Most Americans assume Medicare covers the big stuff and the bills will be manageable. The mistake at #1 on this list costs the average senior over $4,800 a year in unnecessary expenses, and almost nobody catches it until the damage is done. Don’t change a single thing about your coverage until you’ve read through to the end.
23. Missing the Part B Enrollment Window
Most people assume they’ll get a reminder in the mail when it’s time to sign up for Medicare Part B. They won’t. If you don’t enroll during your Initial Enrollment Period (the 7-month window around your 65th birthday), you get hit with a 10% penalty on your premium for every 12-month period you were eligible but didn’t sign up. That penalty is permanent. One retired school administrator from Indiana told me she’s been paying an extra $34/month for six years because nobody warned her.
22. Assuming Original Medicare Covers Dental, Vision, and Hearing
This one surprises almost everyone. Original Medicare (Parts A and B) does not cover routine dental cleanings, eye exams, glasses, hearing aids, or hearing exams. Zip. A single pair of hearing aids can run $3,000 to $7,000 out of pocket. Thousands of seniors discover this only when they’re already in the dentist’s chair. A Medigap policy or Medicare Advantage plan may cover some of it, but you have to actively choose one that does.
21. Not Comparing Part D Plans Every Year
Your Part D prescription drug plan’s formulary (the list of covered drugs) changes every single year. So does its pricing. If you don’t log into Medicare Plan Finder during Open Enrollment (October 15 – December 7), you could be paying $500 to $1,200 more per year than someone on a better plan with the same drugs. Most people set it and forget it. That’s an expensive habit.
20. Ignoring the IRMAA Surcharge
If your income is above a certain threshold, Medicare charges you extra for Parts B and D. This is called the Income-Related Monthly Adjustment Amount (IRMAA). For 2026, it kicks in at $103,000 for individuals. What most people don’t know: it’s based on your tax return from two years prior. If your income dropped recently (retirement, job loss, divorce), you can file a Life-Changing Event appeal and get the surcharge reduced. Most seniors never file it.
19. Choosing Medicare Advantage Without Reading the Network
Medicare Advantage plans often advertise $0 premiums, which sounds great until you need a specialist. Many plans have narrow networks, and if your preferred doctor or hospital is out of network, you could pay the full bill yourself. One couple in Arizona told me their cardiologist wasn’t covered by their new plan. The out-of-network bill for a cardiac procedure: $22,000. Always check the provider directory before you sign up.
18. Missing the Extra Help Program for Low-Income Seniors
The Medicare Extra Help program (also called the Low-Income Subsidy) can save eligible seniors up to $5,300 per year on Part D drug costs. Yet millions of Americans who qualify never apply. The income limit is higher than most people think: up to $22,590 for individuals in 2026. If you’re not sure whether you qualify, call your State Health Insurance Assistance Program (SHIP) and ask. It takes about 30 minutes and could save you real money.
17. Not Getting a Welcome to Medicare Preventive Visit
Within your first 12 months on Medicare Part B, you’re entitled to a one-time Welcome to Medicare preventive visit at no cost. Most seniors don’t know it exists. After that, you get a free Annual Wellness Visit every year, also at no charge. These visits help you set up a personalized prevention plan and catch problems early. Skipping them is essentially leaving free preventive care on the table every single year.
16. Letting a Medigap Open Enrollment Window Close
When you first enroll in Medicare Part B, you have a 6-month Medigap Open Enrollment Period where insurers cannot deny you coverage or charge you more because of pre-existing conditions. After that window closes, most states allow insurers to medically underwrite you. That means if you have diabetes, heart disease, or a history of cancer, you could be denied coverage entirely or charged significantly higher premiums. Miss this window and you may never get another shot at comprehensive supplement coverage at standard rates.
15. Thinking Medicare Covers Long-Term Care
This is one of the most expensive misunderstandings in retirement planning. Medicare does not cover custodial care, which is the kind of help you need in a nursing home or assisted living facility for bathing, dressing, and daily activities. Medicare only covers short-term skilled nursing care (and only after a 3-day hospital stay). The average cost of a private room in a nursing home is $105,000 per year. Without a long-term care insurance policy or Medicaid planning, that comes directly out of your savings.
