How does Medicare work?

Medicare is run by the federal government and covers most Americans once they turn 65. It is divided into parts, and each part covers something different.Part A covers inpatient hospital care, skilled nursing facility stays, hospice, and some home health services. Most people do not pay a monthly premium for Part A if they or their spouse worked and paid Medicare taxes for at least 10 years.Part B covers doctor visits, outpatient care, preventive services, and medical equipment. Part B does have a monthly premium, and the amount can vary based on your income.Part D covers prescription drugs. It is offered through private insurance companies approved by Medicare, and premiums and covered medications vary by plan.There is also Part C, better known as Medicare Advantage, which lets you get all of your Medicare benefits bundled through a private insurer instead of through Original Medicare directly.Original Medicare (Parts A and B) covers a lot, but it does not cover everything, and it has no out-of-pocket maximum. That is why many people add either a Medigap supplement policy to cover cost-sharing gaps, or choose a Medicare Advantage plan that caps what they could owe in a year.Plan details and costs change annually, so it is worth reviewing your coverage each year.