Fair Square Medicare Wordmark

Medicare 101

By Daniel Petkevich

May 20, 2020

How Medicare is a lot like putting on layers on a cold day.

In the same way that you put on layers before going outside on a cold day, you put on layers of health insurance when it comes to Medicare. And just like you wouldn’t put your coat on before your undershirt, there’s an order to these layers of health insurance.

Your First Layer: Part A

Your Second Layer: Part B

  • Covers - Out-Patient care and doctor’s charges in a hospital. Examples of Out-Patient care are a check-up, X-Ray, blood test, or a simple elective procedure. After meeting an annual deductible ($257 in 2025), Part B covers 80% of expenses, and you pay the remaining 20%.

  • Premium - If your individual tax return shows income of $106,000 (or $212,000 for a joint tax return), or less, your Part B premium is $185 per month in 2025. If your income is higher, your premium will be as well. You can find a chart of Part B premiums as they vary with income at

    www.medicare.gov

    .

  • Provided by - The federal government

  • When To Enroll - Three months before your 65th birthday up to three months after

  • How to Enroll - You’re automatically enrolled if you’re collecting Social Security. Otherwise go to www.medicare.gov or follow

    this link.

  • Employer Coverage & Delaying Enrollment - Because everyone pays Part B premium, more people consider delaying enrollment in it if they have sufficient coverage from their or their spouse’s employer. The employer’s HR staff will let you know if you can delay enrollment in Part B. If you delay enrolling in Part B and don’t have sufficient employer coverage, you will face financial penalties in the future. 

A Quick Pause Before Adding More Layers

Parts A and B together are referred to as “Original Medicare”, and while they satisfy the minimum medical coverage the government requires you to have, many folks find they have gaps in the following areas:

  • Part A Deductible - The Part A deductible resets once you’ve been out of the hospital for 60 days. So if you go to the hospital several times, each time 60 days since the last one, you’ll pay a $1,676 deductible each time. This could add up.

  • Part B Coinsurance - After you meet the Part B deductible, you pay 20% of Part B covered care. 20% of a large number can be a large number.

  • Excess Charges - Healthcare providers will occasionally charge more than Medicare will reimburse them. The difference is called an “excess charge”, and you pay for all of it.

  • Foreign Travel - Original Medicare doesn’t cover healthcare received abroad except for a few limited cases in Canada and Mexico.

Further, the government requires you to have Prescription Drug Coverage, also referred to as “Part D”. Time to put on some more layers.

More Layers: Medigap, Medicare Advantage, and Prescription Drug Coverage

If you’re fine with the coverage provided by Original Medicare (Parts A and B), you can purchase an additional Prescription Drug Plan from a private insurance carrier (Part D), and you will have met the minimum amount of health insurance the government requires you to carry.

If you want additional coverage to “fill the gaps” in Original Medicare, you have two options:

Medigap Plan (Medicare Supplement)

If you’ve ever heard of “Plan G” or “Plan F”, you’ve heard of Medigap plans. They pick up the bill after Original Medicare pays. So if you got a blood test that costs $100, Part B will cover $80, and if your Medigap plan covers Part B coinsurance, it’ll cover all or part of the remaining $20.

Medigap plans are defined by the government but offered by private carriers. This means that the benefits of Plan G offered by Humana and Cigna are the same. The premium, however, will likely be different. Medigap premium is paid in addition to Medicare Part B premium.

The different Medigap benefits are listed on

www.medicare.gov

. Though there are ten options, four or five can usually be ruled out because, surprisingly, they cost more than other Medigap options with more coverage. The Medigap plan with the most comprehensive coverage that’s currently available to new Medicare enrollees is Plan G.

Should you choose a Medigap plan, you also need to purchase a Prescription Drug Plan. I am happy to discuss which Medigap plan might be a good fit for you.

Medicare Advantage Plans

Unlike Medigap Plans, Medicare Advantage plans are entirely defined and run by private carriers. They typically have you pay a copayment (a flat fee) or coinsurance (a percent of the total costs) for In-Patient and Out-Patient care until your medical payments for the calendar year reach an “out-of-pocket maximum”, at which point the plan covers all your expenses. Out-of-pocket maximums depend on the plan and typically cost about as much as a used car.

