What is original Medicare and how does it work?


Editorial team Published on

Original Medicare is the federal government’s fee-for-service health insurance program for adults aged 65 and older, as well as certain younger people with disabilities.

It consists of two main parts:

  • Part A (Hospital Insurance): Helps pay for inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care.
  • Part B (Medical Insurance): Helps pay for doctor visits, outpatient care, medical equipment, and preventive services.

💡 How It Works

  • Fee-for-service: The government pays the doctor or hospital directly for each individual service or item you receive.
  • Nationwide access: You can go to any doctor, hospital, or specialist in the U.S. that accepts Medicare, and you never need a referral.
  • No prior approval: You generally do not need prior authorization from the government before getting tests or treatments.
  • Cost sharing: You pay monthly premiums for Part B, plus deductibles and coinsurance (typically 20% of the Medicare-approved amount for Part B services).
  • No spending cap: Original Medicare does not have an annual limit on out-of-pocket costs.
  • Gaps in coverage: It does not cover routine dental, vision, hearing care, or most prescription drugs.

To manage out-of-pocket costs and add drug coverage, many people buy private supplemental insurance like Medigap and a standalone Part D prescription drug plan.