Thinking About Retirement? Here's What to Know About Medicare

July 23, 2026
Sonya Wright

While full retirement age for Social Security approaches age 67, Medicare benefits are available at age 65.

The Initial Enrollment Period for Medicare is the 3 months before and 3 months after the month in which you turn 65. If you miss this enrollment window, you may be subject to premium penalties for the rest of your life.

Medicare benefits begin the first day of the month in which you turn 65 if enrollment was completed before that date.

If you turn 65 but are still covered by an employer plan (your own or your spouse’s), enrollment can be delayed until 8 months of the day upon which the individual or spouse stopped working. Coverage would then begin the month after you sign up. No penalties apply in this situation.

If you miss both of these enrollment periods, general enrollment is held between January 1 and March 31 each year. Coverage begins the month after sign up. If you enroll this way, you would pay a higher premium for the rest of your life (10% higher for every year enrollment was delayed).

The Alphabet Soup of Medicare

Medicare consists of four parts, creatively named A, B, C, and D. At first it seems pretty straightforward:

Part A has no premium cost and covers inpatient hospital care, skilled nursing facility care, hospice care, and home health care.

Part B has a premium cost ($202.90 per month in 2026 depending on your income – more on that below) and covers doctors, outpatient care, home health care (yes, that’s mentioned twice for a reason), durable medical equipment, and preventive services.

Part D (yes, we’re skipping C for a minute) covers prescription drug coverage including recommended shots and vaccines. The premium for Part D varies by insurance company.

If your income is above $109,000 (single) or $218,000 (joint), you’ll have extra costs for your Part B and D premiums. This is called an “Income Related Monthly Adjustment Amount” (IRMAA). Your 2026 IRMAA is based on the modified Adjusted Gross Income you reported on your 2024 tax return. See this publication for more information.

Then it gets confusing . . . .

Medigap

The structure described above of Parts A+B+D is called “original Medicare”. If you enroll in this arrangement, you’ll probably also want to enroll in supplemental coverage, sometimes called Medigap. This covers medical costs not covered by original Medicare, and comes with an additional premium.

Medigap plans have their own set of alphabet soup ranging from A though N. Perhaps they could have considered using numbers or some other designation than letters in order to be less confusing, but here we are. Each Medigap plan A through N covers different things and has different premium amounts. However, no matter which insurance company provides Medigap coverage, the coverage at each plan level remains the same. More information about Medigap is available from the Medicare website by clicking here.

And then there’s Medicare Part C, AKA Medicare Advantage

Did you think we forgot Part C? Medicare Advantage plans replace Original Medicare coverage.

Medicare Advantage plans are sold by private insurance companies, and bundle parts A, B, and usually D into a single plan. Many plans offer supplemental benefits that Original Medicare doesn’t cover, such as routine dental, vision, hearing, and gym memberships. All plans have an annual out-of-pocket maximum, which protects you from unlimited medical bills. However, you generally must use doctors and hospitals within the plan’s specific HMO or PPO network. Seeing out-of-network providers or specialists may not be covered. You often need to get permission or prior authorization from the plan before certain tests, drugs, or procedures are covered.

Which Arrangement Should I Choose?

It depends on your personal situation, your health, and your budget. If you travel frequently, want access to specialized care without network limitations, and can comfortably afford the premiums for a Medigap policy, Original Medicare might be for you. If you’re looking for a lower monthly premium, want prescription drugs bundled in, and desire extra benefits like dental and vision, Medicare Advantage might be a good choice as long as you’re comfortable using a specific network of doctors.

Medicare Advantage has undergone some changes in 2026 because of insurance companies exiting certain markets. The maximum allowable limit for in-network services has been reduced to $9,250 from $9,350 in 2025. In order to maintain profit margins, some plans have reduced extra benefits.

Can I Switch Between Original Medicare and Medicare Advantage?

You can switch between plans during the annual election period (October 15 – December 7 each year). There is also a Medicare Advantage enrollment period January 1 – March 31 each year.

In switching from Medicare Advantage to Original Medicare, be aware that since Medigap coverage is through private insurance companies, you generally must pass a health screening in order to be accepted.