The arrival of autumn brings about the changing leaves, pumpkins and cooler weather. It also brings about Medicare open enrollment. Open enrollment, which happens between October 15 and December 7, provides the opportunity for current participants in Medicare to evaluate their drug plans and supplemental coverage and to make any necessary changes. (Open enrollment is not the time for new participants to sign up for Medicare).
For Medicare participants who have prescription drug plans (Part D) or are enrolled in Medicare Advantage plans (with or without drug coverage) it is important to take advantage of the opportunity of open enrollment and to not just assume that this past year’s coverage is still the best and most cost-effective coverage.
Why you should evaluate your plan every year
There are annual changes to drug plans that may impact the coverage and cost of the drugs that participants take. Also, new drug plans enter the marketplace and may provide similar coverage at a cheaper price. Every participant of a drug plan should receive an annual document called “Evidence of Coverage.” It is in this document where a drug plan’s current coverage is explained and the participant is notified of what changes are going to take place in the coverage. We advise clients to carefully review this document and to look at the following items:
- Monthly premiums
- Drug formulary
- Medication tiers
- Annual deductible
- Copayments of coinsurance
- Coverage rules
- Additional benefits in the Coverage Gap
- Pharmacy networks
- Quality ratings of plans
For those who want to shop for a new drug plan, the Medicare Plan Finder is a great place to start.
|Medicare Open Enrollment Dates|
|Beginning Date:||October 15, 2019|
|End Date:||December 7, 2019|
|Effective Date of any changes made during open enrollment:||January 1, 2019|
Medicare Advantage Plans
For Medicare Advantage (MA) plans (which are run by insurance companies and structured in HMO and PPO formats) it is important for the recipients to not only review the “Evidence of Coverage” documents to see changes in their drug coverage but to learn of changes that may impact what doctors they can see and which medical facilities they are able to access. MA plan recipients should pay close attention to the following during their review:
- Monthly premium
- Annual deductible
- Annual-out-of-pocket spending limit
- Your out-of-pocket costs (co-payments, coinsurance)
- Provider network
- Quality ratings of plans
- Optional benefits such as dental or vision
If you decide to make a switch you can call 1-800-MEDICARE or the insurance provider of the new plan. Alternatively, you can go online to medicare.gov or the insurance carrier’s website.
The following actions can take place during open enrollment:
- For those with Original Medicare (Part A, B, D and a Medigap policy)
- Drop Original Medicare and switch to a Medicare Advantage plan (it is important to note that a participant may not be able to switch back to Original Medicare at a later date if medical underwriting reveals a pre-existing health condition that an insurance company will not cover).
- Change, enroll in or drop Part D coverage
- For those with Medicare Advantage plans
- Switch to another MA plan with or without drug coverage
If you do decide to make a change to your current coverage the change will go into effect on January 1 and at that time you should be automatically unenrolled from your old coverage.
If upon review of your current coverage you find that it is still the best coverage for you, you do not have to do anything to stay in your current plan and you will automatically be re-enrolled by your current provider.
Take a look under the hood
We recommend that all Medicare recipients take advantage of the open enrollment period in order to take a look “under the hood” of their current Medicare coverage. This exercise is important to avoid paying more than you have to (i.e., higher premiums) and to make sure that you understand what is and what is not covered by your insurance. Once you are clear, you may want to adjust your financial plan accordingly.
Medicare decisions are important to your overall financial plan. We recommend that you discuss the choices with your Wealth Advisor, who will be able to serve as a resource to determine the right coverage for you.
|Changes you are eligible to make during Open Enrollment period|
|If you are a traditional Medicare participant…||If you are a Medicare Advantage participant….|
|Drop traditional Medicare and switch to a Medicare Advantage plan||Switch to another Medicare Advantage plan with or without prescription drug coverage|
|Change, enroll in or drop a part D prescription drug plan||Drop Medicare Advantage and switch to traditional Medicare (however coverage can be denied by insurance companies based on pre-existing health conditions)|
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