Read More: 19 Retirement Expenses That Catch Americans Completely Off Guard
14. Not Understanding the Medicare Advantage Disenrollment Rules
Many seniors switch to Medicare Advantage thinking they can go back to Original Medicare anytime. That’s not entirely true. If you want to switch back to Original Medicare and add a Medigap supplement, you may not qualify medically depending on your state. And if you drop a Medigap plan to try Medicare Advantage and decide to return, insurers can now reject you if you’re in poor health. One wrong switch can permanently limit your options. Always talk to a SHIP counselor before making changes.
13. Paying Full Price for Prescription Drugs Without Checking GoodRx
Even with Part D coverage, some generic drugs are cheaper at retail price using GoodRx or a similar discount program than they are through your insurance. The catch: you usually can’t combine GoodRx with Part D in the same transaction. But for certain medications, paying cash with a GoodRx coupon can save $20 to $80 per prescription. Many seniors pay full insurance co-pays for years without ever checking whether a discount card would be cheaper. Always compare before you fill.
12. Not Appealing a Medicare Coverage Denial
Medicare denies millions of claims every year. What most people don’t know is that over 75% of appealed Medicare Advantage denials are eventually overturned. The same applies to Original Medicare. If a claim is denied, you have 120 days from the date of the notice to file a redetermination. Many seniors accept the denial and pay the bill. That’s often a $500 to $5,000 mistake. The appeal process is free and the success rate is high enough that it’s almost always worth trying.
11. Overlooking State Pharmaceutical Assistance Programs
In addition to federal programs, many states offer their own State Pharmaceutical Assistance Programs (SPAPs) that help seniors pay for prescription drugs. These programs have different names in different states, and they’re almost never advertised to Medicare beneficiaries. Some offer $1,500 to $3,000 per year in additional savings on top of federal Part D. If you live in New York, New Jersey, Pennsylvania, or about a dozen other states, there’s a program available right now that you may not be using.
10. Skipping Medication Therapy Management (MTM)
If you take multiple prescription drugs, you may qualify for Medicare’s Medication Therapy Management program at no extra cost. A licensed pharmacist or other health professional reviews all your medications to check for dangerous interactions, duplicates, and drugs you may no longer need. Studies show MTM participants save an average of $1,200 per year by eliminating unnecessary prescriptions and catching errors. Most eligible seniors have never been told this program exists.
Read More: 17 Medicare Advantage Traps That Cost Seniors Thousands
9. Ignoring the Medicare Savings Programs
The Medicare Savings Programs (MSPs) are four distinct programs that help low-to-moderate-income seniors pay for Medicare premiums, deductibles, and co-payments. The Qualified Medicare Beneficiary (QMB) program alone can eliminate virtually all your Medicare cost-sharing obligations. Yet nearly half of eligible seniors are not enrolled. The programs are administered through Medicaid, and many seniors wrongly assume they don’t qualify. A SHIP counselor can check your eligibility in one phone call.
8. Carrying the Wrong Medigap Plan
There are 10 standardized Medigap plans (A through N). Most seniors who buy a supplement choose Plan F or Plan G because their agent recommended it, or because they saw it advertised. But depending on your health status and typical healthcare use, a Plan N or Plan K could save you $800 to $1,500 per year in premiums with minimal extra out-of-pocket exposure. The right plan depends on how you actually use your coverage, not on which one sounds most comprehensive. An independent broker who specializes in Medicare is worth one hour of your time.
7. Not Coordinating Medicare With a Working Spouse’s Employer Plan
If you’re still covered under a spouse’s employer health insurance when you turn 65, you may be able to delay Part B enrollment penalty-free. This is called a Special Enrollment Period. But the rules are strict: the employer plan must be from current employment (not COBRA, retiree coverage, or a marketplace plan). Many seniors sign up for Part B anyway, paying $174.70 or more per month for duplicate coverage they don’t need. Others wait too long, triggering the penalty. Getting this coordination wrong costs hundreds of dollars every year.
6. Underestimating Medicare Out-of-Pocket Exposure
Original Medicare has no out-of-pocket maximum. That’s not a typo. Under Parts A and B, your costs are theoretically unlimited. If you’re hospitalized multiple times in a year, you pay the Part A deductible ($1,632 in 2026) for each benefit period. Seniors who choose Original Medicare without a Medigap supplement are one serious illness away from five-figure bills. This is the most dangerous structural gap in Medicare, and most beneficiaries don’t discover it until they’re already in a hospital bed.
