
Dental, vision and hearing Mostly not covered; you can buy separate coverage. Often included, with benefits that vary by plan.
Travel Coverage anywhere in the U.S. Some Medigap plans help with emergency care abroad. Non-emergency care is generally limited to the plan’s network and service area; emergency care is covered anywhere in the U.S.
Changing your mind later You can switch Part D plans each year. Changing Medigap policies after your open enrollment period may require health questions. You can change plans each year. You can return to Original Medicare, but buying a Medigap policy then may require health questions.

Plan availability, costs and benefits vary by area and change each year.

04 · Medicare Supplement

Medigap plans, side by side

Medicare Supplement Insurance — usually called Medigap — is sold by private companies to help pay the costs Original Medicare leaves to you, such as deductibles and coinsurance.

  • Plans are standardized and named by letter, so Plan G from one company has the same benefits as Plan G from another. Prices and service can differ.
  • You must have Part A and Part B, and you keep paying your Part B premium.
  • Each person needs their own policy — spouses buy separate plans.
  • Medigap works only with Original Medicare, not with Medicare Advantage, and doesn’t include drug coverage.

Show plans

What each Medigap plan pays (2026) — * Plans C and F are only for people eligible for Medicare before 2020
Benefit Plan A Plan B Plan C * Plan D Plan F * Plan G Plan K Plan L Plan M Plan N
Part A coinsurance and hospital costs Up to an extra 365 days after Medicare benefits are used up
Part B coinsurance or copayment
Blood (first 3 pints)
Part A hospice care coinsurance or copayment
Skilled nursing facility coinsurance
Part A deductible $1,736 per benefit period in 2026
Part B deductible $283 in 2026
Part B excess charges Extra amounts some doctors may charge above Medicare’s approved amount
Foreign travel emergency Up to plan limits
Yearly out-of-pocket limit 2026 amounts $8,000 $4,000
  • Plans C and F (marked *) can only be bought by people who were eligible for Medicare before January 1, 2020. If that includes you, you may still be able to buy them.
  • † Plan N pays 100% of Part B coinsurance, except for a copayment of up to $20 for some office visits and up to $50 for emergency room visits that don’t lead to an inpatient admission.
  • Plans K and L: once you reach the yearly out-of-pocket limit ($8,000 for K and $4,000 for L in 2026) and pay the Part B deductible, the plan pays 100% of covered services for the rest of the year.
  • Plans F and G may also be offered with a high deductible: you pay the first $2,950 of covered costs in 2026 before the policy pays.
  • Foreign travel emergency: 80% of the cost of emergency care that begins during the first 60 days of a trip outside the U.S., after a $250 yearly deductible, up to a $50,000 lifetime limit.
  • Medigap policies don’t include drug coverage — pair one with a Part D plan. They also can’t be used with a Medicare Advantage plan.

New Jersey note: In New Jersey, people under 65 who have Medicare because of a disability, with Part A starting on or after January 1, 2020, can buy only Medigap Plan D until they turn 65.

Sources: Medicare.gov — Compare Medigap plan benefits · NJ SHIP — Medigap Plan Benefits chart (2026)

05 · Dates & deadlines

When to enroll

Medicare has set windows for signing up and making changes. Getting the timing right helps you avoid gaps in coverage and penalties that can last for life.

Find your Initial Enrollment Period

You are in your Initial Enrollment Period now — it ends April 30, 2027. Sign up this month and your coverage would start January 1, 2027.

  1. 3 months before Oct 2026 Coverage starts Jan 1, 2027
  2. 2 months before Nov 2026 Coverage starts Jan 1, 2027
  3. 1 month before Dec 2026 Coverage starts Jan 1, 2027
  4. The month you turn 65 Jan 2027 Coverage starts Feb 1, 2027
  5. 1 month after Feb 2027 Coverage starts Mar 1, 2027
  6. 2 months after Mar 2027 Coverage starts Apr 1, 2027
  7. 3 months after Apr 2027 Coverage starts May 1, 2027
  • Already getting Social Security? If your benefits started at least four months before you turn 65, you are enrolled in Part A and Part B automatically, and your card arrives about three months before coverage begins.
  • Born on the 1st? Medicare counts you as turning 65 the month before, so your whole window — and your earliest coverage date — moves one month earlier. Tick the box above to see it.
  • Still working? With group coverage from a current job, you may be able to wait without a penalty — see “Your situation” below.

