Medicare has been around since 1965, but most people don’t think about it until they’re a few months away from turning 65 — and suddenly realize they have no idea how it works.
If that’s where you are right now, you’re in the right place. This guide breaks down exactly what Medicare is, what it covers, how the parts work together, and what decisions you’ll need to make before your coverage starts. If you’re in the Tampa Bay area — Pasco, Pinellas, Hernando, or Hillsborough County — some of those decisions will be more specific to your county than you might expect.
Let’s start from the beginning.
What Is Medicare?
Medicare is the federal health insurance program for Americans 65 and older, as well as certain younger people with disabilities or specific medical conditions. It was signed into law by President Lyndon B. Johnson in 1965 and has covered hundreds of millions of Americans since.
Here’s the part most people miss: Medicare isn’t free, and it isn’t automatic for everyone. You have to enroll, and how you enroll — and when — affects your coverage and your costs for the rest of your life.
What Are the Four Parts of Medicare?
Medicare has four parts — A, B, C, and D — and each one covers something different. Most people need more than one.
Part A — Hospital Insurance
Part A covers inpatient hospital stays, skilled nursing facility care, hospice, and some home health services. Most people don’t pay a premium for Part A if they or their spouse paid Medicare taxes for at least 10 years (40 quarters) while working. If you worked 30–39 quarters, your premium is $311/month. Fewer than 30 quarters, and it runs $565/month.
Part B — Medical Insurance
Part B covers doctor visits, outpatient services, preventive care, and medically necessary equipment. Unlike Part A, Part B has a monthly premium. In 2026, the standard premium is $202.90 per month — though higher earners pay more through what’s called IRMAA, which we’ll cover below. There’s also a $283 annual deductible. After that, you typically pay 20% of the Medicare-approved amount for covered services.
Part C — Medicare Advantage
Medicare Advantage is an alternative way to get your Medicare benefits through a private insurance company instead of the federal government. These plans must cover everything Original Medicare covers, but they often include extras like dental, vision, and hearing. The decision between Original Medicare and Medicare Advantage is one of the most important ones you’ll make — we cover it in depth in a separate post.
Part D — Prescription Drug Coverage
Part D covers prescription medications and is offered through private insurance companies approved by Medicare. If you don’t sign up when you’re first eligible and don’t have other creditable drug coverage, you could face a permanent late enrollment penalty that follows you for life.
How Do the Parts Work Together?
Think of it this way: Parts A and B are the foundation — this is what people mean when they say “Original Medicare.” From there, you have two roads.
Road 1: You stay with Original Medicare and add a Medicare Supplement plan (also called Medigap) to cover the gaps, plus a standalone Part D plan for prescriptions.
Road 2: You enroll in a Medicare Advantage plan (Part C), which bundles A, B, and usually D into one plan through a private insurer.
Both roads have real tradeoffs. Which one is right for you depends on your doctors, your medications, your budget, and where you live. In Florida, where you live matters more than most people realize — plan options and benefits vary significantly by county.
Who Qualifies for Medicare?
You qualify for Medicare if you meet one of the following:
- You’re 65 or older and a U.S. citizen or permanent legal resident who has lived in the U.S. for at least five continuous years
- You’re under 65 with a qualifying disability and have received Social Security Disability Insurance (SSDI) for 24 months
- You have End-Stage Renal Disease (ESRD) or ALS, regardless of age
Most people reading this fall into the first category — turning 65 and figuring out what comes next.
When Does Medicare Start?
Your Medicare eligibility begins the first day of the month you turn 65. If your birthday falls on the first of the month, your coverage actually starts the month before.
You have a 7-month Initial Enrollment Period — 3 months before your birthday month, your birthday month itself, and 3 months after. Signing up early matters. If you wait until after your birthday month, your coverage start date gets delayed and you could face gaps.
If you’re still working at 65 and covered under an employer plan, the rules are different. Whether you need to sign up for Medicare while you’re still working depends on the size of your employer. Getting this wrong is one of the most expensive Medicare mistakes people make — we cover it in detail in our post on Medicare enrollment periods.
What Does Medicare Cost in 2026?
This is where a lot of people get surprised. Medicare isn’t free — and understanding the costs upfront is the whole ballgame.
Part A Costs Most people pay $0 for Part A if they worked at least 10 years. If you did have to pay, premiums run $311–$565/month depending on your work history.
What catches people off guard with Part A is the deductible. It’s not an annual deductible — it’s per benefit period. A benefit period starts the day you’re admitted to the hospital and ends after you’ve been out of inpatient care for 60 consecutive days. The deductible in 2026 is $1,736 — and if you have multiple hospital stays in a year with gaps of more than 60 days between them, you could owe that deductible more than once.
Hospital coinsurance kicks in after day 60: $434/day for days 61–90, and $868/day for lifetime reserve days (91–150). For skilled nursing facility stays, days 1–20 are covered at $0, and days 21–100 run $217/day.
