Medicare Terms Explained for Washington Residents
If Medicare terminology has ever slowed you down, this page is for you. These are the terms that come up most often in consultations with Washington residents turning 65 or already enrolled in Medicare. Defined as simply as possible.
Annual Enrollment Period (AEP)
The period from October 15 through December 7 each year when people already enrolled in Medicare can switch plans, change from Original Medicare to Medicare Advantage, or adjust their Part D drug coverage. Changes take effect January 1.
Benefit Period
A Medicare measurement used to calculate hospital coverage. A benefit period begins when you are admitted to a hospital and ends when you have not received inpatient hospital or skilled nursing care for 60 consecutive days. There is no limit to the number of benefit periods in Original Medicare.
COBRA
Continuation coverage that allows employees to keep their employer health insurance after leaving a job by paying the full premium. COBRA does not count as creditable coverage for Medicare Part B. The Medicare 8-month Special Enrollment Period runs from the date employment ends, not when COBRA expires.
COLA (Cost-of-Living Adjustment)
An annual adjustment to Social Security benefits based on the Consumer Price Index. The 2026 COLA was 2.8%, adding approximately $56 per month for the average beneficiary. Part B premiums increased 9.7% in the same year, consuming approximately $18 of that increase before it reached beneficiaries.
Community Rating (Washington State)
Washington State law that requires Medicare Supplement insurers to charge all enrollees the same premium for the same plan, regardless of age. A 65-year-old and a 75-year-old pay the same monthly premium for the same plan at the same carrier. This is unique to Washington and a small number of other states.
Creditable Coverage
Health insurance coverage that is at least as good as Medicare, which allows you to delay Medicare enrollment without incurring a late enrollment penalty. Active employer coverage from an employer with 20 or more employees is creditable for Part B. COBRA, retiree coverage, and PEBB continuation coverage are not creditable for Part B.
Formulary
The list of prescription drugs covered by a Medicare Part D or Medicare Advantage drug plan. Formularies vary significantly between plans. The same drug can be in a lower cost tier on one plan and a higher cost tier — or not covered at all — on another. Formularies can change annually.
Guaranteed Issue
A right that requires insurance carriers to sell a Medicare Supplement policy without asking health questions or denying based on medical history. Guaranteed issue rights are triggered by specific events such as a Medicare Advantage plan cancellation, reaching the end of a trial period, or moving out of a plan's service area.
Hold Harmless Provision
A Social Security rule that prevents your net Social Security check from decreasing due to a Medicare Part B premium increase. It protects your payment from dropping year over year because of premium increases, but it does not apply to Medicare Advantage premiums, Medigap premiums, IRMAA surcharges, or if you pay your Part B premium separately from Social Security.
Initial Enrollment Period (IEP)
The 7-month window around your 65th birthday when you can first enroll in Medicare without a penalty. It starts 3 months before your birthday month, includes your birthday month, and ends 3 months after. Missing this window without qualifying coverage creates a permanent late enrollment penalty.
IRMAA (Income-Related Monthly Adjustment Amount)
A federal surcharge added to Medicare Part B and Part D premiums for higher-income beneficiaries. In 2026, IRMAA applies to individuals with income above $109,000 or couples above $218,000, based on income from two years prior. Part B premiums with IRMAA range from $284.10 to $689.90 per month in 2026.
Late Enrollment Penalty
A permanent increase to your Medicare Part B premium for each 12-month period you were eligible but did not enroll. In 2026, the penalty is 10% added to the $202.90 base premium for each year of delay. The penalty never goes away.
Medicare Advantage (Part C)
A private insurance alternative to Original Medicare that combines Parts A, B, and usually D in one plan. Medicare Advantage plans use provider networks and require prior authorization for many services. Many plans have $0 monthly premiums but can have out-of-pocket maximums up to $8,850 in 2026.
Medicare Supplement (Medigap)
Private insurance that fills the gaps in Original Medicare coverage — paying deductibles, coinsurance, and copays. Medicare Supplement plans are standardized by the federal government. Plan G and Plan N are the most common in Washington State.
Medigap
Another name for Medicare Supplement insurance. Medigap policies fill the gaps in Original Medicare coverage. They are sold by private insurance companies and are standardized by the federal government — Plan G is Plan G regardless of which company sells it. In Washington, Medigap premiums are community rated.
