How to Choose a Medicare Plan
Understanding Your Core Medicare Options
Before you can choose the best plan, you need to understand what's available. Medicare coverage breaks down into a few main categories.
Original Medicare (Parts A & B)
Original Medicare is the federal health insurance program that's been around since 1965. It consists of two parts:
Part A (Hospital Insurance) covers inpatient hospital stays, skilled nursing facility care, hospice, and some home health services. Most people don't pay a premium for Part A if they or their spouse paid Medicare taxes while working.
Part B (Medical Insurance) covers doctor visits, outpatient care, preventive services, durable medical equipment, and some home health services. Part B requires a monthly premium, which in 2026 is $185/month for most beneficiaries (though higher earners pay more).
Original Medicare doesn't cover prescription drugs, so most people add Part D coverage. It also comes with cost-sharing requirements — deductibles, coinsurance, and no annual out-of-pocket maximum — which is why many beneficiaries purchase supplemental coverage.
Medicare Advantage (Part C)
Medicare Advantage plans are offered by private insurance companies approved by Medicare. These plans provide all your Part A and Part B coverage, and most include prescription drug coverage built in.
Medicare Advantage plans often offer additional benefits that Original Medicare doesn't cover, such as dental, vision, hearing, and fitness programs. They typically have lower monthly premiums than Original Medicare plus supplements, but use network restrictions and may require referrals to see specialists.
Medigap (Medicare Supplement Insurance)
Medigap policies are sold by private insurance companies to help fill the "gaps" in Original Medicare — the deductibles, copayments, and coinsurance you'd otherwise pay out of pocket. If you have Original Medicare, a Medigap policy can provide significant financial protection and peace of mind.
These standardized plans (labeled with letters like Plan G or Plan N) work alongside Original Medicare. You'll pay a monthly premium for the Medigap policy in addition to your Part B premium.
Plan G, the most popular Medigap plan in 2026, covers everything except the Part B deductible ($283 in 2026).
Prescription Drug Coverage (Part D)
Stand-alone Part D plans provide prescription drug coverage if you have Original Medicare. These plans are offered by private insurance companies, and each plan has its own list of covered drugs (formulary) and its own costs.
The Part D out-of-pocket maximum (MOOP) in 2026 is $2,100 — once you reach this amount, you pay nothing more for covered drugs for the rest of the year.
If you choose Medicare Advantage, drug coverage is usually included in your plan, so you typically won't need a separate Part D plan.
Key Decision Factors: What Matters Most
Choosing between these options isn't about finding the "best" plan in the abstract — it's about finding the best plan for you. Here are the critical factors to consider.
Your Health Needs and Medical History
Start by honestly assessing your current health status and anticipated needs:
- Do you have chronic conditions that require regular specialist visits or ongoing treatment?
- Are you generally healthy with minimal healthcare needs?
- Do you anticipate major medical expenses like surgery in the coming year?
- How often do you see doctors, and what types of specialists do you need?
If you have complex health needs or see multiple specialists, Original Medicare with a Medigap plan often provides more flexibility. You won't need referrals, can see any Medicare-accepting provider nationwide, and have predictable out-of-pocket costs.
If you're relatively healthy and don't mind working within a network, Medicare Advantage might offer better value with lower premiums and extra benefits.
Your Budget and Financial Situation
Medicare plans have different cost structures, and it's crucial to look beyond just the monthly premium:
Monthly premiums: Medicare Advantage plans often have lower (sometimes $0) premiums, while Medigap plans typically have higher premiums. Don't forget you'll always pay your Part B premium ($185/month in 2026) regardless of which option you choose.
Out-of-pocket costs: Original Medicare has no annual limit on out-of-pocket costs unless you have a Medigap plan. Medicare Advantage plans have annual maximum out-of-pocket limits, which can protect you if you have significant medical expenses.
Deductibles and copays: Consider how often you use healthcare and what you'd pay per visit. Medicare Advantage plans typically charge copays for doctor visits and services. With Medigap Plan G, you pay only the Part B deductible ($283 in 2026), then have minimal or no cost-sharing.
Total annual costs: Calculate your likely total spending — premiums plus expected out-of-pocket costs based on your typical healthcare usage — for each option you're considering.
Your Preferred Doctors and Hospitals
This factor alone can make your decision for you:
With Original Medicare, you can see any doctor or use any hospital in the United States that accepts Medicare (which is the vast majority). You don't need referrals to see specialists, and you never have to worry about staying in-network.
