Medicare Parts A and B Aren’t Full Coverage: The Uncapped 20% Most People Miss

Andy | November 9, 2026November 9, 2026

If you ask most people turning 65 what Medicare covers, they’ll tell you it covers everything. They’ve paid into it their whole working life, so it stands to reason — right?

Not quite. And this is the conversation I have more than any other during Medicare open enrollment: Original Medicare — Parts A and B — is good coverage, but it is not full coverage. There’s a gap in it, and the gap has no ceiling.

Here’s the part that surprises people: under Original Medicare, there is no yearly limit on what you pay out of pocket. Medicare.gov says it plainly — there’s no annual out-of-pocket maximum unless you have supplemental coverage. Part B pays 80% of the Medicare-approved amount for your care. You pay the other 20%. And that 20% never stops.

The 20% that never caps out

Most health insurance you’ve had through a job came with an out-of-pocket maximum — a number where the plan takes over and pays 100%. Original Medicare doesn’t have one. The 20% coinsurance on Part B applies to doctor visits, outpatient care, outpatient surgery, X-rays and scans, equipment like walkers and wheelchairs, and the doctor services you get while you’re in the hospital.

Here’s where it adds up. The 20% isn’t a one-time hit on one big bill — it’s a slice of almost every doctor visit, every scan, every therapy session, every outpatient procedure, all year long. Regular treatments for a serious condition can run into the tens of thousands of dollars in Medicare-approved costs in a single year, which means thousands of dollars out of your pocket in 20% shares — and there’s no point in the year where it stops. Next year, it starts over. One rough year can turn into two, and the 20% just keeps coming.

Medicare covers a lot, but it was never built to cover everything. And nobody mails you the missing piece — you have to know to ask for it.

Part A has its own bills, too

Part B isn’t the only place the costs add up. Part A, the hospital part, has a $1,736 deductible in 2026. It isn’t once a year. Medicare counts it per “benefit period” — basically, a hospital stay plus 60 days out of care before the clock resets. Two separate stays in one year can mean paying it twice.

Long stays get expensive on their own. After the deductible, days 61 through 90 in the hospital cost $434 a day in 2026. Days 91 through 150 cost $868 a day — Medicare calls these your “lifetime reserve days,” a one-time bank of extra days that doesn’t refill once you’ve used them. After day 150, you pay all costs. Skilled nursing facility care after a qualifying hospital stay runs $217 a day for days 21 through 100.

And your Part B deductible — $283 for the year in 2026 — comes out of your pocket before Medicare starts paying its 80%.

Those aren’t small numbers. Stack a few of them in a rough year and it can take a real bite out of your savings. And a note on the figures: these are the 2026 amounts — CMS usually announces the next year’s numbers in mid-November.

The fix: a Medicare Supplement fills the gap

This is where a Medicare Supplement — a Medigap plan — comes in. It sits on top of Original Medicare and pays the costs Medicare leaves behind. My standard recommendation for most people is Plan G, and the company I usually start with is Physicians Mutual.

Here’s what Plan G covers, straight from Medicare.gov’s plan comparison — and if you want the deeper dive, my Medicare Plan G page for Arizona walks through it in detail:

Your Part A deductible — 100%
Your Part B coinsurance and copayments — 100%
Part B excess charges (the extra a doctor is allowed to bill on top of Medicare’s price) — 100%
Part A hospital coinsurance, plus up to 365 extra hospital days if you run out — 100%
Skilled nursing facility coinsurance — 100%
Foreign travel emergency care — 80%, up to the plan’s limits

The one thing Plan G doesn’t cover is the Part B deductible itself — that $283 a year is yours. After that, for Medicare-covered care, you’re basically done paying, apart from your monthly premiums. That endless stream of 20% shares from the example above? With Plan G in place, Medicare pays its 80%, Plan G pays the 20%, and the drip stops.

One more thing worth knowing: with Original Medicare plus a supplement, you can see any doctor or hospital in the country that accepts Medicare. There’s no network to worry about, no referrals, and for most care no prior authorization standing between you and your doctor. (One honest exception: Medicare is testing a review program in Arizona for a short list of specific services — but there’s still no insurance plan deciding which doctors you can see.) That matters a lot here in Arizona, where people split time between states or want the freedom to go to the best facility for the problem — including Mayo Clinic, which accepts Original Medicare and supplement plans.

When to put it in place

The best time to buy a supplement is in the six months after you’re 65 and have Part B. In that window, insurance companies can’t turn you down or charge you more because of your health. Miss it, and they can ask health questions — and say no.

If you’re already past that window, don’t assume it’s too late. Sometimes there’s still a way in after the window closes — it depends on your health and your situation. Call me and I’ll tell you straight whether it’s worth pursuing.

We’re in the middle of Medicare’s Annual Enrollment Period right now — October 15 through December 7 — which is when most people are thinking about this stuff. But your Medigap decision doesn’t have to wait for a calendar window, and it shouldn’t. Medicare’s gaps don’t wait for open enrollment, and neither do hospital bills.

What I don’t do — and who I point you to

Two things worth saying plainly. I don’t sell Medicare Advantage plans. Some people solve the 20% problem that way — Advantage plans do cap yearly out-of-pocket costs — and if that’s the direction you want, call me and I’ll point you to the right person for it. And I don’t sell Part D drug plans; for prescription coverage, Medicare.gov is the place to compare your options.

What I do is help you understand the gap, run the numbers for your situation, and put the right supplement in place — then answer my own phone when you have questions later.

If you’re turning 65 soon, or you’ve been on Medicare A and B alone and that 20% has started to worry you, let’s talk it through before something happens. A short conversation now beats watching the 20% shares pile up later.

Questions about your Medicare coverage? Call me at (623) 742-3878 or visit www.azhealth.us. I’m a real person, I answer my own phone, and the help is free.