Whether you're approaching age 65 or already enrolled in Medicare, you should take advantage of the annual enrollment period (AEP). Also known as Medicare Open Enrollment, this is the once-a-year opportunity to review Medicare Advantage and prescription drug plans and see whether you are enrolled in the most cost-effective plan for your needs.
Research by PlanPrescriber.com shows that a large majority of Medicare beneficiaries could have saved hundreds of dollars last year by reviewing just one element of their coverage: their prescription drug plan. While it may be easy to come up with other things you'd rather do this fall, taking time now time now to review all aspects of your coverage options could really pay off.
This year's AEP runs from Oct. 15 to Dec. 7, 2018. Though Medicare beneficiaries have eight weeks to select their coverage, a few years ago, 42 percent of people waited until the last nine days to apply, according to research by PlanPrescriber.com. However, this is not a decision you want to rush or put off until the last minute. Avoid the rush this year; start comparing plans as soon as possible in order to enroll early on during the AEP.
We've compiled some important tips for people on Medicare to help ensure they pick the best Medicare Advantage or prescription drug coverage for their specific needs.
Understand the basics before filling in the gaps
Understanding Medicare can be challenging, but it's important to understand what Original Medicare (Parts A and B) cover before weighing other options. Once you understand the basics, you can compare products designed specifically to fill some of the different gaps in Medicare.
- Medicare Part D stand-alone prescription drug plans, which cover the cost of most prescription drugs;
- Medicare supplement plans, which cover portions of the deductibles, coinsurance and out-of-pocket costs not covered by original Medicare; and
- Medicare Advantage plans, which bundle together the Part D drug benefit with some additional coverage for deductibles, coinsurance and out-of-pocket costs.
Each type of supplemental coverage has different guidelines for when you can enroll, change and cancel your coverage. If you have coverage through a Medicare Advantage or prescription drug plan, know that most plans change their pricing and benefits each year.
You can use online tools to see whether and how your prescriptions drugs will be covered next year (see the suggestions at the bottom of this page).
Factor in copays and deductibles
At first glance, it may appear best to go with the plan that has the lowest premium. But bear in mind that you are still responsible for any additional out-of-pocket costs. Also consider expenses such as doctor's office copayments and deductibles. Those costs can add up, and the plan with the lowest premium may cost you more in the long run.
If you're turning 65 during the enrollment period, know the deadlines
Hundreds of thousands of people will turn 65 during this year's AEP. If you're already getting Social Security benefits, you will be contacted a few months before you become eligible for Medicare and provided with the information you need to register.
Most people are enrolled in Medicare Parts A and B (original Medicare) automatically.
While you're celebrating, keep in mind that different types of coverage have different deadlines:
- Part D prescription drug plans: You must enroll within 60 days of your Part B effective date.
- Medicare Advantage: You have three months to sign up after you enroll in Medicare Part A and Part B benefits. Otherwise, you'll have to wait for next year's annual enrollment period.
- Medicare Supplement insurance (Medigap): The Medicare Supplement Open Enrollment Period is six months long and begins on the first day of the month in which you are both age 65 (or older) and enrolled in Medicare Part B. If you miss the Medicare Supplement Open Enrollment Period, your application could be declined if you have a pre-existing medical condition, or you may be charged more for coverage.
Remember, there's no reason to enroll without assistance. Qualified professionals can help you understand your options and select a plan. You can get help through your State Health Insurance Assistance Program (SHIP), websites like licensed health insurance agents who are certified to sell Medicare, or by calling 1-800-Medicare.
The Centers for Medicare and Medicaid Services (CMS) has neither reviewed nor endorsed the information provided by PlanPrescriber.