What Do the Parts of Medicare Actually Cover?

Medicare's letters are the first hurdle. Parts A, B, C, and D are not four tiers of one plan — they are four different pieces of coverage, obtained in different ways, and a person's actual coverage is a combination of them. Here is what each letter means, in the order the system was built.

Part A: hospital insurance

Part A covers inpatient care: hospital stays, skilled nursing facility care after a qualifying hospital stay, hospice, and some home health care. Most people don't pay a monthly premium for Part A, because they (or a spouse) paid Medicare taxes during their working years. That's why you'll hear it called "premium-free Part A." The official primer at Medicare.gov covers who qualifies automatically and who needs to sign up.

Part B: medical insurance

Part B covers the outpatient side: doctor visits, lab work, preventive services, outpatient procedures, and durable medical equipment like walkers or home oxygen gear. Unlike Part A, nearly everyone pays a monthly premium for Part B, and people above certain income levels pay more. Parts A and B together are called Original Medicare — the traditional, government-run program where you can generally see any provider that accepts Medicare.

Part C: Medicare Advantage

Part C is not extra coverage on top of A and B — it's a different delivery method for them. A Medicare Advantage plan is offered by a private insurer approved by Medicare. It must cover everything Parts A and B cover, usually includes drug coverage, and often adds extras such as dental or vision benefits. In exchange, you typically use the plan's provider network and follow its rules, such as referrals or prior authorization. A large share of beneficiaries now get their Medicare this way; the nonprofit KFF publishes ongoing independent research on how Medicare Advantage enrollment and plan design have evolved.

Part D: prescription drug coverage

Part D covers outpatient prescription drugs. It is always delivered by private plans, in one of two ways: a stand-alone drug plan added to Original Medicare, or drug coverage built into a Medicare Advantage plan. Each plan has its own formulary (covered-drug list), tiers, and pharmacy network, which is why two Part D plans can treat the same prescription very differently.

Medigap: the supplement, not a part

Medigap — formally Medicare Supplement Insurance — is not a lettered part of Medicare, though confusingly its standardized plans also use letters. A Medigap policy is private insurance that helps pay the out-of-pocket costs Original Medicare leaves behind, such as coinsurance and deductibles. Two rules keep people oriented: Medigap works only with Original Medicare, never with Medicare Advantage, and each lettered Medigap plan's benefits are standardized by law even though prices vary by insurer.

How the pieces combine

In practice, most people end up on one of two paths: Original Medicare (A + B), often with a stand-alone Part D plan and sometimes a Medigap policy; or a Medicare Advantage plan (Part C) that bundles A, B, and usually D together. The comparison table on our home page lays these pieces out side by side. Which path suits a given person depends on their providers, prescriptions, budget, and travel habits — that's a conversation for a free SHIP counselor or a licensed professional, and it goes much better when the vocabulary above is already familiar.