Key Takeaways

• Medicare covers a wide range of healthcare services, including hospital stays, doctor visits, and prescription drugs, but costs like premiums, deductibles, and copays still apply.

• Understanding your Medicare options helps you make informed choices about coverage, costs, and benefits to fit your needs.

• Reviewing plan changes annually is crucial to ensuring you receive the best coverage for your evolving healthcare needs.

• Knowing the different enrollment periods helps you avoid penalties and ensure uninterrupted coverage.

What Medicare Actually Covers—and What It Doesn’t

Medicare is the backbone of healthcare for millions of Americans, but knowing exactly what it covers—and what it doesn’t—can make a huge difference in your healthcare decisions. While it provides coverage for hospital stays, doctor visits, and prescription medications, there are still some gaps that may require additional coverage or out-of-pocket costs. Being aware of what’s included and what isn’t can help you make smart choices regarding supplemental insurance or alternative healthcare plans.

Here’s what you can expect from Medicare in 2025:

Hospital and Medical Coverage Under Original Medicare

Medicare Part A (Hospital Insurance):

• Covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health services.

• Comes with a deductible of $1,676 per benefit period in 2025.

• Coinsurance applies after 60 days of hospitalization, meaning costs can add up if you have an extended stay.

• After lifetime reserve days are exhausted, you are responsible for all costs.

• Covers limited home healthcare services but does not pay for long-term custodial care.

Medicare Part B (Medical Insurance):

• Covers doctor visits, outpatient services, preventive care, and durable medical equipment.

• Requires a monthly premium of $185 in 2025.

• Has an annual deductible of $257, after which you typically pay 20% of Medicare-approved costs for most services.

• Does not cover routine vision, dental, hearing care, or long-term custodial care.

• Some preventive services, like cancer screenings and vaccinations, are fully covered under Medicare.

Prescription Drug Coverage and the $2,000 Cap

Medicare Part D provides coverage for prescription drugs, helping reduce medication costs. In 2025, a new out-of-pocket cap of $2,000 is in place, meaning once you’ve spent that amount on covered medications, your plan will take care of the rest for the year. This major change eliminates the old coverage gap (donut hole), offering more financial relief for those with high drug costs.

Additionally, Medicare Part D plans may have formularies, meaning only specific drugs are covered. It’s crucial to review your plan annually to ensure your prescriptions remain covered.

What Medicare Doesn’t Cover

Original Medicare has gaps, including:

• Routine dental, vision, and hearing care.

• Long-term care (like nursing home stays beyond Medicare’s coverage limits).

• Most cosmetic procedures.

• Prescription drugs (unless you enroll in Part D).

• Overseas healthcare costs—Medicare generally does not cover medical expenses incurred outside the U.S.

• Services considered elective, experimental, or alternative treatments.

How Medicare Costs Add Up

Medicare isn’t free, and understanding costs helps avoid surprises. Here’s a look at what you’ll pay in 2025:

*Most people get Part A premium-free if they worked and paid Medicare taxes for at least 40 quarters.

Understanding Medicare Enrollment Periods

Missing enrollment deadlines can lead to costly penalties or gaps in coverage. Here are the key dates:

• Initial Enrollment Period (IEP): A 7-month window around your 65th birthday.

• General Enrollment Period (GEP): Runs January 1 – March 31 each year for those who missed their IEP.

• Medicare Open Enrollment: October 15 – December 7 annually, allowing plan changes for the following year.

• Special Enrollment Periods (SEPs): Available for qualifying life events like losing employer coverage or moving.

• Medigap Open Enrollment: A 6-month window starting when you enroll in Part B at age 65, allowing you to buy a Medicare Supplement plan without medical underwriting.

Medicare vs. Other Coverage Options

If you’re still working or have other healthcare coverage, you may wonder how Medicare fits in. Here’s a quick comparison:

• Medicare vs. Employer Coverage: If you’re still working at 65, you may delay Part B without penalty if your employer has 20+ employees.

• Medicare vs. Medicaid: Medicaid helps low-income individuals with healthcare costs, sometimes covering what Medicare doesn’t.

• Medicare and Veterans Benefits: Veterans with VA benefits can still enroll in Medicare, which may offer more provider flexibility.

• Medicare and COBRA: If you retire and choose COBRA, Medicare should be your primary coverage once you turn 65.

• Medicare vs. Private Insurance: Some retirees opt for private supplemental insurance to fill Medicare coverage gaps.

Making the Most of Your Medicare Benefits

Medicare offers various free preventive services, including:

• Annual wellness visits

• Screenings for cancer, diabetes, and heart conditions

• Flu and pneumonia shots

• Cardiovascular disease screenings

• Diabetes self-management training

• Bone density tests for osteoporosis prevention

• Counseling for tobacco use and obesity

These services help you stay ahead of potential health issues, reducing medical costs in the long run.

Why Reviewing Your Plan Every Year Matters

Medicare plans change yearly, and your healthcare needs may shift over time. Reviewing your coverage during the Annual Enrollment Period (October 15 – December 7) ensures you:

• Stay in a plan that covers your prescriptions.

• Avoid unexpected increases in costs.

• Take advantage of any new benefits available.

• Confirm that your preferred doctors and specialists remain in-network.

Final Thoughts on Maximizing Your Medicare Benefits

Understanding Medicare’s coverage, costs, and enrollment rules ensures you get the most out of your benefits. If you’re unsure about which plan works best for you, speaking with a licensed agent listed on this website can help you navigate your options and make the best choice for your healthcare needs.