Medicare Part B covers medically necessary outpatient services and preventive care that help seniors stay healthy and treat medical conditions outside of a hospital stay. It pays for doctor visits, lab tests, mental health care, durable medical equipment, ambulance rides, and dozens of preventive screenings at no extra cost.
Under 42 U.S.C. § 1395k, Part B only reimburses 80% of the Medicare-approved amount after you meet the annual deductible — leaving seniors responsible for a 20% coinsurance with no out-of-pocket cap. That open-ended cost exposure is the single biggest financial risk in Original Medicare.
Nearly 65 million Americans are enrolled in Medicare as of 2024, and Part B premiums have risen to $202.90 per month in 2026. Here’s what you’ll learn in this article:
- 🩺 Every major service and item Part B pays for — with real-world examples
- 💰 The exact 2026 costs you’ll face, including premiums, deductibles, coinsurance, and IRMAA surcharges
- ⚠️ Critical mistakes that trigger lifetime penalties and how to avoid them
- 🛡️ How Medigap and Medicare Advantage interact with Part B coverage
- 📋 The prior authorization rules rolling out in 2026 and which states are affected
How Part B Differs from Part A
Medicare Part A and Part B work together, but they cover different types of care. Part A handles inpatient hospital stays, skilled nursing facility care, hospice, and some home health services. Part B picks up almost everything that happens outside of an inpatient setting.
| Part A (Hospital Insurance) | Part B (Medical Insurance) |
|---|---|
| Inpatient hospital stays | Doctor and specialist visits |
| Skilled nursing facility care | Outpatient surgeries |
| Hospice care | Lab tests and X-rays |
| Some home health care | Durable medical equipment |
Many seniors assume a hospital visit is always Part A. That’s wrong. If you visit the emergency room and are treated as an outpatient — even if you stay overnight under “observation status” — Part B covers the bill, not Part A. This distinction can cost thousands of dollars because Part B’s 20% coinsurance applies instead of Part A’s flat deductible.
The Full List of Part B Covered Services
Part B is broader than most seniors realize. The Center for Medicare Advocacy lists 27 categories of covered items and services. Here are the most important ones grouped by type.
Doctor and Specialist Visits
Part B pays for visits to your primary care physician, specialists, and surgeons in an office or clinic setting. It also covers telehealth visits and second opinions before surgery.
Example: Linda, age 68, sees a cardiologist for chest pain. The cardiologist charges $350 for the visit. Medicare’s approved amount is $280. After Linda has met her $283 annual deductible, Part B pays 80% ($224) and Linda pays the remaining 20% ($56).
Diagnostic Tests and Lab Work
Part B covers diagnostic X-rays, MRIs, CT scans, blood tests, urinalysis, and biopsies when ordered by a treating physician. Clinical diagnostic lab tests — such as blood work — are typically covered at 100% with no coinsurance when performed by a Medicare-participating lab.
Example: Robert, age 72, needs an MRI on his knee after a fall. His orthopedist orders the scan at an outpatient imaging center. Part B covers 80% of the Medicare-approved amount after the deductible. Robert pays 20% out of pocket.
Outpatient Hospital and Surgical Services
Emergency room visits, outpatient surgeries, and same-day procedures fall under Part B. This includes ambulatory surgical center services and hospital outpatient departments.
Under the Outpatient Prospective Payment System (OPPS), the coinsurance for hospital outpatient services can sometimes exceed 20% of the Medicare-approved amount. A fixed copayment is calculated based on the service and the hospital, though federal law caps the copayment at 40% of the outpatient payment amount.
Durable Medical Equipment (DME)
Part B covers medically necessary equipment your doctor prescribes for home use. This includes wheelchairs, walkers, hospital beds, oxygen equipment, blood sugar monitors, and nebulizers. You pay 20% of the Medicare-approved amount after the deductible.
Example: Gloria, age 75, has COPD and needs home oxygen therapy. Her doctor prescribes a portable oxygen concentrator. Part B covers the rental cost at 80% after the deductible. Gloria pays 20% coinsurance each month on the rental.