Medicare Advantage plans are typically offered as HMOs or PPOs. In the HMO model, you can only see doctors in the HMO, and you must get a referral from your primary care physician to see a specialist. This is in contrast to Original Medicare or Medigap, which allow you to see any doctor who accepts Medicare.

In the PPO model, Medicare Advantage plans let you see out of network doctors, but provide less coverage when you do so. If you choose the Medicare Advantage route, be sure it covers your preferred healthcare providers.

Unlike Medigap plans, Medicare Advantage plans come bundled with prescription drug coverage, so there’s no need to purchase a separate Prescription Drug Plan. Be sure a Medicare Advantage plan covers your prescriptions before enrolling in it.

Choosing Between Medigap and Medicare Advantage

To compare any plans, you must consider their total cost for the year: their premium plus your share of the year’s expected healthcare bills.

Depending on the plans available in your zip code, a Medicare Advantage plan might make more sense than a Medigap plan, or vice versa. I can help you compare different plans in your area.

Fortunately, there is an “escape hatch” for folks who enroll in a Medicare Advantage plan and are unhappy. If you enroll in a Medicare Advantage plan when you turn 65, you may switch to a Medigap plan for any reason during the first year.

Next Steps

I hope I have been able to somewhat demystify the world of Medicare for you, and if you have any further questions about Medicare in general or about which specific Medigap or Medicare Advantage plans are the best fit for you, please call at 1 (888) 376-2028 or click "Get Started" below.

Recommended Articles

Cover image

2024 Cost of Living Adjustment

Nov 13, 2023

Cover image

Welcome to Fair Square's First Newsletter

Feb 28, 2023

scleral lenses

Does Medicare Cover Scleral Lenses?

Dec 5, 2022

Pre-Existing condition stock image

Can Medicare Advantage Plans Deny Coverage for Pre-Existing Conditions?

Mar 28, 2023

Fair Square

Is Displacement Affecting Your Medicare Coverage?

Oct 6, 2022

What is the ICEP?

What is the Medicare ICEP?

Apr 7, 2023

Senior woman having vision problems stock photo

Does Medicare Cover Macular Degeneration?

Nov 30, 2022

Cover image

How Can I Get a Replacement Medicare Card?

Aug 14, 2023

Unrecognizable doctor holding highlighted handrawn Kidneys in hands. Medical illustration, template, science mockup. stock photo

Does Medicare Cover Nexavar?

Nov 30, 2022

older man suffering from stomach pain due to IBS stock photo

Does Medicare Cover Xiafaxan?

Jan 19, 2023

senior man reaching to his ear with jumbled letters going into the ear stock image

Does Medicare Cover Hearing Aids?

Nov 9, 2022

Dames Point Bridge in Jacksonville, Florida stock image

13 Best Ways for Seniors to Stay Active in Jacksonville

Mar 3, 2023

Enroll in Social Security step-by-step with the help of Fair Square stock image

How to Enroll in Social Security

Apr 28, 2023

Senior woman smiling after vaccination stock photo

Does Medicare Cover Flu Shots?

Dec 9, 2022

bearded man holding his head in confusion looking at his laptop stock image

Why Is Medicare So Confusing?

Apr 19, 2023

Cover image

How Often Can I Change Medicare Plans?

May 5, 2023

Cover image

How Are Medicare Star Ratings Determined?

Sep 6, 2023

woman sitting up in bed experiencing back pain stock photo

Does Medicare Cover a Spinal Cord Stimulator?

Nov 19, 2022

More of our articles

13 Best Ways for Seniors to Stay Active in Columbus

13 Best Ways for Seniors to Stay Active in Indianapolis

14 Best Ways for Seniors to Stay Active in Washington, D.C.

14 Best Ways to Stay Active in Charlotte

2024 Fair Square Client Retention and Satisfaction Report

Building the Future of Senior Healthcare

Can I Choose Marketplace Coverage Instead of Medicare?

Can I Laminate My Medicare Card?

Comparing All Medigap Plans | Chart Updated for 2025

Do All Hospitals Accept Medicare Advantage Plans?

Do I Need Medicare If My Spouse Has Insurance?

Do I Need to Renew My Medicare?

Do Medicare Supplement Plans Cover Dental and Vision?

Do You Need Medigap if You're Eligible for Both Medicare and Medicaid?

