Medicare · Supporting
Centers for Medicare and Medicaid Services: the agency behind your Medicare
Last reviewed September 10, 20264 min readBy the Goodsurance editorial team Reviewed by the Goodsurance editorial team
The Centers for Medicare and Medicaid Services (CMS) is the federal agency within the U.S. Department of Health and Human Services responsible for administering Medicare, Medicaid, the Children's Health Insurance Program (CHIP), and the federal Health Insurance Marketplace. For Medicare beneficiaries, CMS is the source of nearly every rule governing their coverage: which services are covered, what providers can charge, and what enrollees owe at the point of care.
What CMS is and what it does
CMS is not a health insurer in the traditional sense. It writes the coverage rules and sets payment rates; private insurers, hospitals, and physicians operate inside those rules. When a Medicare premium or deductible figure appears in an official notice, it was calculated and published by CMS using a blend of statutory formulas, actuarial analysis, and a public comment process.
How CMS sets what you pay each year
Each fall, CMS announces the following year's cost-sharing figures for Original Medicare. In 2026, the standard Part B premium is $202.90 per month, according to CMS. Part B covers outpatient services, most doctor visits, and lab work. The 2026 annual Part B deductible is $283. After that deductible, Medicare pays 80% of the approved amount and the beneficiary pays 20%, with no annual cap on that 20% under Original Medicare alone.
For hospital care under Part A, the 2026 inpatient deductible is $1,736 per benefit period. That is not a per-year figure. A benefit period begins when a beneficiary is admitted to a hospital or skilled nursing facility and ends when they have been out for 60 consecutive days, so two separate hospitalizations in a single calendar year can each trigger the full deductible.
Higher-income enrollees pay more through IRMAA, the Income-Related Monthly Adjustment Amount. In 2026, IRMAA begins above $109,000 in modified adjusted gross income for single filers and $218,000 for joint filers. The surcharge applies to both Part B and Part D premiums and uses a two-year lookback: 2026 premiums are based on 2024 income reported to the IRS.
Your 2026 Part B and Part D premiums are based on income you reported to the IRS for 2024, not what you earn today. If your income has dropped since then, you can ask CMS to use a more recent year.
CMS and prescription drug coverage
CMS governs Part D, the prescription drug benefit, including the rules plans must follow and the limits on what they can charge. In 2026, no Part D plan may set a deductible above $615. The Inflation Reduction Act also created an annual out-of-pocket cap that CMS enforces: in 2026, total out-of-pocket spending on covered drugs is limited to $2,100. Once a beneficiary reaches that cap, covered drugs cost $0 for the rest of the calendar year.
CMS also administers the drug price negotiation program established by the Inflation Reduction Act. Negotiated maximum fair prices for a second set of 15 Part D drugs take effect January 1, 2027.
Going without creditable drug coverage for 63 or more days after the initial enrollment window triggers a permanent Part D late-enrollment penalty. CMS calculates that penalty as 1% of the national base beneficiary premium multiplied by the number of full uncovered months; in 2026, that base premium is $38.99. Because the base premium changes each year, the dollar amount of a locked-in penalty can drift upward over time even though the percentage stays fixed.
Your drug costs stop here each year.
CMS rules for Medicare Advantage
Medicare Advantage (Part C) plans are sold by private insurers but operate under detailed CMS regulations. CMS sets a federal ceiling on annual out-of-pocket costs for in-network services. In 2026, that ceiling is $9,250; the combined in-network plus out-of-network ceiling is $13,900. Individual plans may set lower limits, and according to KFF, the 2026 enrollment-weighted average in-network limit is $5,421.
A rule change that took effect in 2026 under CMS-0057-F tightened prior-authorization timelines. Standard prior-authorization decisions must now come within 7 calendar days; expedited decisions must come within 72 hours. Denials must include a specific reason, which gives beneficiaries a clearer basis for appeal.
CMS publishes annual Star Ratings for Medicare Advantage and Part D plans, scoring them on preventive care rates, chronic condition management, and member experience. Those ratings affect plan payments and bonus eligibility, making them a consistent, CMS-defined measure of plan quality you can compare before the Annual Enrollment Period (AEP), which runs October 15 to December 7 each year.