MOOP (Maximum Out-of-Pocket)
The maximum amount you pay in covered medical costs in a year before the plan covers 100% of covered services. Medicare Advantage plans have a MOOP of up to $8,850 for in-network care in 2026. Original Medicare alone has no out-of-pocket maximum — a Medicare Supplement plan provides this protection instead.
Original Medicare
The federal Medicare program consisting of Part A (hospital) and Part B (medical). Original Medicare allows beneficiaries to see any provider in the country that accepts Medicare, without referrals or network restrictions. It pays approximately 80% of approved costs. Most people add a Supplement plan or Medicare Advantage plan to cover remaining costs.
Medicare Part A
The hospital insurance portion of Medicare. Part A covers inpatient hospital stays, skilled nursing facility care (up to 100 days after a qualifying hospital stay), hospice care, and some home health care. Part A is free for most people who paid Medicare taxes for at least 10 years. The Part A deductible in 2026 is $1,736 per benefit period.
Medicare Part B
The medical insurance portion of Medicare. Part B covers doctor visits, outpatient care, preventive services, durable medical equipment, and most non-hospital services. The standard Part B premium in 2026 is $202.90 per month. Part B is required for Medicare Supplement plans and Medicare Advantage.
Medicare Part B Premium
The monthly cost of Medicare Part B, which covers doctor visits and outpatient care. The standard 2026 Part B premium is $202.90 per month. Higher-income beneficiaries pay more through IRMAA surcharges. The premium is automatically deducted from Social Security checks for most enrollees.
Medicare Part D
Prescription drug coverage available as a standalone plan or included in many Medicare Advantage plans. Part D plans vary significantly in which drugs they cover and at what cost. In 2026, the annual out-of-pocket maximum for Part D is $2,100. Average standalone Part D premiums are approximately $30-$50 per month in Washington.
PEBB (Public Employees Benefits Board)
Washington State's benefits program for state and public employees including teachers, county workers, and state government staff. PEBB continuation coverage after retirement follows the same Medicare rules as COBRA — it is not creditable coverage for Medicare Part B and does not extend the 8-month Medicare enrollment window.
Medicare Supplement Plan G
The most comprehensive Medicare Supplement plan available to people new to Medicare. Plan G covers almost everything Original Medicare does not. The only out-of-pocket expense is the Part B deductible ($240 in 2026). In Washington, Plan G premiums range from $230 to $350 per month depending on the carrier.
Medicare Supplement Plan N
A Medicare Supplement plan that offers strong coverage at a lower monthly premium than Plan G. Plan N has small copays for doctor visits (up to $20) and emergency room visits (up to $50). In Washington, Plan N premiums range from $170 to $250 per month depending on the carrier.
Prior Authorization
A requirement that insurance carriers approve certain medical services before they are performed. Medicare Advantage plans use prior authorization extensively. Original Medicare uses it only in limited circumstances. The WISeR federal pilot program added prior authorization requirements for 17 specific procedures under Original Medicare in Washington State beginning January 2026.
Right to Change (Washington State)
Washington State law that allows Medicare Supplement enrollees to switch to a different carrier offering the same plan letter at any time of year, without medical underwriting. No health questions are asked. The carrier must accept the application. This applies to enrollees already on a Supplement plan — it does not apply to people switching from Medicare Advantage to a Supplement for the first time.
Special Enrollment Period (SEP)
An enrollment window outside of the standard Initial Enrollment Period, triggered by specific life events such as losing employer coverage, moving, or a plan being cancelled. For Medicare Part B, the SEP after losing employer coverage is 8 months.
Form SSA-44
A Social Security form used to appeal an IRMAA Medicare surcharge based on a qualifying life-changing event such as retirement. If your income dropped significantly after the year Medicare uses for calculation, filing SSA-44 can result in your premium being recalculated using your current lower income.
WA Cares Fund
Washington State's public long-term care insurance program, the first of its kind in the United States. Workers contribute 0.58% of wages. Benefits of up to $36,500 lifetime began July 1, 2026. The benefit can be used for in-home care, assisted living, or nursing home costs. At Washington nursing home rates of over $13,000 per month, $36,500 covers approximately 2-3 months of care.
WISeR (Wasteful and Inappropriate Services Reduction)
A federal prior authorization pilot program that added approval requirements for 17 outpatient procedures under Original Medicare in Washington State and five other states, effective January 2026. Covered procedures include epidural steroid injections and certain spinal surgeries. Current wait times at Washington hospitals run 4 to 8 weeks.