Most people are aware of the annual Medicare Open Enrollment Period that runs from October 15 until December 7, but few know about another important time when changes can be made to one’s coverage. The Medicare Advantage Disenrollment Period (MADP) runs from January 1 through February 14 each year and is an important window for beneficiaries and family caregivers.
During the MADP, people enrolled in Medicare Advantage Plans (also known as Part C) can cancel their coverage if they find it’s not fitting their needs. Those who do elect to drop a Medicare Advantage Plan will be placed back on “Original Medicare” (Parts A and B that are offered directly through Medicare rather than a private insurance company). They also have the option to enroll in a stand-alone Prescription Drug Plan (Part D) and/or a Medigap Plan.
However, beneficiaries cannot join a Medicare Advantage Plan, switch to a different Advantage Plan, switch to a different Part D Plan, or join, switch, or drop a Medicare Medical Savings Account during the MADP.
If you’re considering taking advantage of the MADP, take care to avoid gaps in coverage. I encourage beneficiaries to consider the following important pieces of advice before acting:
- Know the gaps in Original Medicare. Like Medicare Advantage, Original Medicare (Parts A and B) has deductibles and coinsurance. But, unlike Advantage Plans, Original Medicare doesn’t have a cap on how much you may have to spend out of your own pocket each year if you get sick or injured. All Medicare Advantage Plans feature a $6,700 limit on out-of-pocket spending for covered medical services (some plans have lower caps), which can be a real asset for some beneficiaries. It’s also important to remember that Original Medicare does not cover the cost of prescription drugs.
- Look before you leap. I encourage people to make a checklist of benefits they want to keep before they drop an Advantage Plan. For example, be sure your current doctor(s) will still see you if you change to Original Medicare. If you take any prescription drugs, it is worth researching a stand-alone Medicare Part D Plan that will cover the medications you take at a reasonably low price.
- Consider a Medicare Supplement. If you’re planning to switch to Original Medicare, you may want to consider bolstering your coverage with a Medicare Supplement policy (also known as Medigap). Most states offer 10 different Medicare Supplement Plans denoted by letters A through N. Each lettered plan must provide the exact same minimum level of supplemental coverage, so Plan F from one company must legally provide the same basic coverage as Plan F from another insurer. You can compare plans side-by-side at PlanPrescriber.com. However, keep in mind that after your Medigap Open Enrollment Period (the six-month period after you enroll in Part B) ends, Medicare Supplement Plans are medically underwritten, which means some people may not qualify or costs may be prohibitive.
- Don’t lose additional benefits. Some Advantage Plans provide routine dental, vision and hearing coverage, which original Medicare does not. Medicare Supplement Plans do not typically provide these services either. So, if you drop your Advantage Plan during the MADP, you may need to purchase stand-alone coverage for vision and dental care.
While the MADP may seem like an easy opportunity to make changes to Medicare coverage, the decision is actually very complicated and requires thorough research. Carefully comparing the extent of coverage and costs of each option will ensure you do not run into any costly surprises down the road.