Every enrollment period at a glance

Every year

  • Annual Enrollment Period (AEP)

    October 15 – December 7, every year.

    Opens in 2 days

    What you can do
    Join, switch or drop a Medicare Advantage or Part D plan, or move between Medicare Advantage and Original Medicare.
    Changes take effect
    January 1 of the following year.

  • Medicare Advantage Open Enrollment

    January 1 – March 31, every year.

    Opens in 80 days

    What you can do
    If you are in a Medicare Advantage plan, make one change: switch to another Medicare Advantage plan, or return to Original Medicare (and join a Part D plan).
    Changes take effect
    The first day of the month after the plan receives your request.

  • General Enrollment Period (GEP)

    January 1 – March 31, every year.

    Opens in 80 days

    What you can do
    Sign up for Part A and/or Part B if you missed your Initial Enrollment Period and do not qualify for a Special Enrollment Period. Late penalties may apply.
    Changes take effect
    The first day of the month after you sign up.

Based on your own dates

  • Initial Enrollment Period (IEP)

    Seven months around your 65th birthday: the 3 months before your birthday month, that month, and the 3 months after.

    Depends on your dates

    What you can do
    Sign up for Part A and Part B, and join a Medicare Advantage or Part D plan.
    Changes take effect
    Depends on the month you sign up — use the calculator above to see your dates.

  • Medigap Open Enrollment Period

    Six months, starting the first month you are 65 or older and have Part B. It happens once and does not repeat.

    Depends on your dates

    What you can do
    Buy any Medigap policy sold in your state, at the same price as people in good health — insurers cannot turn you down or charge more because of your health.
    Changes take effect
    Set when you apply — we help you line it up with your Part B start date.

  • Special Enrollment Periods (SEP)

    After certain life events — for example, when job-based coverage ends, when you move, or if you qualify for Extra Help.

    Depends on your dates

    What you can do
    Sign up for or change coverage outside the usual windows. After a job or employer group coverage ends (whichever comes first), you have 8 months to sign up for Part B without a penalty.
    Changes take effect
    Depends on the situation.

06 · Costs

What Medicare costs in 2026

These are the standard amounts set each year for Original Medicare and Part D. Medicare Advantage and Medigap plans set their own premiums and costs, which vary by plan and area.

  • 2026 Part B standard premium $202.90 per month
  • 2026 Part B deductible $283 per year
  • 2026 Part A hospital deductible $1,736 per benefit period
  • 2026 Part A premium $0 for most people (otherwise $311 or $565 a month)
  • 2026 Part D deductible $615 per year, at most
  • 2026 Part D out-of-pocket cap $2,100 per year for covered drugs

Higher incomes: the Part B and Part D premiums include an extra monthly amount if your income is above $109,000 (individual tax return) or $218,000 (joint return).

Looking ahead to 2027: for Part D plans starting in January, the deductible can be no more than $700 and the yearly out-of-pocket cap rises to $2,400.

Medicare amounts change every year. The figures above are for 2026.

Sources: CMS — 2026 Medicare Parts A & B premiums and deductibles · Medicare.gov — Costs for Medicare drug coverage · Medicare.gov — Medicare costs

Estimate a late-enrollment penalty

If you sign up late without qualifying coverage, Medicare adds a penalty to your monthly premium — usually for as long as you have that coverage. Enter the number of months to see an estimate.

Part B late penalty

10% of the standard premium for each full 12 months you could have had Part B but didn’t sign up.

After your Initial Enrollment Period ended — don’t count months you had coverage from a current job.

+$40.60 a month added to your Part B premium 2 full years × 10% = 20% of $202.90 · your 2026 premium would be about $243.50 a month

Part D late penalty

1% of the national base premium ($38.99 in 2026) for each full month without creditable drug coverage, rounded to the nearest 10¢.

Full months after your Initial Enrollment Period with no Part D or other creditable drug coverage (gaps of 63 days or more count).

+$5.50 a month added to your drug plan premium 14 months × 1% × $38.99 = $5.46, rounded to $5.50

An estimate, not a bill. Penalties are usually charged for as long as you have that coverage. The Part D amount is recalculated each year from the new base premium. People who qualify for a Special Enrollment Period, a Medicare Savings Program or Extra Help may not owe a penalty.

Source: Medicare.gov — Avoid late enrollment penalties

07 · Pitfalls

Common mistakes — and how to avoid them

  1. Assuming Medicare starts on its own

    You are enrolled automatically only if you already get Social Security (or Railroad Retirement) benefits at least four months before you turn 65. Otherwise, you need to sign up.

