Few things are more important to retirees than Medicare. Tens of millions of Americans, most of them 65 and older, rely on Medicare to keep them healthy, pay for all or most of their prescriptions, and help them deal with chronic medical conditions that can become much more serious with age. Yet for a program that does so much and has been around for so long, Medicare remains the subject of wide-ranging myths and misunderstanding, some of which can cost you thousands of dollars if you fail to get the facts.
Big Medicare Mistakes Often Hit During the First Year
We recently discovered an article that might prove helpful, especially if you’re in the process of applying for Medicare for the first time in 2019. This one comes from a website called Considerable.com, and it focuses on what the author, Danielle Roberts, calls “the big Medicare mistakes to avoid in your first year of coverage.” Her point is that, if you familiarize yourself ahead of time with some basic Medicare facts, you can “do your health (and wallet) a favor.” As Roberts writes, “Medicare has many rules and guidelines, so it’s sure to throw you a curve ball or two every now and then. And it turns out mistakes are most common in a beneficiary’s first year of coverage.” Instead of finding out the hard way that you’ve wasted money on a costly oversight, she suggests you “stay in front of what not to do by getting a handle on Medicare’s rules now and avoid the common errors altogether.”
In her column on the Considerable.com website, Roberts, who works for a Texas-based insurance agency specializing in Medicare-related plans, lists what she called “some of the most common mistakes people make within their first year” of Medicare coverage. Some of these might sound pretty basic, but judging by the number of Medicare-related questions we get here at AgingOptions, perhaps some basic information is what’s needed.
Medicare Mistakes: Assumptions, Delays, Poor Choices
Here’s Danielle Roberts list of Medicare Mistakes:
- Assuming you’ll be enrolled automatically: This is generally not true: you need to take action to sign up, unless you’re already getting Social Security benefits at least four months prior to your 65th birthday month, in which case you will be auto-enrolled in Medicare Parts A and B. But don’t assume that just because you’re turning 65, you’re signed up. A missed deadline results in a late enrollment penalty which you’ll pay each month for the rest of your years.
- Not enrolling in Part B at age 65: As Roberts says, “the only valid reason to delay that will avoid a penalty is if you have creditable health insurance coverage that is primary to Medicare.” Translation: if you’re covered under a qualifying workplace health insurance plan, either your own or your spouse’s, you can wait. But if you’re on COBRA benefits or a self-purchased Obamacare plan, that’s not the same thing, so make sure you contact Medicare before you hit age 65.
- Not enrolling in Part D at age 65: Part D covers prescription drugs. According to Danielle Roberts, “Some people delay enrolling in Part D because they don’t take any medications, and therefore feel they don’t need Part D. However, this could result in a costly mistake.” That’s because, after your initial enrollment period, you can’t add drug coverage until open enrollment each year in the fall – a reality that could expose you to thousands in uncovered drug costs if your health takes a turn for the worse early in the year.
- Enrolling in the wrong Part D plan: This sounds awfully basic, but if you’re on a prescription drug when choosing a plan, pick one that covers your medications! And don’t take someone else’s word for it – do your homework. Medicare’s Plan Finder is a good resource.
- Missing the open enrollment period for Medicare Supplement insurance: The only time you are guaranteed to be able to buy Medicare Supplement coverage without having to answer health questions is during the six months after your Part B coverage begins. Once that open enrollment period ends, depending on your health, companies that offer Medicare Supplement policies can decline to insure you based on your health.
- Choosing coverage that’s not cost-effective for your circumstances: Many of us, when faced with the decision about what coverage to buy, start by asking other people what choices they made – but that may be unwise, Roberts suggests. “It’s important you research each type of plan and learn how they work, then decide which is most cost-effective for you,” she says. How much do you travel? How often do you go to the doctor? What preexisting medical conditions do you have? What’s your budget for out-of-pocket costs? All of these factors and more will influence your decision.
- Choosing a plan that doesn’t include your physician: Medicare Advantage plans, unlike regular Medicare, have networks of participating providers included in each plan. If you pick a plan before you verify that your doctors accept it, then you could end up having to change providers. “To avoid this, verify with your doctors which plans they accept,” Roberts says. “You can confirm their participation in the plan’s directory so that you can be sure you are choosing a plan that will allow you to continue seeing your favorite providers.”
The Biggest Medicare Mistake: Failure to Plan Properly for Retirement
Planning and preparation are essential to making good decisions about all aspects of retirement, not just Medicare. Medicare is a vital component of ensuring good health, just as Social Security is essential to the financial well-being of the majority of seniors, yet successful retirement involves more than health care and a predictable income. You should also look ahead to the kind of housing choices you’ll want to make in the future. You should think about the sort of legal protection that might be necessary to safeguard your estate and protect your wishes. You also need to take your family into account and make certain they know how you want to live in retirement. Is there one approach to retirement that encompasses all these vital facets of retirement? Fortunately, the answer is yes: a LifePlan from AgingOptions.
The best way to learn more is to join Rajiv Nagaich at a free LifePlanning Seminar. There you’ll discover the answer to many of your retirement questions and you’ll gain valuable insight to help you plan for the secure and fruitful retirement you’ll always hoped for. For a calendar of upcoming seminars, visit our Live Events page and enroll in the event of your choice. It will be a pleasure to meet you!
(originally reported at https://considerable.com)