Does Medicare Cover Air Purifiers?

Does Medicare Cover an FMT?

Does Medicare Cover Cataract Surgery?

Does Medicare Cover Chiropractic Visits?

Does Medicare Cover Cold Laser Therapy (CLT)?

Does Medicare Cover Compounded Medications?

Does Medicare Cover Disposable Underwear?

Does Medicare Cover Driving Evaluations?

Does Medicare Cover Exercise Physiology?

Does Medicare Cover Hoarding Cleanup?

Does Medicare cover Hyoscyamine?

Does Medicare Cover Incontinence Supplies?

Does Medicare Cover Inspire for Sleep Apnea?

Does Medicare Cover Light Therapy for Psoriasis?

Does Medicare Cover Linx Surgery?

Does Medicare Cover Nuedexta?

Does Medicare Cover Ofev?

Does Medicare Cover Physicals & Blood Work?

Does Medicare Cover Qutenza?

Does Medicare Cover RSV Vaccines?

Does Medicare Cover Service Animals?

Does Medicare Cover Shock Wave Therapy for Plantar Fasciitis?

Does Medicare Cover SI Joint Fusion?

Does Medicare Cover the Urolift Procedure?

Does Medicare Cover the WATCHMAN Procedure?

Does Medicare Cover Urodynamic Testing?

Does Medicare Have Limitations on Hospital Stays?

Does Medicare pay for Opdivo?

Does Your Medicare Plan Cover B12 Shots?

Estimating Prescription Drug Costs

Explaining the Different Enrollment Periods for Medicare

Fair Square Client Newsletter: AEP Edition

Finding the Best Dental Plans for Seniors

How Does Medicare Pay for Emergency Room Visits?

How is Medicare Changing in 2025?

How Medicare Costs Can Pile Up

How Much Does Medicare Part A Cost in 2025?

How Much Does Open Heart Surgery Cost with Medicare?

How Much Does Trelegy Cost with Medicare?

How to Apply for Medicare?

How to Choose a Medigap Plan

Is Emsella Covered by Medicare?

Medicare Deductibles Resetting in 2025

Medicare Explained

Medicare Supplement Plans for Low-Income Seniors

Plan G vs. Plan N

Saving Money with Alternative Pharmacies & Discount Programs

Should You Work With A Remote Medicare Agent?

Top 10 Physical Therapy Clinics in San Diego

What Are Medicare Part B Excess Charges?

What Is a Medicare Advantage POS Plan?

What is a Medicare Beneficiary Ombudsman?

What Is the Medicare Birthday Rule in Nevada?

What People Don't Realize About Medicare

What You Need to Know About Creditable Coverage

What's the Deal with Flex Cards?

What's the Difference Between HMO and PPO Plans?

When to Choose Medicare Advantage over Medicare Supplement

Your Medicare One-Stop-Shop

Your guide to Medicare Parts A & B, Medicare Advantage, and Medigap. 100% free.

Get the Fair Square Bulletin

Medicare savings tips, helpful guides, and more.

About

Medicare 101

Current Clients

Medicare Supplement Plans

Medicare Advantage Plans

Fair Square 2025

Terms of Use
Notice of Privacy Practices

Virgil Insurance Agency, LLC (DBA Fair Square Medicare) and www.fairsquaremedicare.com are privately owned and operated by Help Button Inc. Medicare supplement insurance plans are not connected with or endorsed by the U.S. government or the federal Medicare program. This is a solicitation of insurance. A licensed agent/producer may contact you. Medicare Supplement insurance is available to those age 65 and older enrolled in Medicare Parts A and B and, in some states, to those under age 65 eligible for Medicare due to disability or End-Stage Renal disease. Virgil Insurance Agency is a licensed and certified representative of Medicare Advantage HMO, HMO SNP, PPO, PPO SNP and PFFS organizations and stand-alone PDP prescription drug plans. Each of the organizations we represent has a Medicare contract. Enrollment in any plan depends on contract renewal. The plans we represent do not discriminate on the basis of race, color, national origin, age, disability, or sex. Plan availability varies by region and state. For a complete list of available plans please contact 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week or consult www.medicare.gov. © 2025 Help Button Inc

We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.

MULTIPLAN_FairSquareMedicare_01062022_M