Medicare requires specific arterial blood gas or oximetry test results to approve home oxygen. An ABG-PO2 at or below 55, or oxygen saturation at or below 88%, is needed to establish coverage. Failing to get proper documentation is one of the most common reasons oxygen claims get denied.
Mental Health Services
Part B covers outpatient mental health care, including visits with psychiatrists, clinical psychologists, and clinical social workers. Individual and group therapy, psychiatric evaluations, and medication management are all included. Depression screenings are covered once per year at no cost as a preventive benefit.
Ambulance Services
Part B pays for ambulance transportation when other forms of transport would endanger your health. Both emergency and some non-emergency ambulance services are covered, though non-emergency rides typically require a doctor’s written order stating that ambulance transport is medically necessary.
Therapies and Rehabilitation
Physical therapy, occupational therapy, and speech-language pathology services are all covered under Part B. A major win for seniors came in 2018 when the Bipartisan Budget Act permanently repealed the therapy payment caps that had limited annual coverage.
Medicare also covers therapy to maintain function — not just to improve it — under the landmark Jimmo v. Sebelius settlement. This means your coverage can’t be denied simply because you aren’t expected to get better.
Insulin and Part B Drug Coverage
Part B generally does not cover prescription drugs you take at home. Those fall under Part D. But it does cover drugs that cannot be self-administered and must be given by a doctor or in a clinical setting — like chemotherapy infusions, certain injected medications, and some antigens.
For insulin users, Part B caps the cost of a month’s supply of insulin for a pump at $35, with no deductible applied. A 3-month supply costs no more than $105 total.
Opioid Use Disorder Treatment
Starting in 2020, Part B covers Opioid Treatment Programs (OTPs) through bundled payments. Covered services include FDA-approved medication-assisted treatment, substance use counseling, individual and group therapy, and toxicology testing.
Preventive Services Covered at No Cost
One of Part B’s biggest benefits is free preventive care. When you see a provider who accepts assignment, you pay nothing — no deductible, no coinsurance — for dozens of screenings and services.
Here are the key preventive services covered:
- “Welcome to Medicare” preventive visit — a one-time exam within 12 months of enrolling in Part B
- Annual Wellness Visit — a yearly health planning visit (different from a physical exam)
- Mammograms — annual screening for women age 40 and older
- Colorectal cancer screening — includes colonoscopies, fecal-occult blood tests, and flexible sigmoidoscopy
- Cardiovascular disease screenings — cholesterol and lipid panel every 2 years
- Diabetes screenings — up to twice per year for high-risk individuals
- Bone mass measurements — for estrogen-deficient women and others at high risk for osteoporosis
- Prostate cancer screening — annual PSA blood test and digital rectal exam for men over 50
- Glaucoma screening — for those with diabetes or a family history
- Flu, pneumonia, and Hepatitis B shots — covered at no cost
- Depression screening — once per year
- HIV screening — for those at increased risk and anyone who voluntarily requests it
- Tobacco cessation counseling — up to 8 sessions per year
- Alcohol misuse screening and counseling
- Abdominal aortic aneurysm screening — one-time ultrasound with referral from the Welcome to Medicare visit
Example: James, age 66, just enrolled in Part B. Within his first 12 months, he gets his Welcome to Medicare visit, a colonoscopy, a flu shot, and a cardiovascular screening — all at zero cost because his doctor accepts assignment.
What Part B Does NOT Cover
Part B has important exclusions. The following items and services are excluded from coverage:
- Routine dental care — cleanings, fillings, dentures, and extractions
- Routine eye exams — exams for prescribing eyeglasses or contact lenses
- Eyeglasses and contact lenses — except one pair of standard frames after cataract surgery with an intraocular lens
- Hearing aids and hearing exams — for the purpose of fitting hearing aids
- Most prescription drugs — those you take at home (covered under Part D instead)
- Cosmetic surgery — unless needed to repair an accidental injury or improve a malformed body part
- Routine foot care — nail trimming and callus removal in most cases
- Custodial or long-term care — help with daily activities like bathing and dressing
- Care outside the U.S. — with very limited exceptions
2026 Part B Costs: Premiums, Deductibles, and Coinsurance
Understanding Part B costs is critical for budgeting your retirement health expenses.
