Medicare open enrollment begins this coming week, on October 15th. It’s your annual opportunity to reexamine your plan and see what’s changed – and decide if there’s a better way to meet your health care needs. During this important “open season” which continues through December 7th, we’ll do our best here on the AgingOptions blog and on the radio program to make certain you’re kept up to date on the latest Medicare news. Toward that end, we offer this article just published on the InvestmentNews website, written by contributing editor Mary Beth Franklin, that provides some important reasons why it’s worth your time during open enrollment to check out your options – you could be getting better coverage at a lower cost.
Open Enrollment is Your Time to Consider Money-Saving Changes to Your Plan
In her article, Franklin (who is writing to an audience of financial planners and wealth advisers) points out that many retirees tend to consider Medicare enrollment as “a once-in-a-lifetime event,” akin to decisions on when to retire and when to claim Social Security. “But,” she warns, “such a set-it-and-forget-it attitude about health care coverage options in retirement can be a costly mistake.” That’s because insurance companies can make changes to Medicare plans every year, changes that affect out-of-pocket costs for monthly premiums, deductibles, drug costs and health care provider networks and pharmacies. “Medicare beneficiaries have the opportunity to re-shop their health care and drug coverage choices during the annual open enrollment season which runs from October 15 through December 7 every year for coverage that begins the following January 1. In reality, few do.”
During the upcoming open enrollment period for plans taking effect in 2020, the stakes are higher than usual, according to InvestmentNews. There are revised rules governing prescription drug coverage. Some of the regulations for first-time enrollees for Medigap supplemental insurance plans have changed. Finally, continuing an ongoing philosophy of sweeting the pot to drive up enrollment, Medicare Advantage plans are offering expanded benefits at the same time as premiums are going down. On top of that, says the article, Medicare officials have unveiled a newly redesigned Plan Finder tool supposedly designed to help beneficiaries find their best coverage options by comparing all the options more easily – original Medicare, Part D drug plans, Medicare Advantage plans and Medicare supplemental insurance policies. One advocacy group, the Medicare Rights Center, has already weighed in, “[applauding] the new tool’s streamlined design and improved user experience” while urging the Centers for Medicare and Medicaid Services (CMS) to make still more improvements and replace some missing elements before open enrollment begins. We’ll keep an eye on this story.
Open Enrollment Presents a Wide Range of Options – and Potentially Confusing Choices
As the InvestmentNews article reminds readers, this window called open enrollment is the time to exercise a wide range of options. “During Medicare open enrollment, clients can move from original Medicare to a Medicare Advantage plan, switch from Medicare Advantage to original Medicare, swap one Medicare Advantage plan for another or choose a different Medicare prescription drug plan.” It’s also the time for people who chose original Medicare during their initial enrollment period (typically at age 65) to opt for a supplemental Medigap policy to help cover costs Medicare doesn’t include. But be advised that, if you’re switching from Medicare Advantage plans to Medicare in the future and want to add Medigap coverage, you’ll likely be subject to medical underwriting and may be denied coverage or charged a higher premium. For that reason many enrollees choose the Medicare/Medigap route from the outset, especially if they want to have access to the widest number of physicians and specialists.
About one-third of the current 60 million Medicare beneficiaries opt to buy a Medicare Advantage plan offered through a private insurance carrier. These plans usually cover all the hospitalization and outpatient services of original Medicare, and many include prescription drug coverage, along with a host of other services Medicare doesn’t cover: basic vision services, hearing exams, some degree of dental coverage, and bonuses like free gym membership. One senior we know just learned that the “premium dental coverage” that had been an extra-cost option in 2019 is being rolled into the basic Medicare Advantage policy in 2020, but at a slightly lower premium overall. The downside: most Medicare Advantage plans only allow you to see “in-network” health care providers unless you pay a hefty surcharge.
Open Enrollment: Many Premiums are Dropping While Benefits Improve
CMS predicts that enrollment in Medicare Advantage plans will grow to 24.4 million beneficiaries in 2020, up from 22.2 million this year. “The agency expects the average monthly premium for Medicare Advantage plans to decline 14 percent next year, to $23 per month,” says InvestmentNews. Enrollees in Medicare Advantage plans are also required to pay Medicare Part B premiums which are expected to rise from just over $135 in 2019 to $144 in 2020 (although higher-income retirees may pay more). Meanwhile, there’s good news for Part D drug plan enrollees: average premiums are expected to drop by more than 13 percent next year.
Don’t Delay Planning for Medicare – or Planning for Retirement!
The bottom line, says InvestmentNews, is not to delay your “Medicare check-up.” With all the changes, and a newly redesigned Plan Finder tool, even the pros are likely to be confused. Apart from the Medicare website, you’ll find a helpful open enrollment guide here on the website of the National Council on Aging. We also encourage you to contact us at AgingOptions if we can be of help, or, better yet, to join Rajiv Nagaich at an upcoming LifePlanning Seminar. At these highly popular events, Rajiv demonstrates how your medical insurance planning is just part of a much broader retirement picture that also includes financial plans, legal protection, family communication and housing strategy. When all these strands are woven into one cord called a LifePlan, the result is a fruitful and secure retirement.
Please accept our invitation and bring your questions to a free LifePlanning Seminar. You’ll find a complete calendar of scheduled seminars here on our Live Events page where you can sign up for the location of your choice. The sooner you attend, the sooner your LifePlanning journey can begin. Meanwhile, age on!
(originally reported at www.investmentnews.com)