5. Falling for Medicare Scams Targeting Seniors
Medicare fraud costs the program over $60 billion per year, and seniors are the primary targets. Common scams include calls offering free genetic testing, back braces, or medical equipment in exchange for your Medicare number. Once scammers have your Medicare ID, they bill Medicare for services never rendered. Your Medicare number is as sensitive as your Social Security number. Never give it out over the phone unless you initiated the call to a number you know is legitimate. Report suspected fraud to 1-800-MEDICARE or the HHS Office of Inspector General.
4. Not Understanding How Medicare Counts Hospital “Observation Status”
This one has blindsided thousands of seniors with massive unexpected bills. If a hospital places you under “observation status” instead of formally admitting you as an inpatient, Medicare counts your time there as outpatient care, even if you spend several nights. This means your stay doesn’t count toward the 3-day inpatient stay requirement for Medicare-covered skilled nursing care afterward. Seniors have left the hospital after multi-day stays and received bills for $20,000 to $40,000 in nursing facility costs that Medicare refused to cover. Always ask: “Am I admitted or under observation?”
3. Missing the Part D Catastrophic Coverage Threshold
The Threshold That Can Either Save You or Break You
Starting in 2026, the Medicare Part D out-of-pocket cap is $2,000, which is genuinely good news for people on expensive medications. But to hit that cap and get catastrophic coverage protection, your total drug spending (your costs plus what the plan pays) has to reach a separate threshold first. Many seniors don’t realize their specific drug plan’s structure can mean they never reach the threshold efficiently. Others don’t know about the Medicare Prescription Payment Plan, which lets you spread your $2,000 maximum over the entire calendar year in monthly payments instead of hitting it all at once. One retired engineer from Florida told me he was writing a $700 check in January before he knew this option existed. Understand how your plan counts toward the cap before January 1. The difference can be $1,200 to $1,800 in cash flow during the first quarter of the year.
Bad — but nothing compared to what’s waiting at #1.
2. Choosing Medicare Advantage to Save on Premiums and Ignoring the Lifetime Consequences
Medicare Advantage plans with $0 premiums are everywhere in the ads. They look like a great deal when you’re 65 and healthy. The problem is what happens when you’re 75, 78, or 82 and seriously ill. Many Medicare Advantage plans use prior authorization requirements that delay or deny care. Networks shrink as insurers cut contracts with providers. The plans that looked great at enrollment may not cover your preferred specialists a decade later. And if your health has declined, switching back to Original Medicare with a comprehensive Medigap supplement can be medically impossible in most states. The $0 premium plan you picked at 65 can lock you into an inferior care system for the rest of your life.
Bad — but nothing compared to what’s waiting at #1.
1. Not Maximizing the Annual Coordination Between Medicare, Social Security, and Your Tax Return
The Mistake That Costs the Average Senior $4,800 Per Year
Here’s what almost nobody tells you, and what most financial advisors only mention once if ever. Your Medicare premiums, your Social Security benefit amount, your modified adjusted gross income, and your tax filing strategy are all connected in a way that can cost or save you thousands of dollars every year. The IRMAA surcharges alone can add $860 to $5,392 per year to your Medicare costs if your income isn’t managed carefully. But the interaction runs deeper: Roth conversion timing, capital gains harvesting, and the way you take required minimum distributions can all push your income across IRMAA brackets. A retired accountant from Michigan told me she saved $4,200 in one year just by shifting a Roth conversion from December to January. The single best financial move most seniors on Medicare can make is a one-time review with a fee-only financial advisor who specializes in Medicare and retirement income. It typically costs $200 to $500 for the session and pays for itself in the first year. Most seniors never do it because nobody tells them the connection exists.
Now you know why we saved this one for last.
The Right Information Could Save Your Retirement
Medicare is one of the most complex systems most Americans will ever navigate, and the people who built it didn’t make it easy to use correctly. Forward this to any friend or family member who’s turning 65 or is already on Medicare. Their doctor won’t go through this list with them. Their insurance agent has a conflict of interest. This is the kind of thing you’d only find out from someone who’s already been through it.