| Cost Component | 2026 Amount |
|---|---|
| Standard monthly premium | $202.90 |
| Annual deductible | $283 |
| Coinsurance (after deductible) | 20% of Medicare-approved amount |
| 2025 standard premium (for comparison) | $185.00 |
| 2025 annual deductible (for comparison) | $257 |
The Part B premium increased by $17.90 per month from 2025 to 2026. The deductible rose by $26. There is no annual out-of-pocket maximum in Original Medicare, which means your 20% coinsurance is unlimited.
IRMAA: The High-Income Surcharge
If your modified adjusted gross income exceeds certain thresholds, you’ll pay an Income-Related Monthly Adjustment Amount (IRMAA) on top of the standard premium. The 2026 IRMAA brackets are based on your tax return from two years prior.
| Income (Single Filer) | Total Monthly Part B Premium |
|---|---|
| $109,000 or less | $202.90 |
| $109,001 – $137,000 | $284.10 |
| $137,001 – $171,000 | $405.40 |
| $171,001 – $205,000 | $527.50 |
| $205,001 – $499,999 | $649.20 |
| $500,000 or more | $689.90 |
IRMAA surcharges range from $81.20 to $487.00 above the standard premium. A life-changing event — like retirement, divorce, or the death of a spouse — can qualify you for an IRMAA reconsideration using a more recent tax year.
Part B Excess Charges: The Hidden Cost
When a doctor does not accept assignment, they can charge up to 115% of the Medicare-approved amount. That extra 15% is called a Part B excess charge, and you pay it entirely out of pocket.
Example: Dr. Smith does not accept assignment. His fee is $600, but the Medicare-approved amount is $349.37. Federal law limits his total bill to $401.89 (115% × $349.37). Medicare pays $279.50 (80% of $349.37). You owe $122.39 — the 20% coinsurance plus the excess charge.
States That Ban Excess Charges
Eight states prohibit providers from billing Part B excess charges:
- Connecticut
- Massachusetts
- Minnesota
- New York
- Ohio
- Pennsylvania
- Rhode Island
- Vermont
If you live and receive care in one of these states, you are protected from excess charges. This protection does not extend to care received out of state from a non-participating provider.
The Part B Late Enrollment Penalty
Missing your enrollment window triggers a permanent penalty. You’ll pay an extra 10% of the standard premium for every full 12-month period you could have had Part B but didn’t sign up. This penalty lasts as long as you have Medicare.
| Years Delayed | Penalty Percentage | 2026 Monthly Premium with Penalty |
|---|---|---|
| 1 year | 10% | $223.19 |
| 2 years | 20% | $243.50 |
| 3 years | 30% | $263.77 |
| 5 years | 50% | $304.35 |
Example: Tom turned 65 in 2023 but didn’t sign up for Part B because he thought he didn’t need it. He had no employer coverage and no Special Enrollment Period. In 2026, when he finally enrolls, he’ll pay a 20% penalty — $40.58 added to his monthly premium — for the rest of his life.
You can avoid the penalty if you qualify for a Special Enrollment Period because you had creditable employer coverage, or if you’re enrolled in a Medicare Savings Program.
How Medigap Interacts with Part B
Medicare Supplement Insurance (Medigap) is specifically designed to fill Part B’s cost gaps. Medigap plans pay some or all of your 20% coinsurance, the annual deductible, and Part B excess charges depending on the plan you choose.
Medigap Plan G is the most popular plan sold today. It covers 100% of Part B coinsurance, Part B excess charges, and foreign travel emergencies — but it does not cover the $283 annual Part B deductible. Medigap Plan F covered the deductible but is no longer available to anyone who became newly eligible for Medicare after January 1, 2020.
If you use an insulin pump, your Medigap plan should also cover the $35 or less copay for Part B-covered insulin.
