How the four kinds of Medicare coverage fit together

Ask yourself whether you would rather have a predictable premium or predictable copays. Government Medicare with a supplement costs more every month and answers most billing questions in advance. Medicare Advantage costs less every month and asks you to work within a network, a deductible and a set of approvals.

Neither answer is wrong. It depends on travel, on how many specialists you see, and on how much uncertainty your budget can absorb.

Part A pays for inpatient admissions, skilled nursing after a qualifying stay, hospice, and some home health visits. The 2026 deductible is $1,736 each benefit period, and most households pay no monthly charge for it. Part B pays for appointments, outpatient care, labs, equipment and prevention, at $202.90 a month with a $283 deductible.

Its honest weak point is the 20 percent share on Part B services with no annual ceiling. In a quiet year that is manageable. In a surgical year it becomes the biggest number on the kitchen table, which is why nearly everyone pairs it with something.

Advantage plans are private insurers operating under federal contract, and they deliver your A and B benefits. Most bundle drug coverage, and many add dental, vision, hearing, gym memberships or an over-the-counter allowance. The trade is that the plan’s network and rules apply to your care.

Four structures appear in the marketplace. Health maintenance organizations keep premiums lean but want in-network care and often a referral. Preferred provider organizations let you step outside the network at a higher cost and rarely require referrals. Private fee-for-service plans carry no fixed network but exist in fewer areas. Special needs plans serve people with particular chronic conditions, people who also hold Medicaid, or people living in institutional settings.

A Medigap policy is not Medicare and does not stand in for it. It reimburses part of the deductibles and coinsurance that government Medicare leaves you. Federal rules standardize benefits by letter, so a Plan G must deliver identical coverage regardless of the carrier. You are shopping on price and rate history, not on benefits.

Access is the catch. During the six months starting when Part B begins at 65 or later, an insurer cannot decline you or surcharge a medical condition. After that most states permit underwriting, and that single rule is why supplement decisions are so carefully timed.

Drug coverage arrives either as a stand-alone policy beside government Medicare or folded inside an Advantage plan. Every plan publishes a formulary, assigns tiers to drugs, and may impose prior authorization or step therapy. For 2026 the maximum deductible is $615 and out-of-pocket spending on covered drugs stops at $2,100 for the year.

Choosing on premium alone is where most people go wrong. A $12 plan can cost far more across twelve months than a $45 plan if your inhaler sits on a specialty tier.

If you travel, keep a place in two states, or see specialists scattered across a metro, government Medicare with a Medigap policy is hard to beat for peace of mind. If premium matters most and your doctors are local, an Advantage plan can be excellent value, and plenty of people genuinely prefer the extras.

There is no universal right answer, which is why we ask about physicians, prescriptions and travel before quoting anything. Our comparison page goes deeper on the two paths.