There is a dangerous myth that once you turn 65, your healthcare becomes free. You get the red, white, and blue card, and you assume the bills stop. The reality is that Medicare is a safety net with holes in it.
It was never designed to cover everything, and the gaps are where your retirement savings can drain away. If you aren’t prepared for the specific costs that Medicare explicitly excludes, you are going to be blindsided by invoices that no insurance company is coming to pay.
1. The “Part B” Premium is not optional
Many people are shocked to see a deduction from their Social Security check before it even hits the bank. In 2026, the standard Part B premium is nearly $185/month. If you don’t take Social Security yet, you get a bill. You have to pay this just to have access to doctors; it is not free coverage.
2. The Dental/Vision/Hearing void
Original Medicare covers none of the “big three” of aging: teeth, eyes, and ears. Need a root canal? That’s on you. Need hearing aids? That’s $4,000 out of pocket. Need glasses? Full price. These are standard maintenance issues for seniors, yet they are financially invisible to Medicare.
3. The “Donut Hole” (Coverage Gap)
While the Inflation Reduction Act helped, the coverage gap in Part D prescription plans still exists in a new form. Once you and your plan spend a certain amount on drugs, your cost-sharing can change. You might walk to the pharmacy counter in October and find your usual $20 copay is suddenly $150.
4. IRMAA Surcharges
If you earned a good living two years ago, you will be penalized for it today. The Income-Related Monthly Adjustment Amount (IRMAA) is a surcharge added to your premiums if your income is over a certain threshold (approx. $103k for singles). Selling a house or taking a large capital gain can trigger this, doubling your Medicare costs for a year.
5. Long-Term Care
This is the bankruptcy maker. Medicare pays for “rehabilitation” (up to 100 days), not “custodial care.” If you need help bathing, dressing, or eating due to dementia or frailty, Medicare pays exactly $0. At $8,000 a month for a nursing home, this is the cost that wipes out estates.
6. The Part A Deductible (It resets!)
Unlike your car insurance deductible which is annual, the Part A hospital deductible (over $1,600) applies *per benefit period*. If you go to the hospital in January, go home for 60 days, and go back in April, you pay that deductible again. It can hit you multiple times a year.
7. “Excess Charges”
Doctors who do not accept “Medicare assignment” are allowed to charge you 15% *more* than the Medicare-approved amount. Medicare won’t pay this. You have to pay this 15% surcharge entirely out of pocket unless you have a specific Medigap plan (Plan G or F) that covers it.
8. Foreign Travel
If you plan to spend your retirement traveling Europe, know this: Medicare stops at the border. If you have a heart attack in Paris, Medicare pays nothing. You are effectively uninsured the moment you leave the U.S. unless you buy a supplement with a foreign travel rider.
9. Observation Status
You can spend three days in a hospital bed and not be “admitted.” If the hospital classifies you as “under observation” (outpatient) rather than “inpatient,” Medicare Part A doesn’t kick in for skilled nursing rehab later. You could be stuck with a $20,000 rehab bill because of a paperwork classification.
10. The 20% Co-Insurance
Under Original Medicare Part B, you pay 20% of the cost of services, with *no cap*. If you have a $100,000 surgery, your share is $20,000. There is no “out-of-pocket maximum” in Original Medicare, which is why supplemental insurance is virtually mandatory.
Budget for the Gaps
Medicare is a foundation, not the whole house. You need to build the rest of the structure with Medigap, savings, or a clear understanding of what you will self-insure.
Which of these costs surprised you the most? Let’s warn others in the comments.
What to Read Next…
- Medicare 2026: The New $2,000 Out-of-Pocket Cap on Prescription Drugs Explained
- 10 Things Medicare Doesn’t Cover (That Will Shock You)
- How Long-Term Injuries Can Derail Retirement Plans—and How to Recover
The post 10 Medicare Costs That Surprise People After They Turn 65 appeared first on Budget and the Bees.