Here’s the critical part: Original Medicare has no maximum out-of-pocket limit. There is no ceiling on what you could owe in a bad year. That’s not a typo — it’s one of the biggest gaps in Original Medicare and one of the main reasons most people add additional coverage.
Part B Costs The standard Part B premium in 2026 is $202.90/month. The annual deductible is $283. After that, you typically pay 20% of the Medicare-approved amount for covered services — with no cap on what that 20% could add up to.
Like Part A, Part B has no maximum out-of-pocket limit either.
What About Higher Earners? (IRMAA) If your modified adjusted gross income (MAGI) from two years ago exceeded certain thresholds, you’ll pay more for both Part B and Part D. This is called IRMAA — Income-Related Monthly Adjustment Amount. For 2026, IRMAA kicks in at $109,000 for individuals and $218,000 for married couples filing jointly. Part B premiums for higher earners range from $284.10 up to $689.90/month. Your 2024 tax return is what CMS uses to determine your 2026 IRMAA.
What Does Medicare Not Cover?
Original Medicare covers a lot — but the gaps are real. Understanding them upfront saves you from a nasty surprise later.
Medicare does not cover:
- Routine dental care
- Vision exams and eyeglasses
- Hearing aids
- Long-term custodial care (nursing home care that isn’t skilled care)
- Most care received outside the United States
These gaps — combined with the fact that there’s no out-of-pocket maximum — are exactly why most people add either a Medigap plan or a Medicare Advantage plan on top of Original Medicare.
Medigap vs. Medicare Advantage — Which Road Is Right for You?
We cover this in depth in its own post, but here’s the short version.
Medigap (Medicare Supplement) plans work alongside Original Medicare. You keep your Medicare and the Medigap plan picks up costs Medicare doesn’t cover — like that 20% coinsurance and the Part A deductible. You pay a monthly premium for the Medigap plan, but your exposure to big unexpected bills shrinks dramatically. Plan G is the most popular comprehensive option available to people new to Medicare today.
Medicare Advantage plans replace Original Medicare. You still have Medicare, but your benefits are administered through a private insurance company. Many plans have $0 premium (you still pay Part B), and they often add benefits like dental, vision, and hearing that Original Medicare doesn’t cover. The tradeoff is that you’re working within a network and you’ll have copays and cost-sharing when you use services.
Which one is better? It genuinely depends — on your health, your doctors, your county, and your budget. This is the conversation we have with every client at Capstone Health.
Working With a Medicare Agent — What You Should Know
Medicare is complicated. The rules change every year, the plan options in your county change every year, and the decision you make at 65 follows you for a long time.
A good independent Medicare agent represents multiple carriers, shops the market on your behalf, and helps you make the right decision for your specific situation — your doctors, your medications, your budget. There’s no extra cost to you. Agents are compensated by the insurance companies, not by you.
The key word is independent. A captive agent works for one company and can only show you that company’s plans. An independent agent — like our team at Capstone Health in New Port Richey — works across carriers so you see the full picture, not just what one company wants to sell you.
If you’re in Pasco, Pinellas, Hernando, or Hillsborough County, we’d be glad to help. You can book a no-cost appointment directly on our site or here.
Frequently Asked Questions
What is Medicare in simple terms? Medicare is the federal health insurance program for Americans 65 and older. It’s made up of four parts — A, B, C, and D — that cover hospital care, doctor visits, prescription drugs, and optional extra benefits depending on the plan you choose.
Is Medicare free when you turn 65? Not entirely. Most people pay $0 for Part A if they worked and paid Medicare taxes for at least 10 years. Part B has a standard premium of $202.90/month in 2026, plus a $283 annual deductible. Higher earners pay more through IRMAA surcharges based on their income from two years prior.
Does Medicare have a maximum out-of-pocket limit? No — and this surprises most people. Original Medicare has no out-of-pocket maximum for either Part A or Part B. There’s no ceiling on what you could owe in a serious illness year. This is one of the most important reasons people add a Medigap plan or Medicare Advantage plan on top of Original Medicare.
What’s the difference between Medicare and Medicaid? Medicare is a federal program based on age or disability — most people qualify at 65 regardless of income. Medicaid is a state and federal program based on income. Some people qualify for both, which is called being “dual eligible,” and those individuals often have access to special plans with significantly enhanced benefits.
When should I sign up for Medicare? Your Initial Enrollment Period is a 7-month window around your 65th birthday. Signing up during the three months before your birthday month gives you the earliest possible start date. If you miss your window without qualifying for a Special Enrollment Period, you could face permanent late penalties and coverage gaps.
Do I need Medicare if I’m still working at 65? It depends on the size of your employer. If your employer has fewer than 20 employees, Medicare becomes your primary coverage at 65 and you need to enroll. If your employer has 20 or more employees, your employer coverage stays primary and you have more flexibility. Getting this wrong can be costly — talk to a licensed Medicare agent before you decide.
Last updated: April 2026 | Capstone Health serves Medicare beneficiaries throughout the Tampa Bay area including Pasco, Pinellas, Hernando, and Hillsborough Counties. Questions? [Book a free appointment here.]