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Part A is hospital insurance covering inpatient care, skilled nursing, and home health services, while Part B is medical insurance covering outpatient doctor visits, tests, and preventive care.
Part A has a per-stay deductible with free coverage for the first 60 days, while Part B requires a monthly premium and annual deductible with 20 percent coinsurance after the deductible is met.
Enrollment in both parts at age 65 is essential to avoid permanent premium penalties that increase your costs for life.
When you turn 65, you become eligible for Medicare. But Medicare isn't one insurance plan. Instead, it breaks into different parts, each covering different kinds of care. The names can feel confusing, with Part A covering hospital care and Part B covering medical care. But what does that really mean? And when you're facing a hospital stay or doctor visit, which part actually pays?
This article walks you through the differences between Medicare Part A and Part B, explains what each covers, and shows you what you pay out of your pocket. Understanding these two parts is essential for managing your retirement healthcare costs.
What Is Medicare Part A?
Medicare Part A is sometimes called hospital insurance, and that name is mostly accurate, though Part A covers more than just traditional hospital stays. It covers care in facilities and settings where you stay overnight and receive skilled medical care.
Medicare Part A coverage includes:
Inpatient hospital care including your room, meals, nursing care, medications while you are a patient, and basic medical supplies like bandages and catheters
Skilled nursing care after a hospital stay, up to 100 days per benefit period in certain situations when you need actual medical care from a nurse (not just help with daily activities)
Inpatient rehabilitation facilities that focus on helping you regain function after an injury, stroke, or surgery
Home health services under specific conditions: you must be homebound, need skilled care like nursing or physical therapy, and have your doctor order the services
Hospice care for terminal illnesses, including pain management, symptom control, and comfort care in your home or a hospice facility
What Is Medicare Part B?
Medicare Part B is medical insurance that covers outpatient care, meaning care you receive without staying overnight in a hospital facility. It complements Part A by covering doctor visits, tests, and procedures performed outside of inpatient settings.
Medicare Part B coverage includes:
Doctor visits with your regular physician or a specialist for office visits, checkups, treatment of chronic conditions, and consultations
Outpatient hospital services such as emergency room visits and procedures done at outpatient surgery centers
Diagnostic services and supplies including blood tests, X-rays, EKGs, diabetic testing strips, and glucose monitors
Durable medical equipment (DME) such as walkers, wheelchairs, oxygen tanks, and hospital beds for home use
Outpatient mental health services including therapy, counseling, and psychiatric visits provided outside of a hospital setting
Home health aide services (though Part A is the primary payer for skilled nursing in the home)
Preventive services at no copay or coinsurance, including annual wellness visits, cancer screenings, diabetes screenings, and vaccinations
The Key Difference: Inpatient vs. Outpatient
The clearest way to understand the difference between Part A and Part B is to think about whether you are staying overnight in a hospital or facility.
If you check into a hospital and spend the night, Part A is your primary coverage. If you have a doctor visit at an office, a procedure at an ambulatory surgery center, or an emergency room visit where you go home the same day, Part B is your primary coverage.
This distinction matters because the two parts have different deductibles, different copays, and different limits on what they cover. You need both parts. They are designed to work together.
What You Pay: Part A and Part B Costs in 2026
Part A costs include several components that vary based on your usage:
The premium is free for 99 percent of beneficiaries who have worked 40 quarters covered by Medicare.
The deductible is a per-stay deductible that resets after 60 days out of the hospital rather than annually.
Hospital costs are free for days 1 through 60, with coinsurance required for days 61 through 90, and $868 per day charged for lifetime reserve days.
Skilled nursing care is free for days 1 through 20 after a qualifying hospital stay, then $217 per day for days 21 through 100.
Part B costs include different components that you'll encounter regularly:
A standard monthly premium is required even if you don't use any services during that month.
An annual deductible applies to most services before coverage begins.
Coinsurance typically amounts to 20 percent of the cost after your deductible is met.
Preventive services have no deductible or coinsurance for annual wellness visits, cancer screenings, and vaccinations.
Key enrollment requirement: Enroll in both parts to avoid permanent premium penalties.
