Comparing Medicare plans in Colorado
Original Medicare is the foundational federal health insurance program for Americans aged 65 and older, as well as for certain younger individuals with qualifying disabilities. It is administered entirely by the federal government and is composed of two distinct halves: Medicare Part A, which covers inpatient hospital care, and Medicare Part B, which covers outpatient medical services like doctor visits and preventive care.
If you are approaching Medicare eligibility in Colorado, understanding how Original Medicare works is the mandatory first step to securing your healthcare. Original Medicare provides robust, nationwide coverage that allows you to see almost any doctor in the country. However, it is not a complete, standalone solution for most people. It leaves critical gaps—most notably, it does not cover retail prescription drugs, it does not cover routine dental or vision care, and it leaves you financially responsible for 20% of your medical bills with absolutely no annual limit on your out-of-pocket costs.
Because of these significant financial exposures, deciding to take Original Medicare is only half of the retirement healthcare equation. You must also understand how its coverage gaps function so you can decide how to fill them.
Medicare Part A serves as your inpatient hospital insurance. If you are admitted to a traditional hospital, a critical access hospital, or an inpatient rehabilitation facility, Part A is the coverage that activates to pay for the room, your meals, general nursing, and the drugs you are given while admitted.
For the vast majority of Coloradans, Medicare Part A is premium-free. If you or your spouse have worked and paid Medicare taxes for at least 40 quarters (10 years) over your lifetime, you will not pay a monthly premium for Part A. If you have fewer than 40 quarters of work history, you can still buy into Part A, but you will pay a monthly premium scaled to how many quarters you actually accrued.
While Part A covers inpatient hospital stays, it also covers three other specific types of care:
Skilled Nursing Facility (SNF) Care: If you require specialized nursing care or rehabilitation after a hospital stay, Part A covers a stay in a skilled nursing facility. However, the rules are incredibly strict. To qualify, you must have an inpatient hospital stay lasting at least three consecutive days before your admission to the SNF. Once admitted, Part A covers the first 20 days in full. For days 21 through 100, you are responsible for a daily coinsurance amount. After 100 days, Part A stops paying entirely, and you cover all costs.
Hospice Care: If a doctor certifies that an individual has a terminal illness with a life expectancy of six months or less, Part A covers hospice care. This includes pain relief and symptom management, medical equipment, and grief counseling for the family. Hospice care can be provided in the home, in a facility, or in an inpatient setting.
Home Health Care: If you are homebound and need part-time or intermittent skilled nursing care, physical therapy, or speech-language pathology, Part A can cover these services. This does not cover 24-hour care, nor does it cover custodial care—services like help bathing, dressing, or eating.
One of the most complex elements of Medicare Part A is how it calculates your deductible. In standard commercial health insurance, a deductible is an annual figure. You meet it once, and the insurance pays for the rest of the year.
Medicare Part A does not use an annual deductible; it uses a “benefit period” deductible. A benefit period begins the day you are admitted to a hospital or skilled nursing facility as an inpatient. The benefit period ends when you have not received any inpatient hospital care or skilled care in an SNF for 60 consecutive days.
If you go into the hospital in February, you pay the Part A deductible. If you are discharged and stay out of the hospital for 60 days, but then are admitted again in September, a new benefit period begins. You will have to pay the exact same Part A deductible a second time in the same year. There is no limit to the number of benefit periods you can have.
Furthermore, if a single hospital stay extends beyond 60 days, you face severe daily copayments. Days 1 through 60 are covered by your deductible. For days 61 through 90, you pay a steep daily coinsurance charge. If your stay extends beyond 90 days, you tap into your “lifetime reserve days,” which carry an even higher daily coinsurance. You only have 60 lifetime reserve days; once they are used up, you are responsible for the entire cost of your hospitalization.
A critical mechanism that catches many patients off guard is the distinction between inpatient admission and observation status. You can be physically placed in a hospital bed, receive nursing care, undergo tests, and stay overnight for days, but still technically be classified as an “outpatient under observation” rather than a formally admitted inpatient.
Because Part A only covers inpatient stays, observation status falls under Medicare Part B. The practical consequence of this is twofold. First, your hospital stay will be billed under Part B’s rules (the deductible and 20% coinsurance). Second, and more importantly, because you were not formally admitted as an inpatient for three days, you will not qualify for Medicare Part A to cover a subsequent stay in a Skilled Nursing Facility. You would have to pay for the rehabilitation facility entirely out of pocket.
If Part A is your hospital insurance, Medicare Part B is your day-to-day medical insurance. It covers the services and supplies that are medically necessary to diagnose or treat your health conditions, as well as preventive care to keep you healthy.
Every individual enrolled in Part B pays a monthly premium. For most beneficiaries, this standard monthly premium is automatically deducted from their Social Security, Railroad Retirement Board, or Office of Personnel Management benefit checks. If you are not yet collecting Social Security when you enroll in Medicare, you will receive a quarterly bill from Medicare directly.
