Medicare glossary.

A

AEP (Annual Enrollment Period)

Oct 15 - Dec 7 each year. Window when any Medicare beneficiary can change Medicare Advantage or Part D plans. Plan changes take effect Jan 1.

ANOC (Annual Notice of Change)

Document carriers mail by Sep 30 each year showing what's changing in your current plan for the next calendar year — premiums, copays, networks, formularies.

Assignment

When a doctor or supplier accepts the Medicare-approved amount as full payment. They can't charge you more than the deductible and coinsurance. Most Medicare providers accept assignment.

B

Benefit Period

The way Original Medicare measures hospital stays. Begins the day you're admitted as inpatient, ends 60 consecutive days after you've left the hospital or skilled nursing facility. New deductible applies each new benefit period.

Birthday Rule (Medigap)

State-specific rule allowing Medigap policyholders to switch to an equal or lesser plan from any insurer without medical underwriting during a window around their birthday. CA, ID, NV, OR, OK, MD have Birthday Rules.

C

Catastrophic Coverage (Part D)

Phase of Part D drug coverage after you reach the $2,000 out-of-pocket cap (2026). All covered drugs are $0 for the rest of the year.

CMS (Centers for Medicare and Medicaid Services)

The federal agency that runs Medicare. Sets rules, contracts with private MA carriers, publishes Star Ratings.

Coinsurance

Percentage of costs you pay for a covered service, after meeting your deductible. Original Medicare Part B coinsurance is 20% of approved charges.

Copayment / Copay

Flat dollar amount you pay for a covered service. Most common in Medicare Advantage and Part D plans (e.g., $20 office visit, $0 generic prescription).

Coverage Gap (Donut Hole)

Phase of Part D coverage that effectively no longer exists in 2026. Replaced by the simpler $2,000 out-of-pocket cap. The donut hole was eliminated as a meaningful concept under the Inflation Reduction Act.

Creditable Coverage

Health insurance that's at least as good as Medicare. Having creditable coverage during a delay period prevents Part B and Part D late enrollment penalties. Employer group health plans (20+ employees), TRICARE, VA, and federal employee benefits all count.

D

Deductible

Amount you pay out of pocket before Medicare or your plan starts covering. 2026 Part A inpatient deductible: $1,712 per benefit period. Part B annual deductible: $259.

D-SNP (Dual Eligible Special Needs Plan)

A Medicare Advantage plan designed for people with both Medicare and Medicaid. Typically $0 premium, $0 copays, generous OTC and transportation benefits.

DME (Durable Medical Equipment)

Equipment that can be reused — wheelchairs, walkers, oxygen, CPAP machines, blood glucose monitors. Covered under Part B (80% Medicare, 20% you, after deductible).

E

EOB (Explanation of Benefits)

Statement from Medicare or your Medicare Advantage plan showing what was billed, what they paid, and what you may owe. Not a bill.

Excess Charges (Part B)

Amount over the Medicare-approved amount that some non-participating doctors can charge — up to 15% extra. Only allowed in 41 states; banned in CT, MA, MN, NY, OH, PA, RI, VT.

Extra Help (LIS)

Federal Low Income Subsidy program that reduces Part D drug costs for low-income Medicare beneficiaries. 2026 income limits: $1,903/mo single, $2,575/mo couple.

F

Formulary

The list of prescription drugs covered by a Part D or Medicare Advantage Prescription Drug (MA-PD) plan. Drugs are organized into tiers (1-5 typically) with different copays.

FPL (Federal Poverty Level)

Annual income standards used to determine eligibility for Medicaid, MSP, Extra Help, and ACA subsidies. 2026 FPL: $15,650 single, $21,150 couple.

G

GEP (General Enrollment Period)

Jan 1 - Mar 31 each year. Window for people who missed their Initial Enrollment Period to enroll in Part B. Coverage starts the month after enrollment, plus 10% per year late enrollment penalty for life.

Guaranteed Issue (Medigap)

Specific situations where a Medigap insurer must sell you a policy without medical underwriting. Most common: 6-month Medigap Open Enrollment after starting Part B at 65.

H

HMO (Health Maintenance Organization)

Type of Medicare Advantage plan with a network of doctors. Requires you to use in-network doctors and get referrals to see specialists.

Hold Harmless Provision

Rule protecting most Social Security recipients from Part B premium increases that exceed their annual COLA. About 70% of Medicare beneficiaries are protected.

HSA (Health Savings Account)

Tax-advantaged account paired with high-deductible health plans. You cannot contribute to an HSA once enrolled in any part of Medicare (including premium-free Part A).

I

ICEP (Initial Coverage Election Period)

The first time you can choose a Medicare Advantage plan — same window as your IEP for most people, but only used for MA enrollment.

IEP (Initial Enrollment Period)

The 7-month window around your 65th birthday when you can first enroll in Medicare. Starts 3 months before your 65th birthday month, includes that month, ends 3 months after.

IRMAA (Income-Related Monthly Adjustment Amount)

Surcharge added to Part B and Part D premiums for high-income beneficiaries. 2026 thresholds start at $106K single / $212K couple. Full IRMAA bracket guide →

L

LEP (Late Enrollment Penalty)

Permanent surcharge added to Part B (10% per year delayed) or Part D (1% per month delayed) for missing your initial enrollment without creditable coverage. Penalty calculator →

LIS (Low Income Subsidy)

Same as Extra Help — federal program reducing Part D drug costs for low-income Medicare beneficiaries.