How Medicare Advantage Interacts with Part B
Medicare Advantage (Part C) is an alternative to Original Medicare offered by private insurers. You still pay your Part B premium, but the Advantage plan replaces Original Medicare and often bundles Part A, Part B, and Part D into a single plan with additional benefits like dental, vision, and hearing.
| Original Medicare + Part B | Medicare Advantage (Part C) |
|---|---|
| No annual out-of-pocket cap | Annual out-of-pocket maximum required by law |
| See any Medicare-accepting provider nationwide | Typically limited to in-network providers |
| 20% coinsurance with no limit | Fixed copays for many services |
| No drug coverage (need Part D separately) | Usually includes Part D drug coverage |
Medicare Advantage plans must cover at least everything Part B covers. They cannot offer less. But they can impose different cost-sharing rules, prior authorization requirements, and network restrictions.
Prior Authorization Changes Coming in 2026
CMS is launching a prior authorization pilot program for Traditional Medicare starting January 1, 2026. This is a significant shift — Original Medicare has historically not required prior authorization for most services.
The pilot runs from 2026 through 2031 in six states: Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington. It covers 17 outpatient procedures including certain orthopedic, neurological, and skin-related treatments.
Medicare Advantage plans are also subject to new transparency and speed requirements for prior authorization decisions in 2026. Urgent requests must be decided within 24 hours, and standard requests within 7 days.
Part B Pros and Cons
| Pros | Cons |
|---|---|
| Covers dozens of preventive services at $0 | No annual out-of-pocket cap on spending |
| See any Medicare-accepting doctor nationwide | 20% coinsurance is unlimited |
| Covers medically necessary DME for home use | Does not cover dental, vision, or hearing aids |
| $35 monthly cap on insulin for pump users | Premiums increase each year ($202.90 in 2026) |
| No network restrictions under Original Medicare | Excess charges up to 15% from non-participating doctors |
| Therapy caps permanently repealed since 2018 | IRMAA surcharges for higher-income beneficiaries |
Mistakes to Avoid with Medicare Part B
1. Missing your Initial Enrollment Period (IEP). Your IEP is the 7-month window around your 65th birthday. Missing it without creditable employer coverage triggers the 10%-per-year lifetime penalty. There is no forgiveness and no way to remove it once applied.
2. Assuming employer coverage always counts as creditable. COBRA, retiree health plans, and VA benefits do not count as creditable coverage for avoiding the Part B penalty. Only active employer group health plans from an employer with 20 or more employees qualify.
3. Confusing “observation status” with inpatient admission. If the hospital places you under observation, your stay is billed under Part B — not Part A. You’ll owe 20% coinsurance instead of the Part A deductible, and you won’t qualify for Medicare-covered skilled nursing facility care afterward.
4. Not checking if your doctor accepts assignment. A doctor who doesn’t accept assignment can bill up to 115% of the Medicare-approved amount. Always ask before your appointment whether the provider accepts Medicare assignment to avoid surprise excess charges.
5. Skipping free preventive services. Many seniors don’t realize that Part B covers annual wellness visits, cancer screenings, flu shots, and depression screenings at zero cost. Skipping these means missing early detection opportunities that could save your life — and your wallet.
6. Failing to document medical necessity for DME. Medicare denies oxygen therapy and other DME claims when the required lab results or physician documentation is missing. Always make sure your doctor provides the specific clinical evidence Medicare requires before ordering equipment.
7. Not appealing denied claims. Medicare denials can be overturned. The Center for Medicare Advocacy notes that many therapy and equipment denials are reversed on appeal. Beneficiaries have the right to five levels of appeal, and the process costs nothing to initiate.
