Inflation is at its highest. If you’re on a fixed income, the rising cost of goods, services, and housing can leave you with little extra to live on. Now more than ever, it’s essential to minimize costs wherever you can, and healthcare presents an excellent opportunity to do so. Here’s where Medicare Open Enrollment preparation comes in.
Starting from October 15 to December 7, you can review and modify your existing healthcare coverage options. Your choices during this period will apply until the following year, so you must choose wisely.
In this post, we guide you through the steps for preparing for Medicare enrollment to save costs. Contact us if you need help with any of the steps required to prepare for Medicare open enrollment.
Overview of Medicare Plans for Medicare Open Enrollment Preparation
First and foremost, it’s essential to understand how Medicare coverage works. Basically, there are four Parts to Medicare – Part A (hospital coverage), Part B (doctor and outpatient services), Part C (Medicare Advantage), and Part D (drug prescription plan).
Part A and Part B are Original Medicare plans for anyone at or above 65 years old. If you’re eligible for Medicare and enroll in the three months before or after you turn 65, you won’t pay any premiums for Part A.
Part B Medicare costs run $164.90 (in 2023) monthly but could be higher due to IRMAA adjustments for high earners. Part C and Part D vary based on the particular plan you choose. Once you enroll in Medicare, you’re automatically covered under Original Medicare – Part A and Part B. From there, you can pick up a Medicare Supplement Plan as well as a separate Part D drug plan since the Original Medicare doesn’t include it.
Lastly, private insurance companies offer Part C, or Medicare Advantage, to replace Part A and B and become your primary insurance coverage. However, the cost of these plans is in addition to your Medicare Part B premium. During the open enrollment period, you can make any of the following changes to your current Medicare Plan:
- Add, remove, or change a Medicare Advantage Plan
- Add, remove, or change a Part D plan
- Replace Original Medicare (Part A and Part B) with a Medicare Advantage plan
- Switch from Medicare Advantage to Original Medicare
Note that Medicare Supplements have nothing to do with the Open Enrollment Period. You are able to apply for a Medicare Supplement plan during any month of the year.
Here’s what you need to do to be prepared for the Open Enrollment Period.
Medicare Open Enrollment Preparation Steps
How well you utilize this open enrollment period will determine your health insurance costs for the following year. Take these steps to ensure you maximize this opportunity and make the right choices:
Review Your Annual Notice of Change
Medicare coverage plans change yearly, so the government requires that all Medicare Advantage and Prescription drug companies send you an Annual Notice of Change (ANOC). The letter must arrive by the end of September, which gives you time to review it before the Medicare open enrollment begins. It details the changes in your Medicare plan for the coming year.
You should review this information thoroughly as it may help you make strategic changes or decide to leave your current plan as is to minimize costs. Some of the changes you should keep a close eye on include the following:
- Changes to your Monthly Premium
- Changes to your co-pays
- Changes to the costs and coverage of your medications
- Changes to your doctors accepting the plan
Assess Your Coverage Needs
After you’ve read through your ANOC, you can compare it to your current and anticipated health requirements and make the necessary adjustments to save on costs. Depending on your active Medicare plan, there are two ways to look at this.
If you’re enrolled in Original Medicare (Part A and Part B) alone, you need to consider the following:
- Whether you need Part D Medicare: Part D prescription drug plan is provided as a stand-alone plan if you have Original Medicare. If your health needs require you to take medication, enrolling in Part D saves many out-of-pocket prescription drug costs.
- Whether adding a Medicare Advantage plan and which one is the best choice: Medicare Advantage or Part C offers comprehensive coverage, often including drug prescription coverage. Getting one comprehensive plan instead of separate plans may be a good idea. When switching to Medicare Advantage, ensure your service providers are under your plan of choice. Remember that your care may also have more network requirements and service restrictions, like requiring prior authorization for some services.
Similarly, if you’re enrolled in the Medicare Advantage Plan or Part C, you can take the following steps to ensure you get the most value from your plan:
- Shop for drug plans – Medicare Advantage often includes a prescription drug plan. Look at your current drug plan and compare it with others to see if there are plans with better copays or coinsurance than yours. Shop these plans at least every 2 years, as your health may qualify you to save money on the same coverage.
- Look at health providers – Look at the service providers covered under your plan and whether they’re the cheapest available near you. Using in-network providers is almost always more cost-effective than using out-of-network providers. And, if you have a recently acquired illness, confirm that the in-network service providers can provide adequate care for that illness, especially if specialists may be needed, to avoid significant treatment costs.
Get Financial Assistance
Various problems can arise from having a fixed income during such a time of high inflation. You may be unable to pay for your plan premiums or copays under your current Medicare plan. Your current income may also not cover the out-of-pocket costs of prescription drugs.
Luckily, the federal government offers four Medicare Savings Programs to people with fixed or limited incomes. You can also apply for the Extra Help program, which caters to out-of-pocket prescription drug costs. If you have any challenges in your Medicare open enrollment preparation, we can help. We’ve been helping seniors understand Medicare and Medicare benefits for over 40 years. Contact us today for a free consultation.