M

MAGI (Modified Adjusted Gross Income)

Your AGI plus certain deductions added back (most commonly tax-exempt interest). Used to determine IRMAA brackets and ACA subsidy eligibility.

MAPD (Medicare Advantage Prescription Drug)

A Medicare Advantage plan that includes Part D drug coverage built in. Most MA plans are MAPD.

Medicaid

Federal-state program providing health coverage to low-income Americans. Different from Medicare. People with both are called "dual eligible."

Medicare Advantage (Part C)

Private alternative to Original Medicare. Bundles Parts A, B, and usually D into a single plan from a private carrier (Humana, UHC, Aetna, etc.). Network-based.

Medigap (Medicare Supplement)

Supplemental insurance that pays out-of-pocket costs left by Original Medicare (the 20% Part B coinsurance, deductibles, etc.). Standardized lettered plans (G, N, F, etc.).

MSP (Medicare Savings Program)

State-administered programs that pay your Medicare costs (premiums, deductibles, copays) if you have limited income. Includes QMB, SLMB, QI, QDWI. MSP guide →

N

Network

The group of doctors, hospitals, and pharmacies that contract with a Medicare Advantage or Part D plan. In-network costs are lower; out-of-network may not be covered.

O

OEP (Open Enrollment Period)

Jan 1 - Mar 31 each year. Window for current Medicare Advantage members to switch to a different MA plan or return to Original Medicare. One change allowed.

Original Medicare

Medicare Parts A (hospital) and B (medical). The traditional government-run version of Medicare. No network restrictions but no out-of-pocket maximum.

OON (Out-of-Network)

Providers not contracted with your Medicare Advantage plan. HMOs typically don't cover OON; PPOs cover OON at higher cost.

OTC (Over-the-Counter Benefit)

Quarterly or annual allowance some Medicare Advantage plans give for OTC items (vitamins, pain relievers, first aid, etc.). Typical: $50-$200/quarter.

P

Part A

Hospital insurance covering inpatient stays, skilled nursing, hospice, some home health. Premium-free for most people with 40 quarters of work credits.

Part B

Medical insurance covering doctor visits, outpatient care, lab tests, preventive care, durable medical equipment. Standard 2026 premium: $185.00/mo.

Part C

Medicare Advantage — private alternative to Original Medicare bundling Parts A and B (and usually D) into one plan.

Part D

Prescription drug coverage. Available as standalone plan (with Original Medicare) or built into Medicare Advantage. 2026 out-of-pocket cap: $2,000.

PCP (Primary Care Physician)

Your main doctor. HMO Medicare Advantage plans require a PCP and referrals to see specialists. PPO and Original Medicare don't.

PFFS (Private Fee-for-Service)

Less common type of Medicare Advantage plan. Pays providers a private fee schedule. Largely phased out in most areas.

Plan Finder

Medicare's official tool at Medicare.gov to compare plans by ZIP. Updated each Oct 1 with new year's plan data.

PPO (Preferred Provider Organization)

Type of Medicare Advantage plan that covers both in-network (lower cost) and out-of-network (higher cost) care. No referrals required.

Prior Authorization

Approval required from your Medicare Advantage plan before certain services or medications are covered. More common in MA than Original Medicare.

Q

QMB (Qualified Medicare Beneficiary)

The most generous Medicare Savings Program. Pays your Part A & B premiums, deductibles, and copays. 2026 income limit: $1,255/mo single.

QDWI (Qualified Disabled and Working Individual)

MSP for working disabled people under 65 who lost premium-free Part A. Pays Part A premium only.

QI (Qualifying Individual)

MSP that pays Part B premium only. Income limit higher than SLMB ($1,695/mo single in 2026). Funded by federal block grant — annual reapplication required.

R

Rating Area

Geographic region used by Medicare Advantage and ACA carriers for pricing. Each state has multiple rating areas (Florida has 67, California has 19).

S

SEP (Special Enrollment Period)

Window outside the standard enrollment periods (IEP, AEP, OEP) triggered by life events: moving, losing coverage, qualifying for Medicaid, plan termination. Each SEP has different rules.

SLMB (Specified Low-Income Medicare Beneficiary)

MSP that pays your Part B premium. 2026 income limit: $1,506/mo single.

SNP (Special Needs Plan)

Type of Medicare Advantage plan for specific groups: D-SNPs (dual eligible), C-SNPs (chronic conditions), I-SNPs (institutional residents).

SSA (Social Security Administration)

Federal agency that handles Medicare enrollment, eligibility, and IRMAA. Not the same as CMS, which administers the Medicare program itself.

Star Rating

CMS's quality rating for Medicare Advantage and Part D plans, 1-5 stars. 5-star plans get year-round enrollment SEP. Plans below 3 stars for 3+ years can be terminated.

T

Tier (Drug Tier)

Level on a Part D formulary that determines copay. Tier 1 = preferred generics ($0-10), Tier 2 = generics, Tier 3 = preferred brands ($40-60), Tier 4 = non-preferred brands, Tier 5 = specialty.

Trial Right

If you enrolled in Medicare Advantage when first eligible at 65 and disenroll within 12 months, you can return to Original Medicare and enroll in any Medigap plan with no medical underwriting.

U

Underwriting (Medical)

The process insurers use to evaluate your health before issuing a Medigap policy. Outside guaranteed-issue periods, you may be denied or charged higher premiums.