Medicare Open Enrollment runs from now until December 7. With approximately 48 million current recipients of Medicare and 10,000 baby boomers turning 65 every day in the U.S., chances are you or a family member will need to take action this season.
Before you do, however, make sure you’re clear on these five, often misunderstood points:
- It’s important to review your coverage every year.
During the Open Enrollment period, anyone who is receiving Medicare benefits is permitted to make changes to their coverage. This includes changes to their Medicare health plan and/or prescription drug coverage, all of which will take effect January 1, 2014.If you’re satisfied with your plan, you don’t need to take any action. But beware – it would be a mistake to simply ignore the Open Enrollment period, as some things regarding coverage may have changed, including benefits, costs and even your healthcare status.
All of this means that what worked for you last year may no longer be appropriate. Make sure therefore to reassess everything, every year.
- The Affordable Care Act does not affect Medicare.
The Affordable Care Act (ObamaCare) and the Health Insurance Marketplace (Exchanges) have no impact on Medicare. This new law and the marketplace created by it were designed for people who don’t have health insurance – if you have Medicare, you have insurance.Not only is Medicare’s Open Enrollment not part of the new Health Insurance Marketplace, it is against the law for someone who knows that you have Medicare to sell you a Marketplace plan.
Unfortunately, the Medicare Open Enrollment period is a time when there’s a higher risk for fraudulent activities. So be cautious, both for yourself and for those you love who receive Medicare.
- All Medicare coverage is not the same.
Prior to the mid-nineties, Medicare coverage was consistent and quite standardized. It didn’t cover prescription drugs or preventative care and offered just a few options for additional coverage.Over the past 20 years, however, the private insurance companies have gotten involved, bringing with them many more options. If you’re wondering why you or your loved ones have been inundated with materials in the mail and advertisements on television, it’s because the private insurance companies are vying for your business!
Unfortunately, these “Medicare Advantage” offerings can be difficult to sort through and compare, so make sure you’re getting the facts directly from Medicare itself. The best resource I’ve found for this is the “Medicare and You” summary found here.
- It doesn’t cover everything.
Many people are under the mistaken impression that once they’re covered by Medicare, there are no additional out-of-pocket expenses. Unfortunately, that is not the case.Just as you probably paid deductibles, copayments, out-of-pocket costs and other fees in connection with your employer-provided health insurance, Medicare also does not cover everything. How much does it cover? On average, and as with your health insurance before, about 20% of medical costs will be shouldered by you.
- It’s not free.
As with #4 above, many people assume that Medicare premiums are free to those who are eligible. And while it’s true that you don’t have to pay any premiums for Part A (inpatient care), you do need to pay for Part B (outpatient, including things like physician visits and diagnostic testing), Part C (Medicare Advantage) and Part D (prescription drugs).The amount you’ll pay is a function of your income from two years prior. For example, if you sign up in 2014, your income from 2012 will be used to calculate premiums. (Click here for more detail on how Medicare premiums are calculated.)
I know, it can be confusing! And whether you are new to Medicare or renewing your plans during Open Enrollment season, the task of paying attention to this federal benefit is important.
Even if you are not directly impacted because you are not currently eligible, my guess is that a parent, aunt or neighbor is facing the task of review and might need some assistance. Every year, an updated version of Medicare & You is available online and customer service professionals are available at 1-800- MEDICARE (1 800 633 4227).
Good luck, take your time, and please get in touch if I can be of assistance.