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Medicare Parts A, B, C and D

Four letters, and almost nobody explains how they fit together. Here is the whole structure on one page, with what each part actually costs in 2026 — and where your lab work sits in it.

The mix-up worth clearing up: Part C is not a supplement

People routinely call Medicare Advantage “supplemental coverage.” It isn’t, and the difference matters more than almost anything else on this page.

• Part C (Medicare Advantage) replaces Original Medicare. You still pay your Part B premium, but a private insurer now runs your coverage. It generally comes with a provider network, and may require prior approval for some services. Many plans bundle drug coverage and extras.
• Medigap (supplemental insurance) sits alongside Original Medicare. It doesn’t replace anything. It pays some of what A and B leave you owing — deductibles and coinsurance. You keep Original Medicare, keep any doctor who accepts Medicare, and pay a separate monthly premium for the Medigap policy.

They are alternatives, not companions. You cannot have both — a Medigap policy cannot be used to fill gaps in a Medicare Advantage plan.

Medigap has a door that closes

This is the part that catches people, and it is worth knowing even if you are nowhere near deciding.

Your Medigap Open Enrollment Period is a 6-month window that starts, in Medicare’s words, on “the first day of the month you’re 65 or older and signed up for Part B.” Inside that window you can buy any Medigap policy sold in your state, regardless of your health.

After it, Medicare is blunt: “there’s no federal guarantee that an insurance company will sell you a Medigap policy. If you’re able to buy one, it may cost more due to past or present health problems.”

So the decision isn’t only about this year’s premiums. Deciding a Medigap policy isn’t worth it at 66 can mean not being able to buy one at 76, when it would be. That is a genuinely hard trade-off, and it is the kind of thing worth talking through with a counselor rather than a website — including this one.

What is a “benefit period”?

This phrase does a lot of quiet work in Part A, and almost nobody explains it.

A benefit period starts the day you are admitted to the hospital, and ends once you have been out for 60 days in a row. If you are admitted again after those 60 days, a new benefit period begins — and you pay the $1,736 deductible again.

So it is not a calendar year. Two separate hospital stays in the same year, more than 60 days apart, means paying that deductible twice. Three stays, three times. There is no annual limit on how many benefit periods you can have.

How the Part A hospital costs actually stack up

It is worth walking through this in order, because the structure is the opposite of what most people assume. It is not a running total that stops at $1,736 — that figure is what you pay first, before Medicare pays anything.

A short stay is therefore the common case: you pay $1,736 and nothing more, because most hospital stays end well inside 60 days. The daily charges only begin if you are still in the hospital after two months.

And there is no annual out-of-pocket maximum in Original Medicare. No ceiling, no “once you’ve paid X you’re done for the year.” That single fact is the reason supplemental coverage exists at all — though whether it is right for you is a personal question, and the last section of this page says where to take it.

What are lifetime reserve days?

A one-time emergency reserve. You get 60 of them for your entire life, not 60 per year or per stay.

They begin on day 91 of a hospital stay, once the normal 90 days in that benefit period are exhausted. Each one costs you $868 in 2026, and Medicare pays the rest. Once you have used a reserve day, it is gone permanently — it does not come back next year or with a new benefit period.

Use all 60 and you reach day 150, after which you pay the entire cost of the stay yourself. Most people never touch them.

Where your blood work fits

Lab tests are Part B. Not Part A, unless you are admitted to hospital and the tests are part of that stay.

And lab work is treated unusually generously inside Part B. Most Part B services cost you 20% coinsurance after the deductible. Covered clinical lab tests cost you nothing — no deductible, no coinsurance. A covered blood test is genuinely free at the point of use.

The catch is not the cost — it is whether the test counts as covered at all, which turns on the reason your doctor put on the order. Does Medicare cover blood work? The rule that decides it →

Two traps worth knowing about

• Signing up late costs you permanently. Medicare states that you “might pay a monthly penalty if you don’t sign up for Part B when you’re first eligible,” and that “the penalty goes up the longer you wait.” The same applies to Part D if you go 63 days or more without drug coverage. These are not one-off fees.
• Your Annual Wellness Visit is not a physical, and does not include blood work. Blood drawn on the day is a separate order that stands or falls on its own. This is the most common source of surprise lab bills. More on that →

Sources

• CMS: 2026 Medicare Parts A & B Premiums and Deductibles (14 November 2025)
• CMS: Final CY 2026 Part D Redesign Program Instructions
• Medicare.gov: When can I buy a Medigap policy?
• Medicare.gov: Costs
• Medicare.gov: Diagnostic laboratory tests
• Lab payment amounts: CMS Clinical Laboratory Fee Schedule, 2026 Q3

Checked September 24, 2026. This page explains published Medicare rules and published 2026 costs. It is not insurance, financial or medical advice, and it does not recommend any plan. Plan availability and premiums vary by state.