Part B covers a vast array of services, including:
The cost-sharing structure of Part B is entirely different from Part A. Part B operates on an annual deductible. At the beginning of the calendar year, you must pay this deductible out of pocket before Medicare begins its share of the cost for most services.
Once the annual deductible is met, Original Medicare generally pays 80% of the Medicare-approved amount for the service you received. You are responsible for the remaining 20% coinsurance.
Crucially, there is no limit on this 20% coinsurance. If you receive a devastating diagnosis requiring a $200,000 course of outpatient chemotherapy, Part B covers 80%, but you are strictly liable for the remaining $40,000. If you require continuous, expensive outpatient treatments over a multi-year span, you will pay 20% of the cost every single time. This open-ended financial risk is the primary reason the overwhelming majority of Medicare beneficiaries secure additional coverage to cap their expenses.
While most people pay the standard Part B premium, higher-income beneficiaries pay more due to the Income-Related Monthly Adjustment Amount, or IRMAA.
IRMAA is a surcharge added to your Part B (and Part D) premium based on your Modified Adjusted Gross Income (MAGI). The federal government looks at your tax return from two years prior to determine your current year’s premium. If your income exceeds certain statutory thresholds, you will be placed into one of several higher premium brackets. This surcharge applies uniformly regardless of where you live in Colorado; it is a federal calculation. If your income drops significantly due to retirement, marriage, or the loss of a spouse, you can appeal your IRMAA bracket with the Social Security Administration.
When you see a doctor under Part B, the cost depends heavily on the doctor’s relationship with the Medicare program.
Participating Providers: These doctors accept “Medicare assignment.” This means they agree to accept the Medicare-approved amount as payment in full for their services. You pay your 20% coinsurance, and the doctor cannot bill you for the rest. This is the safest and most common arrangement.
Non-Participating Providers: These doctors accept Medicare patients but do not formally accept assignment on all claims. By federal law, they are allowed to charge up to 15% more than the Medicare-approved amount. This extra 15% is called a “limiting charge.” If you see a non-participating provider, you are responsible for your standard 20% coinsurance plus the additional 15% limiting charge.
Opt-Out Providers: Some doctors formally opt out of the Medicare program entirely. Medicare will pay nothing for the services you receive from an opt-out provider, and you will be responsible for the entire bill out of pocket, with no legal limit on what the doctor can charge you.
Understanding Original Medicare requires knowing exactly where the coverage stops. Because the program’s basic structure was designed in the 1960s, it excludes several vital categories of modern healthcare. Original Medicare does not cover:
| Feature | Original Medicare (Part A & B) | Medicare Advantage (Part C) | Original Medicare + Medigap + Part D |
|---|---|---|---|
| Provider Network | Any provider in the U.S. that accepts Medicare. | Usually restricted to an HMO or PPO network. | Any provider in the U.S. that accepts Medicare. |
| Prescription Drugs | Not covered. | Usually included in the plan. | Requires a separate standalone Part D plan. |
| Out-of-Pocket Maximum | No limit. You pay 20% of Part B indefinitely. | Yes. Federal law requires a strict annual cap. | Yes. The Medigap policy pays the 20% coinsurance. |
| Referrals Needed | No. You can see specialists directly. | Often required (especially in HMO plans). | No. You can see specialists directly. |
| Extra Benefits | None. | Often includes dental, vision, and hearing benefits. | Varies, but generally minimal extra benefits. |
Enrollment in Original Medicare is handled by the Social Security Administration, even though the program is managed by the Centers for Medicare & Medicaid Services (CMS). There are specific, rigid timeframes during which you are permitted to enroll. Missing these windows can result in lifetime financial penalties and dangerous gaps in your healthcare coverage.
If you are already receiving Social Security retirement benefits or Railroad Retirement Board benefits before you turn 65, you will be automatically enrolled in both Medicare Part A and Part B. Your red, white, and blue Medicare card will arrive in the mail about three months before your 65th birthday, and your coverage will begin on the first day of your birth month.
If you are not yet receiving Social Security benefits—which is increasingly common as the full retirement age pushes higher—you must manually apply for Medicare. You will not be enrolled automatically.
Your first opportunity to enroll in Original Medicare is your Initial Enrollment Period. This is a seven-month window built around your 65th birthday. It includes:
To ensure your coverage begins exactly on the first day of the month you turn 65, you must enroll during the three months leading up to your birthday. If you enroll during your birth month or the three months after, the start date of your coverage will be delayed.
You are eligible for Original Medicare in Colorado if you meet one of the following criteria:
Many Coloradans continue working well past age 65 and maintain health insurance through their employer. If you are actively employed and covered by an employer group health plan, the size of the company dictates your next steps.