Important Points About Part A and Part B Together
You should enroll in both Part A and B when you turn 65 to ensure comprehensive coverage. If you delay enrollment in Part B without a good reason, you may face a permanent penalty that increases your premium for the rest of your life. This penalty is significant and never goes away, which is why enrollment timing matters.
Some people think they can skip Part B if they have employer coverage through a working spouse. This is not always safe or allowed by Medicare rules. If you have employer coverage and you delay Part B enrollment, you should make sure you understand the specific rules that apply to your situation. A few scenarios do allow penalty-free late enrollment in Part B if you're receiving healthcare through employer coverage.
The two parts work together as an integrated system to provide comprehensive coverage. Part A covers your hospital stay while Part B covers the doctor's visit during that same stay. Part A covers the facility where you stay while Part B covers the physician who works at that facility. You need both parts to have comprehensive hospital and medical coverage.
Your costs will vary significantly based on where you go and what care you actually need. A hospital stay is typically much more expensive than a doctor visit, so you will likely spend more money out of pocket with Part A than with Part B. Conversely, a chronic illness that requires many doctor visits might shift your out-of-pocket costs toward Part B expenses.
What Part A and Part B Do Not Cover
Dental care, vision care, and hearing care are not covered by Original Medicare. You may want to look into separate supplemental coverage for these services. Custodial care and long-term care are also excluded. If you need help with activities like bathing, dressing, and eating but not medical care, Part A and Part B do not cover this. Long-term care insurance and Medicaid are options to explore if you anticipate needing this type of assistance.
Most routine foot care, acupuncture, and experimental treatments remain uncovered, though some of these services may be covered in specific situations. It's worth asking your provider whether Medicare will cover your particular treatment. Foreign travel is also not covered by Part A or Part B. If you spend significant time outside the United States, you may want to consider travel medical insurance.
Should You Enroll Right at 65?
Yes, most people should enroll in both Part A and Part B as soon as they are eligible at age 65. The Medicare program provides a seven-month Initial Enrollment Period to help you get coverage. This period includes the month you turn 65, plus the three months before you turn 65 and the three months after you turn 65.
If you sign up for Medicare during your Initial Enrollment Period, coverage can begin as early as the month you turn 65, ensuring you have no gap in healthcare protection. If you sign up after your Initial Enrollment Period ends, your coverage will be delayed until a future date, and you may owe a permanent late enrollment penalty that increases your premiums for the rest of your life.
The exception to immediate enrollment exists if you have employer coverage through your own job or your spouse's job. In this case, you can delay Part B enrollment without penalty as long as you enroll within eight months of losing your employer coverage or retiring from that job. However, this exception is narrowly defined and requires documentation.
You should absolutely not delay Part A enrollment. Part A has no premium for most people who have worked, and there is no financial reason to delay signing up. Enrolling immediately at 65 protects you from coverage gaps and penalties.
Part A and B Premiums Are Rising
Medicare costs are increasing each year. According to CMS program information, the Part B premium increased by $17.90 from 2025 to 2026. Part A costs are also increasing. If you fall into the category of people who pay a Part A premium, expect to pay $311 or $565 per month in 2026, depending on your work history.
These increases are due to rising healthcare costs and changes in the Medicare Trust Fund. As more people become eligible for Medicare and medical costs rise, the program adjusts its costs to remain solvent.
Part A and B Work Better With a Supplement or Advantage Plan
While Part A and Part B provide broad coverage of many healthcare services, they do not cover everything that you might need. You have two main options for obtaining additional coverage to fill the gaps that Original Medicare leaves.
A Medigap policy, also called supplemental insurance, fills in some of the gaps that Part A and Part B leave uncovered. These policies help pay for deductibles, coinsurance, copayments, and other out-of-pocket costs that you would otherwise bear yourself. If you want to keep your current doctors and maintain freedom of choice, and if you prefer more predictable costs that don't vary with healthcare usage, Medigap may be a good fit for your situation.
A Medicare Advantage plan bundles Parts A, B, and often Part D (prescription coverage) into one comprehensive plan. These plans often have lower monthly premiums compared to Original Medicare plus Medigap, but they typically have higher out-of-pocket costs when you use care. You must see doctors who participate in the plan's network unless you have a medical emergency, which can limit your provider choices.