How to use CMS tools and resources
CMS operates medicare.gov as the direct consumer portal. The plan-comparison tools there pull live formulary and cost data, so you can compare Part D drug costs across available plans using your specific prescriptions and preferred pharmacies. CMS also publishes the Medicare and You handbook each fall, summarizing cost and coverage changes for the coming year in print and online.
If a coverage denial or billing dispute arises, CMS's appeals process gives beneficiaries the right to a redetermination from the plan, then escalating reviews including an independent review entity and, ultimately, a federal hearing. CMS is the governing authority over coverage policy; billing disputes at the plan level follow a separate but parallel track.
To find out more about how 2026 CMS rules apply to your specific coverage situation, please contact us to discuss plan options.
Common questions about IRMAA appeals
Quick answers, fast .
Tap any question to expand. Each links to a fuller standalone answer.
Does Medicare pay for hearing aids
Original Medicare does not cover hearing aids or fittings.
Some Medicare Advantage plans may include a hearing benefit, but what they cover varies by plan.
Does Medicare cover ambulance services?
Yes, in limited situations.
Medicare Part B covers emergency ambulance transportation when traveling any other way could endanger your health, taking you to the nearest appropriate hospital or facility. You pay 20% of the Medicare-approved amount after the $283 Part B deductible in 2026. Air ambulance is covered only when ground transport cannot reach you or would take too long. Non-emergency ambulance trips, for example to dialysis, are covered only when a doctor provides a written order stating they are medically necessary. Medicare does not cover ambulance rides taken purely for convenience.
Does Medicare cover skilled nursing facility care?
Yes, on a short-term basis.
Medicare Part A covers skilled nursing facility (SNF) care after a qualifying inpatient hospital stay of at least 3 days, when you need daily skilled care like nursing or therapy. In 2026 you pay $0 for days 1 through 20 of each benefit period, $217 per day for days 21 through 100, and all costs after day 100. Coverage is for skilled care while you recover, not for long-term or custodial care (help with daily activities like bathing or dressing), which Medicare does not cover. Long-term nursing home care is generally paid through Medicaid or private funds.
Does Medicare cover physical therapy?
Yes.
Medicare Part B covers outpatient physical therapy that is medically necessary to treat your condition. You pay 20% of the Medicare-approved amount after the yearly Part B deductible ($283 in 2026). There is no longer a hard dollar cap on therapy, but once your physical and speech therapy together pass $2,480 in 2026, your therapist must add a note (called a KX modifier) confirming you still need care. Claims above $3,000 may be reviewed for medical necessity. Part A covers physical therapy you receive as a hospital inpatient or in a skilled nursing facility. A doctor or therapist must set up and regularly review your plan of care.
Does Medicare cover mental health services?
Yes.
Medicare covers mental health care across its parts in 2026. Part B covers outpatient services like therapy, counseling, and visits with psychiatrists, psychologists, and clinical social workers, and since 2024 it also covers marriage and family therapists and mental health counselors. You pay 20% of the Medicare-approved amount after the $283 deductible, and one depression screening each year is free. Part A covers inpatient mental health care, with a lifetime limit of 190 days in a freestanding psychiatric hospital. Part D covers most mental health medications. Many of these services are also available by telehealth, and Medicare Advantage plans cover at least the same benefits.
Does Medicare cover chiropractic care?
Partly.
Medicare Part B covers one specific chiropractic service: manual manipulation of the spine to correct a subluxation (when one or more bones of the spine are out of position) that a doctor confirms is medically necessary. You pay 20% of the Medicare-approved amount after the $283 Part B deductible in 2026. Medicare does not cover other services a chiropractor might offer, such as X-rays, massage therapy, acupuncture, or routine wellness visits, so you would pay the full cost for those. Some Medicare Advantage plans include extra chiropractic or wellness benefits beyond this.
Does Medicare cover home health care?
Yes, when you qualify.
