It’s almost that time again. Every year on Oct. 15, Medicare opens up for enrollment. During this annual enrollment period (AEP) through Dec. 7, those eligible for Medicare are allowed to change their plans. When they do, their new plans will be effective on Jan. 1 of the upcoming year.
One of the most-talked about plans is the Medicare Advantage Plan, which sometimes offers extra coverage to cover vision, hearing, dental or other health and wellness programs. Most also include a qualified prescription plan. You usually pay an additional monthly premium for a Medicare Advantage Plan.
You likely will have to pay co-pays and other fees with a Medicare Advantage Plan, but most of the plans have dollar limits — called MOOP or Max Out of Pocket, or the most you would have to pay out of pocket in a given year. These limits typically can range from $3,000 to $7,000 a year depending on your plan.
Medicare Advantage Plans can range from no extra cost to several hundreds of dollars a month depending on the plan, where you live and the company that you use. Often, the lower the premium, the more you pay when you use the plan. However, they may also offer other benefits as well, such as a prescription drug plans. (Medicare Advantage Plans are a replacement for Medicare, but you are still entitled to the same rights and protections under the Medicare program such as the right to appeal a coverage decision.)
As you consider your coverage during the enrollment period, I also encourage you to look at Medicare Supplements to see if you can save some money as you choose the best plan for your health-care needs.
Medicare Supplement Plans, also called Medicap plans, are different from Medicare Advantage Plans. With a Medicare Supplement Plan F, for instance, what you pay monthly is your cost for your health care as long as you are using a doctor, hospital, urgent care or the like that accepts Medicare Assignment. (Remember: Whether you have a Medicare Supplement Plan or a Medicare Advantage Plan, you always need to be sure that the medical entity you are using is either in your network and/or accepts Medicare. Neglecting to ask that question could result in some painful bills. Be proactive and be aware of who accepts what, especially when you are going to a new provider — even if you were referred by someone you are currently using. Always check!)
When you turn 65, you have an open enrollment period for a Medicare Supplement Plan. During that period, you do not have to answer any health questions to obtain a Medicare Supplement Plan if you had been covered by a creditable health plan for six months before turning 65. (Note that not all plans require the pre-existing coverage.) And anyone who already has a Medicare Supplement can change plans any time during the year as long as they can answer the health questions “successfully.” (Different rules may apply if your Part B starts after 65 for some reason.)
With a Medicare Supplement Plan F, when you go into the hospital, everything is usually covered. If you have doctor visits, you typically have no co-pays. If you need tests or surgery (in or out of the hospital), there is usually no out-of-pocket expense. And, obviously, there are no max-out-of-pocket amounts as the Supplement Plan is paying the full amount on the difference owed after Medicare pays its share (usually about 80 percent of the bill). Your medical costs are essentially the combined amounts of any monthly premiums that you pay, making it easier to budget each year. (The premiums for a Medicare Supplement Plan may be higher than those for Medicare Advantage Plans, so you need to estimate what your out-of-pocket costs might be with a Medicare Advantage Plan to compare what this means for your budget.)
You need to shop for a Medicare Supplement Plan just like you would shop for a Medicare Advantage Plan. There can be differences in pricing on the exact same plan between different companies. For instance, my wife and I just changed to a different Medicare Supplement Plan and are now saving $88 a month between the two of us from what we were paying before.
In addition, when you purchase a Medicare Supplement instead of a Medicare Advantage Plan, you also need to purchase a stand-alone prescription-drug plan. Depending on your prescription needs, those plans can run from about $18 to $30 a month or more. You can go to Medicare.gov and put in your prescription information, and the website will show you available plans and how much your prescription costs will be for the year.
Some Medicare Supplement Plans may also cover services that Original Medicare does not cover, such as medical care when you are traveling outside of the United States.
No matter what plans you choose during the upcoming annual enrollment period, do your homework. Review your options at the Medicare.gov site and seek out expert advice from a licensed agent or Medicare expert. Senior Health Insurance Benefits Advisors (SHIBA) serves Idahoans on Medicare with free, unbiased Medicare benefits information and assistance through workshops, group presentations and personal counseling. Call the SHIBA Medicare Helpline at 800-247-4422.
Bob Arnett owns Arnett Life Insurance Services in the Treasure Valley and is a health- and Medicare-certified agent who has been working in the business for seven years. Learn more at alisprotect.com.