Getting the Most From Your Coverage
To effectively manage your healthcare costs, you should know your deductible and coinsurance amounts for both parts. These amounts change each year, so reviewing your coverage annually is wise. If you are planning a hospital stay, ask your hospital billing department for a detailed estimate of what you will owe based on your specific diagnosis and expected length of stay.
If you need a test or procedure, ask your provider whether Medicare will cover it before you have it done. Some treatments are covered only in certain situations or only when ordered by your doctor for specific reasons. Knowing whether coverage applies before you go can prevent a surprise bill and help you make informed decisions about your care.
Keep your Medicare card with you at all times. Show it at every doctor visit and hospital visit you make. Your providers use this information to bill Medicare correctly and to verify your coverage. Without your card information, billing delays and errors can occur.
Consider whether supplemental coverage makes sense for your specific situation and healthcare needs. If you have high healthcare costs or visit doctors frequently due to chronic conditions, supplemental coverage might save you money in the long run compared to paying out-of-pocket costs. Calculate the annual premium plus your expected out-of-pocket costs to see which approach costs less.
Making Informed Decisions About Your Coverage
The distinction between Part A and Part B matters most when you're evaluating supplemental coverage, comparing Medicare Advantage plans, or deciding whether to delay enrollment. Knowing which part covers which service helps you anticipate your costs and choose the right additional coverage for your situation.
Frequently Asked Questions
Do I automatically get Part A and Part B?
You must sign up for Medicare to activate your coverage. If you are receiving Social Security benefits at age 65, you are usually enrolled automatically in Parts A and B. If you are not receiving Social Security, you must apply for Medicare through your local Social Security office, or at Medicare.gov.
Can I have Part A without Part B?
Technically, yes. But it is not recommended. You would have hospital coverage but no coverage for doctor visits or outpatient care. This leaves large gaps in your coverage. Most people should enroll in both.
What is the difference between Medicare Part A and long-term care insurance?
Part A covers acute medical care in a hospital or skilled nursing facility for a limited time (usually up to 100 days in a nursing home per benefit period). Long-term care insurance covers custodial care and extended stays in a nursing home or assisted living facility. These are two different products for two different needs.
Will my Part B premium increase if I delay enrollment?
Yes. If you delay Part B enrollment beyond your Initial Enrollment Period without qualifying for a special circumstance exception, you will pay a late enrollment penalty. This penalty is 10 percent of the standard premium for each full year you were eligible but did not enroll. The penalty is permanent and increases your premium for life.
Is preventive care really free under Part B?
Yes. Covered preventive services such as annual wellness visits, mammograms, colonoscopies, and vaccinations have no deductible and no coinsurance. However, if your doctor finds a problem during a preventive visit, the visit to address that problem may have a deductible and coinsurance.
What happens if I go to an out-of-network hospital in an emergency?
Medicare Part A covers emergency hospital care even if the hospital is not in your network and does not accept Medicare. However, Part B coverage for the doctors at that hospital may vary. Ask your provider's billing department whether Medicare will cover your specific situation.
Can Part A cover a hospital stay longer than 90 days?
Yes, but only using your lifetime reserve days. You have 60 lifetime reserve days you can use throughout your retirement. Once you use them, they are gone. Days after your lifetime reserve days are exhausted are not covered by Part A, and you must pay the full cost.
Do I pay the Part A deductible every time I go to the hospital?
You pay the deductible per benefit period, not per hospital visit. A benefit period ends 60 days after you leave the hospital. If you are readmitted to the hospital in a new benefit period, you pay the deductible again. However, if you are readmitted within 60 days of your previous discharge, the deductible applies only once.
Are prescriptions covered under Part A or Part B?
Neither Part A nor Part B covers most outpatient prescriptions. Prescription drug coverage is called Part D and must be added separately. Part A does cover prescription medications you receive as an inpatient in a hospital or nursing facility.
What should I do if I receive a bill from Medicare that seems wrong?
You have the right to appeal. Call Medicare at 1-800-MEDICARE or log into your Medicare.gov account to review claims. Contact the healthcare provider first if you believe you were billed in error. If unresolved, file a formal appeal with Medicare.
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*This content is for informational purposes only and does not constitute financial, tax, or legal advice. Please consult a qualified professional regarding your individual circumstances.*