What Medicare Doesn't Cover
Original Medicare covers a lot — but it doesn't cover everything. The gaps can cost thousands, and there's no annual limit on what you pay out of pocket.
How the 80/20 Split Works
Example: a $10,000 outpatient procedure after meeting your deductible
If the bill is $100,000, you pay $20,000. If it's $200,000, you pay $40,000. There is no cap.
With Medigap Plan G, your share drops to $283/year (the Part B deductible) — regardless of the total bill.
The 80/20 rule — and the missing safety net
Medicare Part B pays 80% of approved medical costs. You pay the remaining 20%. That might sound manageable — until you realize there is no annual out-of-pocket maximum.
Most private insurance plans cap your spending at $5,000 to $8,000 per year. Original Medicare has no such cap. If you have a $200,000 surgery, your 20% share is $40,000 — and Medicare will not stop you from paying it.
This is the gap that catches people off guard. Medicare is excellent insurance with one critical flaw: it has no ceiling on your costs.
Where the gaps are: Part A and Part B
Part A (Hospital)
Covers: Inpatient hospital stays, skilled nursing (limited), hospice care, some home health
Gaps you're responsible for:
- Hospital deductible: $1,676 per benefit period (2026)
- Days 61-90: $419/day coinsurance
- Days 91+: $838/day for lifetime reserve days
- Skilled nursing days 21-100: $209.50/day coinsurance
- Beyond 100 days of skilled nursing: you pay everything
Part B (Medical)
Covers: Doctor visits, outpatient care, lab tests, imaging, durable medical equipment, preventive services
Gaps you're responsible for:
- Annual deductible: $283 (2026)
- 20% coinsurance on all approved services — with no annual cap
- Excess charges: doctors who don't accept assignment can charge up to 15% above Medicare rates
- Most dental, vision, and hearing care not covered
- Prescription drugs not covered (need Part D)
What these gaps actually cost: real examples
These are approximate costs for someone on Original Medicare with no supplemental coverage. All figures use 2026 Medicare rates.
| Medical event | Total cost | Medicare pays | You pay |
|---|---|---|---|
| Hip replacement surgery | $40,000 | $31,717 | $8,283 |
| Heart attack + 5-day hospital stay | $75,000 | $58,324 | $16,676 |
| Cancer treatment (6 months of chemo) | $120,000 | $95,717 | $24,283 |
Estimates based on 2026 Medicare cost-sharing. Actual costs vary by provider, region, and services rendered.
Three ways to fill the gaps
Medicare Supplement (Medigap)
A private policy that covers the gaps in Original Medicare — deductibles, coinsurance, and copays. You keep Original Medicare and see any doctor who accepts it. Monthly premiums vary by plan and carrier.
Medicare Advantage (Part C)
A private plan that replaces Original Medicare. Often lower premiums, but you use a network and pay copays per service. Includes an out-of-pocket maximum.
Self-insure
Pay the 20% coinsurance out of pocket. Viable only if you have significant savings and are comfortable absorbing a $25,000+ medical bill in a bad year.
Common questions
Does Medicare cover prescription drugs?
No. Original Medicare does not cover most outpatient prescription drugs. You need a separate Medicare Part D plan for drug coverage. Some Medicare Advantage plans bundle drug coverage, but Medigap plans do not.
What about dental, vision, and hearing?
Original Medicare covers very limited dental (certain jaw procedures), very limited vision (post-cataract surgery), and no routine hearing exams or hearing aids. Neither Medigap nor Original Medicare covers routine dental, vision, or hearing — you'll need separate coverage for those.
Is there a limit on how much I can pay out of pocket?
No. Original Medicare has no annual out-of-pocket maximum. This is the most important gap to understand. A Medigap plan effectively creates a ceiling by covering most or all of the cost-sharing.
Now that you know the gaps — what are your options?
The next step is understanding whether Medigap or Medicare Advantage is the right path for you.