Senior Benefits: How to Save Thousands During Medicare Open Enrollment
Medicare recipients who want to review their coverage and make changes get a chance once every year during the Medicare Open Enrollment period. That period begins on Oct. 15 and ends on Dec. 7, including in 2022.
The open enrollment period provides an opportunity for the nation’s more than 60 million Medicare beneficiaries to scout ways to get the best out of the federal health insurance program for people 65 and older. But experts say too many seniors don’t take advantage. AARP reported this week.
Tricia Neuman, senior vice president of the Kaiser Family Foundation and executive director of its Program on Medicare Policy, told AARP that beneficiaries can save hundreds or even thousands of dollars by finding plans that better fit their needs, whether it’s through Medicare Part D, Medicare Advantage, or something else.
The open enrollment period lets you make changes that will go into effect the following year. It is different from other enrollment periods, such as the initial enrollment period for those about to turn 65 and the special enrollment period for those who lose employer-based health coverage after age 65.
For open enrollment, options differ depending on whether you are enrolled in original Medicare or a Medicare Advantage (MA) private insurance plan. Original Medicare consists of Part A (hospital coverage) and Part B (doctor and outpatient services). Regardless of which plan you are enrolled in, you might also want to consider using open enrollment to get a stand-alone Part D drug plan that helps pay for prescription medications. Monthly premiums are charged for Part B and Part D, but most people don’t pay a premium for Part A, according to the AARP.
Because Part A and Part B are standard for all Medicare beneficiaries, there’s nothing for you to change. However, because Part D plans vary, open enrollment is a good time to either change your Part D plan or add one if you don’t have one already. You also can switch from original Medicare to a private Medicare Advantage plan during open enrollment.
The AARP also advises using the open enrollment period to confirm that your preferred doctors and medical facilities will continue to accept Medicare in the new year. More than 90% of doctors participate in the program – as well as the vast majority of hospitals – so our medical providers probably won’t change their Medicare policies. Even so, it never hurts to double-check.
Here are a few things to keep in mind during open enrollment:
- Every September, Medicare Advantage plans are required to send their members a letter called the Annual Notice of Change. This letter details changes the plan will make starting in January, such as benefits, costs or the geographic coverage area. Use this information as you decide whether to stay with your current MA plan, change to a different MA plan or switch instead to original Medicare.
- If you are already in an Advantage plan, you’ll receive extra time to decide what to do. The special open enrollment period runs from Jan. 1 through March 31, during which you can switch from one Advantage plan to another, or to original Medicare. If you switch to original Medicare, you’ll also be able to get a stand-alone Part D prescription drug plan. This special period only applies to people who already have an MA plan.
- During open enrollment, check the provider directories of your Medicare Advantage plan to ensure your doctors are still in it. If not, you might want to consider changing plans, depending on the importance you place on seeing specific doctors.
- If your health status has undergone a big change, such as being diagnosed with cancer or another serious illness, confirm whether the physicians and medical centers you need are available to you in network under your current plan. Otherwise, you run the risk of facing hefty out-of-network bills.
- Medicare beneficiaries get their prescription drugs either through a stand-alone Part D prescription drug plan or as part of their Medicare Advantage plan. During open enrollment, check to see whether the medications you take are still covered under your current plan — and at what cost. You should also look at preferred pharmacies in your current plan and whether they are convenient to where you live. Also, look at whether you can save money by getting your drugs through the mail and whether your plan offers that.
Meanwhile, you should also be aware of changes to out-of-pocket costs for prescriptions included in the Inflation Reduction Act of 2022. Currently, people who reach a certain level of out-of-pocket spending on prescription drugs — the 2022 threshold is $7,050 — enter “catastrophic” coverage and must pay 5% of the costs above that level. Beginning in 2024, people with catastrophic costs will not have any additional out-of-pocket costs once they’ve reached the threshold level. Beginning in 2025, out-of-pocket prescription drug costs will be capped at $2,000 year.
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Medicare beneficiaries can compare plans and change their enrollment by going to www.medicare.gov. During the open enrollment period, there is also live chat assistance on the website as well as a 24-hour hotline where reps can answer your open enrollment questions. That toll-free number is 800-633-4227.
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