Key Takeaways

• Medicare does not cover all healthcare expenses, and assuming full coverage can result in unexpected out-of-pocket costs.

• Understanding coverage gaps, eligibility limitations, and additional plan options is essential to avoid surprises.

What Medicare Covers and What It Doesn’t

Many people believe that once they enroll in Medicare, all their health-related costs will be taken care of. While Medicare is a valuable federal program that provides health insurance to people aged 65 and older, as well as certain younger individuals with disabilities, it doesn’t cover everything. Knowing what is included—and what isn’t—can help you plan better.

What Original Medicare Includes

Original Medicare is made up of two main parts:

• Part A (Hospital Insurance): Covers inpatient hospital stays, skilled nursing facility care, hospice care, and limited home healthcare.

• Part B (Medical Insurance): Covers outpatient care, doctor visits, preventive services, durable medical equipment, and some home healthcare.

Even though these parts provide broad coverage, they come with limitations and cost-sharing requirements.

What Original Medicare Leaves Out

Some significant areas Medicare does not cover include:

• Most dental care and dentures

• Routine vision exams and eyeglasses

• Hearing aids and related exams

• Long-term custodial care (like nursing home care for daily living)

• Prescription drugs (unless enrolled in Part D)

• Care received outside the United States

These gaps can leave you exposed to high out-of-pocket costs if you are unprepared.

The Financial Responsibility You Still Carry

Even for the services Medicare does cover, you’re still responsible for certain out-of-pocket expenses. These include premiums, deductibles, copayments, and coinsurance.

2025 Cost Snapshot

• Part A: Most people don’t pay a premium if they paid Medicare taxes for at least 10 years. However, the deductible is $1,676 per benefit period.

• Part B: Comes with a monthly premium, which is $185 in 2025. The annual deductible is $257. After the deductible, you usually pay 20% of the Medicare-approved amount.

There is no limit on what you might spend out-of-pocket for Part A and B services unless you have additional coverage.

Prescription Drugs Are Not Automatically Covered

Medicare does not include prescription drug coverage under Parts A and B. If you want help covering medication costs, you need to enroll in a standalone Medicare Part D plan or a Medicare Advantage plan that includes drug coverage.

Even when you do have drug coverage, you may still face:

• A yearly deductible (up to $590 in 2025)

• Copayments or coinsurance

• Coverage limitations based on drug tiers or formularies

And although the Part D coverage gap, or “donut hole,” is eliminated as of 2025, your total out-of-pocket drug spending is now capped at $2,000 annually.

Dental, Vision, and Hearing: Major Coverage Gaps

Routine dental cleanings, eye exams, and hearing aids are essential for many older adults, yet they are not covered by Original Medicare. You must either pay out-of-pocket or seek additional coverage.

Some may opt for supplemental insurance that includes these benefits, but this is not automatic and typically comes with additional costs and eligibility requirements.

Long-Term Care Isn’t Covered the Way You Think

One of the most common misconceptions is that Medicare will pay for long-term care, such as a stay in a nursing home or in-home custodial care. Medicare only pays for short-term skilled nursing facility care after a qualifying hospital stay.

What it does not cover:

• Assisted living facilities

• Ongoing help with daily activities like bathing or dressing

• In-home custodial care beyond medical needs

If you require long-term support, you’ll need to consider personal savings, long-term care insurance, or Medicaid if eligible.

Travel Coverage Is Limited

Original Medicare does not generally provide coverage for medical services received outside of the U.S. If you plan to travel internationally, you need to consider additional travel medical insurance or specific Medicare plans that offer some foreign travel coverage.

There are exceptions for emergencies near U.S. borders, but routine or elective care overseas is not covered.

The Role of Supplemental Insurance

To help manage the out-of-pocket costs and fill the gaps in coverage, many people enroll in additional plans. These may include:

• Medigap (Medicare Supplement Insurance): Helps pay for Part A and B coinsurance, deductibles, and other expenses not covered by Original Medicare.

• Medicare Advantage (Part C): Offers an alternative to Original Medicare and may include benefits like dental, vision, hearing, and prescription drug coverage.

These plans have separate rules, networks, and costs, and you must carefully evaluate whether they meet your health and budget needs.

Annual Enrollment Doesn’t Mean Automatic Improvement

Many assume that once they are enrolled in Medicare, their plan will adapt automatically to meet their changing needs. That’s not true.

You Need to Review Annually

Every year between October 15 and December 7, Medicare’s Annual Enrollment Period (AEP) allows you to:

• Switch between Original Medicare and Medicare Advantage

• Change or enroll in a Part D plan

• Review cost changes, formularies, and network changes

Failing to review your coverage annually can leave you with higher costs or inadequate coverage in the new year.

Income Can Affect What You Pay

Your modified adjusted gross income (MAGI) from two years prior affects your Part B and Part D premiums. In 2025, if your income in 2023 exceeds $106,000 (individual) or $212,000 (joint), you may pay higher premiums.

This is known as the Income-Related Monthly Adjustment Amount (IRMAA). It’s important to plan ahead, especially if you’re selling property, retiring, or receiving other large income payments that could push you into a higher bracket.

Preventive Care Is Covered—But Know What That Means

Original Medicare covers many preventive services with no cost to you, such as:

• Annual wellness visits

• Certain cancer screenings

• Flu and pneumonia shots

• Diabetes screenings

However, any diagnostic or follow-up services may result in out-of-pocket costs. For example, a screening mammogram may be free, but if follow-up tests are needed, those fall under Part B cost-sharing rules.

Understanding Plan Networks and Restrictions

If you decide to enroll in a Medicare Advantage plan, it’s crucial to understand that many of these plans use provider networks. This means:

• You may be limited to seeing doctors and hospitals within a specific network.

• Referrals may be required to see specialists.

• Out-of-network care might not be covered or may cost significantly more.

Unlike Original Medicare, which allows you to see any provider that accepts Medicare, Advantage plans come with managed care rules that may restrict your choices.

Timing Affects Your Options

Enrollment windows matter. Missing them can result in delays or penalties:

• Initial Enrollment Period (IEP): Starts 3 months before you turn 65, includes your birthday month, and ends 3 months after.

• General Enrollment Period (GEP): January 1 to March 31 if you missed your IEP. Coverage starts July 1.

• Special Enrollment Periods (SEPs): Triggered by life events like retirement or losing employer coverage.

Failing to enroll during the right window can result in lifetime penalties or delayed coverage.

Getting Help Makes a Difference

Medicare is a complex system, and no one expects you to master every detail. However, taking the time to understand what’s not covered—and when you may be at risk of high out-of-pocket expenses—can help you make smarter decisions.

You don’t have to figure it all out alone. Getting support from a licensed agent can ensure you’re making choices that match your healthcare needs and financial situation.

Your Medicare Coverage Isn’t Automatic or Complete

Assuming Medicare covers everything is a mistake that can cost you more than you expect. From long-term care to prescription drugs and travel, the gaps in coverage are real and require action on your part. Don’t wait until a surprise bill arrives to learn about your responsibilities.

Take time every year to review your coverage, understand your costs, and make informed decisions.

To get tailored guidance and avoid costly mistakes, speak with a licensed agent listed on this website who can help you assess your current needs and explore the right solutions for your situation.