4 Steps to Navigate Medicare Open Enrollment

Medicare's annual open enrollment—which runs from October 15 through December 7 this year—is your chance to check in on your Medicare plan and, if needed, change it. 

Of course, if you're satisfied with your current plan's cost and benefits, you needn't do anything. Just keep in mind that picking a plan isn't necessarily a "one and done" event. Your health care needs can change. So can the cost and health coverage offered by your Medicare plan.

So, it's often worthwhile to look over your plan and maybe even do some comparison shopping. Here are some questions to help guide your review. 

Medicare recipients who have or are looking at joining a private Medicare Advantage plan or stand-alone prescription drug plan (Part D). 

As a reminder, Original Medicare (Parts A and B) pays a set fee to hospitals and medical service providers who agree to cover Medicare patients. However, Original Medicare doesn't cover 100% of your expenses and doesn't cap out-of-pocket costs. For example, Original Medicare may cover 80% of a $25,000 surgery, but you'll be responsible for the remaining 20%. If you require more surgeries, you may need to pay 20% of the cost for each surgery, with no limit. 

Medicare Advantage plans (a.k.a. Part C), cover the same services as Original Medicare, generally include prescription drug coverage, and cap out-of-pocket expenses. (Some plans also offer additional coverage, such as dental and vision.) But these plans have tradeoffs, including limited provider networks and a higher incidence of coverage denial.

Medicare Part D provides prescription drug coverage. Premiums vary by policy and provider, and if you have a higher income you should expect to pay more. Unless you have other drug coverage, say through an employer that is at least as good as that provided by Medicare, or are enrolled in a Medicare Advantage plan that comes with prescription drug coverage, it's important to sign up for Part D when you first enroll in Medicare to avoid any gap in coverage or late enrollment penalty.

If you have private Medicare supplemental insurance (Medigap), you can generally ignore the open enrollment period unless you want to switch to Medicare Advantage. Medigap plans will help cover out-of-pocket expenses incurred from Original Medicare, depending on which of several standardized policies you choose. Premiums vary widely based on level of coverage, as well as your age, health, location, sex, and whether your acceptance is guaranteed or subject to review.

From October 15 through December 7, Medicare enrollees can join, switch, or drop coverage. If you pick a new plan, it takes effect January 1 of next year. 

During this period, you can: 

• Join or switch between Medicare Advantage plans (Part C)
• Join or switch between Medicare prescription drug plans (Part D)
• Change from Original Medicare with supplemental coverage (Medigap) to Medicare Advantage
• Change from Medicare Advantage to Original Medicare with supplemental coverage (generally, subject to medical underwriting) 

This is your opportunity to confirm you have the right amount of coverage for the price based on your health needs. 

Some people use open enrollment to switch from Original Medicare without any supplemental coverage to a Medicare Advantage plan, which could help limit their out-of-pocket medical costs. As noted, with a Medicare Advantage plan or Medigap insurance, you could limit how much you pay in a single year for healthcare. 

If you don't change plans, your existing Medicare Advantage or a Part D will renew for another year. However, you should still consider reviewing your coverage annually. Benefits, doctor and pharmacy networks, and prescription drug coverage can change each year, as well as what you pay out of pocket (including premiums, deductibles, copays, co-insurance, and out-of-pocket maximums). 

If you're in a Medicare plan, your plan will send you a "Plan Annual Notice of Change" (ANOC) in September. The ANOC includes any changes in service, coverage, costs, network, or drug coverage that will take effect in January.

After reading the ANOC, ask yourself:

• Are my doctors and hospitals still "in-network"?
• Are my prescription drugs still covered? Can I still go to the same pharmacies?
• Are my premiums, copays, deductibles, and annual out-of-pocket limits changing?
• Are my other healthcare providers and benefits (vision, dental, hearing) still covered? Are the costs changing?

Go to medicare.gov/plan-compare to view different options. If you find the variety of coverages and costs overwhelming, contact Medicare for general Medicare questions, your local state health insurance assistance program (SHIP) for independent advice, or a Medicare insurance broker.

If you decide to stay with your current provider, you don't need to do anything. Your plan will automatically renew. Otherwise, use the annual open enrollment period to make a change.

From January 1 to March 31, Medicare Advantage enrollees should evaluate whether the newly elected plan is the right fit. You have until March 31 to change to another Medicare Advantage plan or back to Original Medicare (this is only for Medicare Advantage plans, not for Part D or Medigap plans).

That said, upon joining a Medicare Advantage plan for the first time, you have a 12-month trial period during which you can switch back to Medigap. Keep in mind you may not be able to get the same plan you had before (if you had one). Some states may give additional rights.¹

Most people make changes during the annual enrollment period or the Medicare Advantage open enrollment period, but certain life events allow you to adjust your insurance plan outside those windows. These are called Special Enrollment Periods (SEPs).

For example, you may qualify for a SEP if you:

• Move to a new address outside your plan's service area.
• Lose other credible plan coverage, such as an employer insurance plan or coverage coordinated through Social Security.
• Become eligible for Medicaid or other financial assistance programs.
• Enter or leave a skilled nursing facility or long-term care hospital.

Depending on the event, you typically have up to two to three months to make changes. These changes could include switching Medicare Advantage health plans, enrolling in Part D drug coverage, or returning to Original Medicare and adding a Medicare supplement. SEPs may affect costs too, so reviewing your potential Medicare cost changes is important.

Once you reach age 65, Medicare is an important part of managing your healthcare costs. Use the annual open enrollment period to consider whether your current Medicare Advantage plan or Plan D coverage still fits your needs. Then review your available plan options and make a change, if needed. 

For more information, visit CMS.gov or the Medicare & You handbook, or call 1-800-MEDICARE. You can also contact your state health insurance program for personalized guidance.