by Steve Guntli
Medicare’s fall open enrollment runs Wednesday, October 15 through Sunday, December 7, which means that seniors can choose to change their Medicare coverage with few restrictions. But navigating the complex rules and regulations governing Medicare distribution can feel a bit like solving a puzzle with several pieces missing. Medicare offers many plans, each one designed to cater to specific needs and histories for patients, and each one must be renewed annually.
“People aren’t always aware that it’s an annual thing,” Hanson said. “People might sign up for a plan and stick with it year after year. Plans could change every year, and as a person’s health needs change, they need to update it. That’s what this open enrollment period is all about.”
Medicare vs. Medicare Advantage
Listed below are a few of the basics that seniors should know when evaluating their Medicare requirements:
The first step is to figure out if original Medicare or a Medicare Advantage plan better serves you. Original Medicare plans are split into two parts: Part A, which covers things like hospital stays, nursing home care and hospice, and Part B, which covers necessary services and supplies like surgeries and wheelchairs.
Medicare Advantage plans, sometimes referred to as Part C, are offered in conjunction with a patient’s private insurance company. Both Part A and Part B benefits are covered by a Part C plan.
The biggest difference between Medicare and Medicare Advantage is how much you pay. Original Medicare has a monthly premium, typically between $100 and $335 for individuals, depending on your income, plus a $147 annual deductible for Part B. Most people don’t pay for Part A premiums if they paid into Medicare while they were working or if they have retirement benefits, but those who do have to buy Part A coverage can expect to pay around $430 each month.
Medicare Advantage plans offer much lower monthly premiums, which vary depending on the provider, but require a copay after doctor’s visits.
“It’s a way of controlling costs,” Hanson said. “I usually recommend Advantage plans for people who are in good health and don’t really have a lot of medical needs. That way you can see a doctor when you need to and don’t need to worry about losing the farm.”
Hanson said Medicare Advantage plans have to be as good as original Medicare, and most are even better, offering coverage on things like gym memberships and vision and hearing tests.
Advantage plans still involve risks. Since private companies oversee them, those companies can choose to drop Medicare coverage at any time, and the recipient will default back to original Medicare. But generally, Advantage plans are efficient and helpful for younger seniors in good health, Hanson said.
The Medicare program began covering prescription drugs in 2006, implementing a Part D plan, which is supplemental coverage that pays for prescription drugs. Sometimes, the difference between Medicare costs and Part D costs create a coverage gap called the “donut hole,” and that’s where Medigap insurance comes in.
Medigap is a supplemental insurance policy, provided by private companies, that helps pay for those disparities in cost, as well as extra charges like co payments, coinsurance or deductibles.
Most Advantage plans already offer prescription drug coverage. If you’re already a member of a Medicare Advantage plan that has a prescription drug program and you sign up for Part D, you could be dis-enrolled from the Advantage program and automatically re-enrolled in an original Medicare program, so it’s best to be cautious before signing up for any new programs.
When to sign up
Signing up for Medicare can be confusing and unpleasant, but procrastinating can be costly. Seniors become eligible for Medicare coverage when they turn 65. Failing to sign up during the initial enrollment period (usually three months before one’s 65th birthday), or when work-based insurance plans stop providing coverage, will add a penalty fee to Part C and Part D programs. Missing the deadline by even a month qualifies as missing it by a year, and every year you’re late, you get a 10 percent penalty charge on Part B coverage.
Some insurance coverage also has a waiting period before it kicks in, so a delay could leave you without insurance for several months.
Don’t be afraid to ask for help
Medicare coverage should be an essential part of a senior’s everyday health and security, so ensuring eligibility early and working with a professional can make a big difference.
“It’s a very complicated issue, because Medicare coverage changes from year to year,” Hanson said. “More insurance agents are being trained in Medicare to help clear things up. Help can be found.”
Medicare itself provides a number of valuable resources. Their website, medicare.gov, includes a comprehensive guide on the intricacies of Medicare coverage, and includes several tools to find a plan that works best for you. You can also call 800-MEDICARE to speak to a professional, or visit a third-party website such as the State Health Insurance Assistance Program (shiptalk.org), a federally funded insurance counseling service.
Call Pam Hanson Insurance Solutions at 360/224-1395 for additional help.