With Medicare Advantage, you must generally use doctors and hospitals in the plan's network (except for emergencies). If your longtime physicians aren't in a plan's network, you'll either need to switch doctors or pay significantly more for out-of-network care (if it's even covered).
Before choosing Medicare Advantage, confirm that your preferred providers are in-network and check whether they're accepting new patients with that plan. Networks can change annually, so this requires ongoing attention.
Prescription Drug Needs
Your medications can dramatically affect which plan offers the best value:
- Make a complete list of all your prescriptions, including dosages
- Use a plan comparison tool to see how different plans cover your specific drugs
- Check each plan's formulary (list of covered drugs) and tier placement
- Note pharmacy restrictions — some plans require mail-order for certain medications or prefer specific pharmacy chains
A plan with a low premium might be expensive if it doesn't cover your medications well. Conversely, a plan with a higher premium might save you thousands if it provides better drug coverage for your needs.
Remember: the Part D out-of-pocket cap is $2,100 in 2026, which provides significant protection for people with high drug costs.
Travel Habits and Geographic Flexibility
Original Medicare provides coverage anywhere in the United States, making it ideal for frequent travelers or people who split time between different states. Medigap Plans C, D, F, G, M, and N also provide coverage for foreign travel emergencies (up to plan limits).
Medicare Advantage plans typically have local or regional networks. If you travel frequently or spend winters in another state, you may have limited coverage outside your plan's service area, except for emergency care.
Making Your Decision: A Step-by-Step Approach
Step 1: Determine Your Priorities
Rank what matters most to you: provider flexibility, predictable costs, low premiums, prescription coverage, or extra benefits like dental and vision. Your top priorities will point you toward one option or another.
Step 2: Compare Total Costs
Don't just compare premiums. Estimate your total annual costs for each option based on your expected healthcare usage. Include premiums, deductibles, copays, prescription costs, and potential out-of-pocket expenses.
Step 3: Check Provider Networks
If considering Medicare Advantage, verify your doctors and preferred hospitals are in-network. Call the providers' offices to confirm they're accepting new patients with the specific plan you're considering.
Step 4: Review Prescription Coverage
Use a plan comparison tool to see exactly what you'd pay for your medications under each plan option. This can reveal surprising differences.
Step 5: Consider Your Comfort with Risk
Are you comfortable with the possibility of high out-of-pocket costs in exchange for lower premiums? Or do you prefer paying more monthly for predictable, protected costs? Your risk tolerance matters.
Step 6: Think Long-Term
While you can change Medicare Advantage plans annually, switching from Medicare Advantage to Original Medicare with Medigap can be difficult after your initial enrollment period — you may face medical underwriting and could be denied coverage. Consider where you might want to be in 5–10 years.
Understanding Enrollment Periods
Timing matters with Medicare. Here are the key enrollment windows:
Initial Enrollment Period (IEP): The 7-month period around your 65th birthday (3 months before your birthday month, your birthday month, and 3 months after). This is when you have guaranteed issue rights for Medigap policies.
Annual Open Enrollment (October 15 – December 7): You can switch from Original Medicare to Medicare Advantage, from Medicare Advantage to Original Medicare, or from one Medicare Advantage or Part D plan to another.
Medicare Advantage Open Enrollment (January 1 – March 31): If you're already enrolled in a Medicare Advantage plan, you can switch to a different Medicare Advantage plan or drop your Medicare Advantage plan for Original Medicare.
Special Enrollment Periods: Certain circumstances (like moving or losing other coverage) trigger special enrollment periods outside these standard windows.
Common Mistakes to Avoid
- Choosing based solely on premium cost without considering total out-of-pocket expenses
- Not checking if your doctors accept the plan before enrolling
- Missing your Initial Enrollment Period, which can result in penalties and limited Medigap options
- Assuming you can easily switch later without understanding medical underwriting for Medigap
- Ignoring prescription drug coverage, leading to significant unexpected costs
- Not reviewing your plan annually — your needs change, and so do plan benefits
The Bottom Line
If you value unlimited provider choice and predictable costs, and don't mind higher premiums, Original Medicare with Medigap and Part D is often the way to go. If you prefer lower premiums, want extra benefits, are comfortable with networks, and don't mind some cost uncertainty, Medicare Advantage might be your best bet.
Take your time, run the numbers for your specific situation, and remember: you're not locked in forever. While some changes are easier than others, Annual Open Enrollment gives you a chance each year to reassess and switch if needed.