Employers with 20 or more employees: If your company has 20 or more employees, your group health plan remains your primary coverage. You can safely delay enrolling in Medicare Part B without incurring any late enrollment penalties. (Most people still enroll in Part A since it is usually free). When you eventually retire or lose that employer coverage, you will trigger a Special Enrollment Period. You have an 8-month window starting the month after your employment ends or your group coverage ends (whichever happens first) to enroll in Part B without penalty.
Employers with fewer than 20 employees: If your company has fewer than 20 employees, Medicare automatically becomes the primary payer the moment you turn 65. Your small employer plan will drop to secondary status, meaning it will only pay what Medicare does not. If you fail to enroll in Part A and Part B in this scenario, your employer plan can legally refuse to pay your hospital and medical bills, acting as if Medicare had already paid its portion. You must enroll in Original Medicare during your IEP.
Note on COBRA and Retiree Coverage: Neither COBRA nor retiree health insurance is considered “active employer coverage” by Medicare. If you have COBRA, you are not protected from late penalties, and you must enroll in Medicare.
If you miss your Initial Enrollment Period and you do not qualify for a Special Enrollment Period, your only option is to sign up during the General Enrollment Period. The GEP runs from January 1 through March 31 every year. If you enroll during this window, your coverage will take effect on the first day of the month after you sign up.
However, relying on the General Enrollment Period means you will likely face late enrollment penalties.
Medicare aggressively penalizes individuals who fail to secure coverage when they are first eligible. These are not one-time fines; they are permanent surcharges added to your monthly premiums.
Because Original Medicare has no cap on out-of-pocket costs and provides no drug coverage, utilizing it on its own is dangerous. Beneficiaries must augment their coverage to protect their finances. You have two main pathways to do this.
Under this pathway, you keep Original Medicare as your primary insurance. To cover the 20% coinsurance and the deductibles, you purchase a Medicare Supplement Insurance policy, widely known as a Medigap plan, from a private insurance company.
Because Medigap plans are standardized by the federal government, a Plan G in Denver offers the exact same medical benefits as a Plan G in Ouray County. With a comprehensive Medigap plan, your financial exposure is heavily insulated. You can continue to see any doctor in the country who accepts Medicare, without needing referrals.
To solve the prescription drug gap, you must also purchase a standalone Medicare Part D plan.
Pros: Maximum flexibility, nationwide provider access, highly predictable out-of-pocket costs. Cons: You must pay three separate premiums (Part B, Medigap, and Part D), and Medigap premiums will rise as you age. Dental and vision are generally still not covered.
A Medicare Advantage plan essentially replaces the administrative structure of Original Medicare. Instead of the federal government paying your claims, a private insurance company—such as UnitedHealthcare, Anthem Blue Cross and Blue Shield, Humana, or Kaiser Permanente—contracts with Medicare to manage your care.
If you choose a Medicare Advantage plan, you still must pay your Part B premium to the federal government. However, the Advantage plan takes over providing all your Part A and Part B benefits. The massive draw of Medicare Advantage plans is that they bundle services: a single plan usually includes prescription drug coverage, establishes a strict annual out-of-pocket maximum, and often throws in extra benefits like routine dental, vision, hearing, and gym memberships.
In Colorado, there are over 100 different Medicare Advantage plans available across the state, ranging from the AARP Medicare Advantage Essentials from UHC to regional HMO offerings from Elevate or Select Health.
Pros: Often features a $0 additional premium, bundles drugs and extra benefits, limits your maximum financial exposure. Cons: You must use the plan’s specific network of doctors (usually an HMO or PPO). If you live in a rural area like Routt County, the network may be restrictive. You often need referrals to see specialists, and the plan may require prior authorization for certain treatments.
Compare Medicare Advantage, Medigap, and Part D options available in your specific Colorado ZIP code with the help of a licensed agent.
Get a Free ConsultationChoosing how to structure your Medicare coverage is one of the most consequential financial and medical decisions of your retirement. Original Medicare is a powerful, flexible bedrock of coverage, but its open-ended financial liabilities demand that you build upon it.
If you travel frequently, split your time between Colorado and another state, or prioritize having unhindered access to the best specialists across the country, retaining Original Medicare and insulating it with a Medigap policy provides unmatched freedom. You dictate your care, not an insurance company’s prior authorization department.
Conversely, if you prefer the convenience of bundled coverage, want dental and vision benefits without buying separate policies, and are comfortable receiving care within a defined local network in your area, transitioning your Original Medicare benefits into a Medicare Advantage plan is a highly effective, cost-contained strategy.
Evaluate your recurring prescription medications, verify the Medicare participation status of your preferred physicians, and calculate the total cost of premiums versus potential out-of-pocket exposure. Medicare is not a one-size-fits-all program, and the right configuration depends entirely on your personal healthcare needs.