The table worth printing
| Part | What it is | What it covers | 2026 cost snapshot |
|---|---|---|---|
| Part A Hospital | Federal, automatic for most at 65 | Inpatient hospital, skilled nursing after a qualifying stay, hospice, some home health | $0 premium for most; $1,736 deductible per benefit period |
| Part B Medical | Federal, optional but penalized if skipped without other coverage | Doctors, outpatient care, labs, imaging, preventive care, equipment | $202.90/mo premium; $283 deductible, then 20% with no cap |
| Part C Medicare Advantage | Private plans replacing how A and B are delivered | Everything A and B cover, usually plus drugs, dental, vision, hearing | Premiums from $0; copays per service; yearly out-of-pocket max |
| Part D Drug coverage | Private, stand-alone or built into Part C | Outpatient prescriptions by formulary tiers | Base avg about $34.50/mo; $615 max deductible; $2,100 yearly cap |
How the parts combine in real life
Nobody shops the parts individually. In practice you assemble one of two stacks:
- Stack one: A + B + Medigap + D. Original Medicare stays primary, a Supplement mops up the deductibles and the 20 percent, and a Part D plan handles the pharmacy.
- Stack two: A + B delivered through C. One Advantage plan carries your medical and usually your drug coverage, with network rules and an out-of-pocket maximum.
That is the entire decision space. Every acronym you will ever hear fits inside one of those two stacks.
Three confusions this lesson retires
- Part C is not supplemental. It replaces how A and B are delivered; a Medigap plan cannot be used with it.
- Part A being free does not make Medicare free. Part B has a real premium ($202.90 in 2026), and higher incomes pay more through IRMAA, covered in Lesson 4.
- Skipping Part D because you take no medications usually backfires: the late enrollment penalty is permanent, and a low-premium plan today is cheap insurance against it.
Professor's note
If you remember one sentence from this lesson: A is the building, B is the people, D is the pharmacy, and C is a private company running all three under one roof. Everything else is footnotes.