Do’s and Don’ts for Part B Beneficiaries
| Do | Don’t |
|---|---|
| Enroll during your IEP or Special Enrollment Period to avoid penalties | Don’t assume COBRA counts as creditable coverage |
| Choose doctors who accept Medicare assignment to avoid excess charges | Don’t ignore “observation status” notices at the hospital |
| Get all your $0 preventive screenings every year | Don’t wait to sign up because you “feel healthy” |
| Appeal any claim denial — many are overturned | Don’t throw away your Explanation of Medicare Benefits statements |
| Consider Medigap to cover the 20% coinsurance gap | Don’t confuse Part B drug coverage with Part D |
| File for IRMAA reconsideration after a life-changing event | Don’t assume your premium is permanently high after an income spike |
Three Common Part B Scenarios
Scenario 1: Routine Doctor Visit with Lab Work
Maria, age 70, visits her primary care doctor for a checkup and gets blood work done.
| What Happens | What Maria Pays |
|---|---|
| Doctor charges $250; Medicare-approved amount is $200 | 20% of $200 = $40 (after deductible is met) |
| Lab work performed at a Medicare-participating lab | $0 — clinical lab tests covered at 100% |
| Doctor accepts assignment | No excess charges |
Scenario 2: Outpatient Knee Surgery
Bill, age 73, gets outpatient arthroscopic knee surgery at an ambulatory surgical center.
| What Happens | What Bill Pays |
|---|---|
| Surgeon fee: Medicare-approved amount is $1,500 | 20% of $1,500 = $300 (after deductible) |
| Facility fee: Medicare-approved amount is $2,000 | 20% of $2,000 = $400 |
| Post-op physical therapy, 12 sessions | 20% of each session’s approved amount |
| Total estimated out-of-pocket (without Medigap) | $700+ before therapy costs |
Scenario 3: Durable Medical Equipment — Wheelchair
Helen, age 80, needs a power wheelchair due to mobility limitations from arthritis.
| What Happens | What Helen Pays |
|---|---|
| Doctor documents medical necessity and writes prescription | Required before Medicare will cover |
| Medicare-approved amount for the wheelchair: $3,000 | 20% = $600 after deductible |
| Wheelchair must be from a Medicare-enrolled supplier | Using a non-enrolled supplier means $0 coverage |
FAQs
Does Part B cover dental work?
No. Part B excludes routine dental care like cleanings, fillings, extractions, and dentures. Only non-routine dental tied to a medical condition may get limited coverage after appeal.
Does Part B cover prescription drugs?
No. Part B does not cover self-administered drugs taken at home. Those require Part D. Part B only covers drugs administered by a provider in a clinical setting, like chemotherapy infusions.
Is the Part B late enrollment penalty permanent?
Yes. The 10%-per-year penalty is added to your monthly premium for as long as you have Medicare. It cannot be removed or reduced.
Does Part B cover hearing aids?
No. Medicare excludes hearing aids and exams to fit them. Some Medicare Advantage plans offer hearing aid benefits, but Original Medicare Part B does not.
Are annual physicals covered?
No. Part B does not cover routine physical exams. It covers an Annual Wellness Visit, which is a health planning session — not a head-to-toe physical examination.
Can I avoid the IRMAA surcharge?
Yes. If you’ve had a qualifying life-changing event like retirement or divorce, you can file Form SSA-44 to request that Social Security use a more recent tax year.
Does Part B cover ambulance rides?
Yes. Part B covers emergency ambulance services and some non-emergency rides when your doctor certifies other transport would endanger your health.
Is there an out-of-pocket maximum for Part B?
No. Original Medicare Part B has no annual cap on spending. Your 20% coinsurance is unlimited, which is why many seniors buy Medigap plans.
Does Part B cover eye exams?
No. Part B does not cover routine eye exams or eyeglasses. It does cover glaucoma screenings for those at risk and one pair of eyeglasses after cataract surgery.
Will Part B cover my COVID-19 vaccine?
Yes. Part B covers COVID-19 vaccines at no cost to the beneficiary when administered by an in-network provider who accepts assignment.
Related reading
- Can I Deduct Medicare Part B Premiums On My Taxes? + FAQs
- How Do Medicare Supplement Plans Work (w/Examples) + FAQs
- Are Medicare Part B Premiums Paid in Advance? (w/Examples) + FAQs
- Should I Enroll in Medicare Part D? (w/Examples) + FAQs
- Do I Really Need Supplemental Insurance with Medicare? (w/Examples) + FAQs
- What Happens If You Don’t Have Supplemental Insurance? (w/Examples) + FAQs
- Is Nationwide Long-Term Care Insurance Worth It? (w/Examples) + FAQs