Parts A, B, C and D in plain English
Part A is hospital insurance. It covers inpatient stays, skilled nursing facility care after a qualifying hospital stay, hospice and some home health care. It is premium-free if you or your spouse worked 40 quarters in covered employment, which is about 99% of beneficiaries. In 2026 you pay a $1,736 deductible per benefit period, then $434 a day for hospital days 61 to 90, $868 a day for lifetime reserve days, and $217 a day for skilled nursing days 21 to 100.
Part B is medical insurance. Doctor visits, outpatient care, labs, imaging, durable medical equipment and preventive services. The standard 2026 premium is $202.90 a month with a $283 annual deductible, after which Medicare generally pays 80% of the approved amount and you pay the remaining 20% with no cap. That uncapped 20% is the central reason people buy either Medigap or an Advantage plan.
Part C is Medicare Advantage. A private plan that replaces how you receive Parts A and B, almost always bundles Part D, and usually adds dental, vision, hearing and fitness benefits. You still pay your Part B premium; the plan premium is often $0. In exchange, you use the plan's network and prior-authorization rules, and your annual in-network exposure is capped by a plan out-of-pocket maximum.
Part D is drug coverage, sold as a standalone plan alongside Original Medicare or built into an Advantage plan. In 2026 the maximum deductible is $615, you pay 25% coinsurance in the initial coverage phase, and once your out-of-pocket spending on covered drugs reaches $2,100 you enter catastrophic coverage and pay nothing more for covered Part D drugs that year, per Medicare.gov. Many plans also offer a payment plan that spreads your out-of-pocket drug costs across the year in level monthly amounts.
Medigap is not Part C. A Medigap, or Medicare Supplement, policy is standardized letter coverage that pays your share of Original Medicare costs. It does not include drug coverage, so Medigap buyers also need a standalone Part D plan. High-deductible versions of Plans F, G and J carry a $2,950 deductible in 2026 before the policy begins paying, per CMS.
IRMAA: what higher earners pay in 2026
IRMAA is a surcharge, not a different plan. Social Security looks at your modified adjusted gross income from two years earlier, 2024 for the 2026 plan year, and adds an amount to both your Part B premium and your Part D premium.
| 2024 MAGI, single | 2024 MAGI, joint | Part B total monthly | Part B surcharge |
|---|---|---|---|
| $109,000 or less | $218,000 or less | $202.90 | $0.00 |
| $109,001 to $137,000 | $218,001 to $274,000 | $284.10 | $81.20 |
| $137,001 to $171,000 | $274,001 to $342,000 | $405.80 | $202.90 |
| $171,001 to $205,000 | $342,001 to $410,000 | $527.50 | $324.60 |
| $205,001 to $499,999 | $410,001 to $749,999 | $649.20 | $446.30 |
| $500,000 or more | $750,000 or more | $689.90 | $487.00 |
Three practical notes. IRMAA is a cliff, not a phase-in, so one dollar over a threshold moves you to the full next tier and a 2024 Roth conversion can raise your 2026 premiums all year. A separate Part D IRMAA applies on top of your plan premium in the same brackets. And if your income dropped because of retirement, a spouse’s death, divorce or a lost pension, you can ask Social Security to recalculate using Form SSA-44. If you are planning withdrawals near a bracket edge, see our retirement income planning page.
Medicare Advantage or Medigap: an honest comparison
There is no universally correct answer. There is a correct answer for your health, your travel, your doctors and your tolerance for administrative friction.
| Question | Medicare Advantage | Original Medicare + Medigap |
|---|---|---|
| Monthly cost | Part B premium plus a plan premium that is frequently $0 | Part B premium plus a Medigap premium, commonly $120 to $300 depending on age, state and plan letter |
| Cost when you are sick | Copays and coinsurance until you hit the plan out-of-pocket maximum | Very little; Plan G leaves only the $283 Part B deductible in most cases |
| Provider access | Network based, usually HMO or PPO, with prior authorization for many services | Any provider in the country that accepts Medicare, no referrals |
| Drug coverage | Usually built in | Requires a separate Part D plan |
| Extra benefits | Often dental, vision, hearing, fitness and an over-the-counter allowance | None included; buy standalone dental and vision if you want it |
| Switching later | You can change plans each fall during open enrollment | Moving to Medigap later usually requires passing medical underwriting |
- Lean Advantage if your doctors are in-network, you are comfortable with prior authorization, you value bundled extras, and you want a low fixed premium with a capped worst case.
- Lean Medigap if you travel or split time between states, you see specialists at multiple health systems, you have a chronic condition, or you would rather pay a known premium than manage copays.
- Either way, price Part D separately. The cheapest Part D plan for someone on generics is rarely the cheapest for someone on a brand-name biologic.
The timing asymmetry is what to plan for. Advantage plans are guaranteed issue every fall during the annual election period; Medigap is only guaranteed issue during your six-month window when you first enroll in Part B, plus limited situations set by federal or state law. If there is any chance you will want Medigap eventually, the cheapest time to buy it is at the start. Our Advantage versus Medigap guide works through real profiles.
Deadlines, penalties and the windows that matter
Per Medicare.gov, your Initial Enrollment Period runs seven months: the three months before the month you turn 65, your birthday month, and the three months after. Sign up before your birthday month and coverage starts the month you turn 65; sign up during or after it and coverage starts the following month.
- Initial Enrollment Period. Seven months around your 65th birthday. This is when Medigap is also guaranteed issue, for six months from the start of your Part B coverage.
- General Enrollment Period. January 1 to March 31 each year, with coverage beginning the month after you sign up. This is the fallback if you missed your window and have no Special Enrollment Period, and a penalty usually applies.
- Special Enrollment Periods. Available when you had qualifying employer coverage, lost Medicaid, were affected by a declared disaster, or in several other defined situations. These let you enroll without a late penalty.
- Annual Election Period. October 15 to December 7 to change Advantage and Part D plans for January 1.
- Medicare Advantage Open Enrollment. January 1 to March 31 for people already in an Advantage plan to switch once or return to Original Medicare.
The penalties are permanent and worth avoiding. Part B adds 10% for each full 12-month period you could have enrolled and did not, and it stays on your premium for life. The Part D penalty is 1% of the national base beneficiary premium, $38.99 in 2026, multiplied by the number of full months you went without creditable drug coverage, rounded to the nearest ten cents and added to your monthly premium. Waiting 14 months means a 14% surcharge, indefinitely.
Two situations confuse people. Still working past 65 at an employer with 20 or more employees? You can usually delay Part B without penalty, but confirm the coverage is creditable in writing. And HSA contributions must stop before Medicare begins, because Part A enrollment can be retroactive up to six months. Our enrollment guide covers both.
Sources & further reading
- CMS — 2026 Medicare Parts A and B premiums and deductibles fact sheet
- CMS — Final CY 2026 Part D redesign program instructions
- Medicare.gov — How much does Medicare drug coverage cost?
- Medicare.gov — When does Medicare coverage start?
- CMS — Medigap Plan F, G and J high-deductible announcement for 2026
- CMS — 2026 Medicare Advantage and Part D landscape state-by-state fact sheet
- Medicare.gov — Medicare & You 2026 handbook