  2. Delaying Part B without the right coverage

    Only coverage from current employment (yours or your spouse’s) lets you delay Part B safely. Retiree coverage and COBRA do not count — waiting can mean a lifelong penalty and a gap in coverage.

  3. Skipping drug coverage because you take few medicines

    Going 63 days or more without Part D or other creditable drug coverage can lead to a penalty that lasts as long as you have drug coverage.

  4. Missing your Medigap window

    Your strongest right to buy any Medigap policy without health questions lasts six months. After that, you may be turned down or charged more because of your health.

  5. Choosing a plan by premium alone

    Check your doctors, hospitals, prescriptions and pharmacy — and look at the total yearly cost, not just the monthly premium.

  6. Not reviewing your plan each fall

    Plans can change premiums, drug lists and networks every January. Your Annual Notice of Change, mailed each fall, explains what is different.

  7. Forgetting about your Health Savings Account

    Stop HSA contributions about six months before you sign up for Medicare or apply for Social Security, because Part A coverage can start up to six months back.

  8. Expecting Medicare to cover long-term care

    Medicare does not pay for ongoing custodial care. It may cover skilled nursing care for a limited time after a qualifying hospital stay — and time spent “under observation” does not count toward that stay.

08 · Real-life questions

Answers for your situation

Everyone’s path to Medicare is a little different. Open the situation that sounds most like yours.

If you (or your spouse) have group health coverage through current employment at a company with 20 or more employees, that plan usually pays first, and you can generally delay Part B without a penalty. Many people still take premium-free Part A.

If the employer has fewer than 20 employees, Medicare usually pays first — so you will generally want Part A and Part B when you are first eligible. Ask your benefits office how its plan works with Medicare, and remember to stop Health Savings Account contributions before Medicare starts.

You have an 8-month Special Enrollment Period to sign up for Part B, starting when the job or the coverage ends, whichever comes first. Don’t wait for COBRA to run out — COBRA does not extend this window.

Your six-month Medigap Open Enrollment Period begins when your Part B starts, and you’ll want Part D or other creditable drug coverage in place so you don’t go 63 days or more without it.

You are enrolled in Part A and Part B automatically after receiving Social Security disability benefits for 24 months — or as soon as benefits begin if you have ALS.

Medigap choices can be limited before 65. In New Jersey, if your Part A started on or after January 1, 2020, Plan D is the only Medigap plan available to you until you turn 65. At 65, you get a new chance to enroll, including a Medigap Open Enrollment Period.

Retiree coverage usually works alongside Medicare and often requires you to have both Part A and Part B. Because it is not coverage from current employment, delaying Part B can lead to a penalty.

Check with the plan before you change anything — if you drop retiree coverage, you may not be able to get it back.

Moving out of your plan’s service area — or to an area with new plan options — can open a Special Enrollment Period to change your Medicare Advantage or Part D plan.

A Medigap policy can generally stay with you anywhere in the U.S., although your premium may change. Let us know before you move so we can plan the timing.

If you qualify for both, you may have special plan options, help with costs and additional chances to change plans during the year. You also qualify for Extra Help with drug costs automatically.

Medicare Savings Programs can help pay your Part B premium, and sometimes more. Extra Help lowers prescription drug costs.

In New Jersey, state programs such as PAAD and Senior Gold may also help with prescriptions. NJ SHIP (1-800-792-8820) can help you check what you may qualify for.

09 · Working with us

How we help

Medicare decisions are personal. We sit down with you — in person, by phone or by video — and make sure you understand every option before you choose.

  • Explain it all, plainly

    Parts A, B, C and D, your enrollment dates and your costs — at your pace, with family welcome.

  • Compare plans side by side

    We check your doctors, prescriptions and budget against plans from the companies we represent.

  • Enroll correctly and on time

    We help you avoid gaps in coverage and late penalties, from sign-up questions to plan applications.

  • Review your plan every fall

    During Annual Enrollment, we will check whether your plan still fits for the year ahead.

10 · Straight from the source

Official resources

You can always check with Medicare directly, or get free, independent counseling from New Jersey’s State Health Insurance Assistance Program.

Ready to talk it through?

Bring your questions, your Medicare card and your list of medications. We’ll explain your options and help you choose with confidence.

Book a Medicare Review Call Gautam · (973) 722-9191 Call Shweta · (732) 543-9835
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