Medicare Parts A and B cover home health care if a doctor certifies that you are homebound (leaving home takes a major effort) and need part-time skilled care, such as skilled nursing, physical therapy, occupational therapy, or speech therapy. A Medicare-certified home health agency must provide the care under a plan your doctor reviews. You pay $0 for covered home health visits in 2026, and 20% for any durable medical equipment. Medicare does not cover 24-hour home care, meal delivery, or homemaker services like cleaning when that is the only care you need.
Does Medicare cover vision care?
Mostly no for routine care.
In 2026, Original Medicare does not cover routine eye exams for glasses or contact lenses, and it does not pay for the glasses or contacts themselves. It does cover some medical eye care: yearly glaucoma screenings for people at high risk, diabetic retinopathy exams, treatment for eye diseases, and cataract surgery (including one pair of standard glasses or contacts afterward). For those covered services you pay 20% after the $283 Part B deductible. Many Medicare Advantage plans add a routine vision benefit covering eye exams and an allowance for glasses.
Does Medicare cover hearing aids?
Original Medicare does not cover hearing aids or the exams used to fit them.
Some Medicare Advantage plans include a hearing benefit, but coverage varies by plan.
Does Medicare cover diabetes supplies and testing?
Yes.
In 2026 Medicare covers most diabetes care across two parts. Part B (outpatient care and equipment) covers blood sugar monitors, test strips, lancets, and continuous glucose monitors (CGMs) as durable medical equipment, plus diabetes screenings and a self-management training program. You pay 20% of the Medicare-approved amount after the $283 Part B deductible. Part D (drug coverage) covers insulin and related supplies like syringes, and in 2026 your insulin is capped at $35 for a month's supply. If you have a Medicare Advantage plan, it covers at least the same diabetes benefits, sometimes with added extras.
Does Medicare cover durable medical equipment?
Yes.
Medicare Part B covers durable medical equipment (DME): reusable medical gear your doctor prescribes for use at home, such as wheelchairs, walkers, hospital beds, oxygen equipment, CPAP machines, and blood sugar monitors. You pay 20% of the Medicare-approved amount after the $283 Part B deductible in 2026, and Medicare pays the other 80%. To be covered, the item must be ordered by a Medicare-enrolled doctor and supplied by a Medicare-enrolled supplier, and some items are rented rather than bought. Equipment meant mainly for use outside the home, or only for comfort or convenience, is not covered.
Which is better, Medigap or Medicare Advantage?
Neither is better for everyone; they suit different needs.
Medigap (also called Medicare Supplement, a private policy that pairs with Original Medicare) lets you see any doctor nationwide who accepts Medicare with no network and very predictable out-of-pocket costs, but you pay a monthly Medigap premium and add a separate Part D drug plan. Medicare Advantage (Part C, your Medicare benefits through a private plan) often has a lower or $0 plan premium, bundles drug coverage and extras like dental and vision, and caps your yearly out-of-pocket costs, but uses provider networks and may require prior approval. People who travel, want maximum doctor freedom, and prefer steady costs often lean Medigap; people who want low premiums, extras, and a network they are comfortable with often lean Medicare Advantage. With both, you still pay the Part B premium ($202.90 per month in 2026). To find out which fits your situation, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
References
- 2026 Medicare Parts B premiums and deductiblesOfficial CMS fact sheet with all 2026 Part A and Part B cost-sharing figures, including the standard monthly premium, annual deductibles, and inpatient coinsurance amounts.
- 2026 Medicare Part D bid information and premium stabilization demonstration parametersCMS fact sheet covering the 2026 Part D out-of-pocket cap, maximum plan deductible, and national base beneficiary premium used in late-enrollment penalty calculations.
- Medicare Advantage in 2026: premiums, out-of-pocket limits, supplemental benefits, and prior authorizationKFF analysis of 2026 Medicare Advantage MOOP ceilings, enrollment-weighted averages, and the prior-authorization rule changes under CMS-0057-F.
- Medicare drug price negotiation program: selected drugs and negotiated pricesCMS overview of the drugs selected across negotiation cycles and the effective dates for negotiated maximum fair prices.