Medicare Open Enrollment 2017 began earlier this month on October 15th. It continues through December 7th and allows any new choices you make to become effective on January 1, 2017.
Medicare Open Enrollment makes it possible for you to be pro-active: to assess the suite of Medicare products you may be enrolled in and to make a change(s) that best suits your needs or the needs of someone you care for.
When you first enrolled in Medicare, either when you turned 65 or during a Special Enrollment Period, you were probably inundated with marketing materials from private insurance companies. These companies were trying to convince you to purchase their Medicare Part D prescription drug plan, or maybe their Medicare Advantage Plan, or possibly their Medigap Plan to supplement Medicare Part A and B.
I am hopeful that at that time, you made an effort to understand the differences between the different products, analyzed your own healthcare and demographic situation and made a choice with which you remain satisfied. If not, here’s your chance to make corrections!
Review of products
Let’s review the basics:
- Medicare Part A covers inpatient care and has no premium associated with it
- Medicare Part B covers outpatient care and does have a premium associated with it that may be higher if you are a Higher Income Beneficiary
- Medicare Part C is a Medicare Advantage Plan that you can purchase from a private insurance company and have in place in lieu of traditional Medicare Parts A and B. It may or may not have a premium associated with it; it may or may not include prescription drug coverage and, even if you chose it, you still have to pay your Part B premium and any income adjustments, no matter what
- Medicare Part D is prescription drug coverage you purchase from private insurance companies and has an associated premium
- And lastly, Medigap policies can be purchased from private insurance companies, have an associated premium, and “wrap around” traditional Medicare Parts A and B, providing a benefit beyond what Medicare pays
Review of Options
Here are some examples of the combination of products a Medicare recipient can have:
- Medicare Part A, Part B and Part D
- Medicare Part C only that includes prescription drug coverage
- Medicare Part C that excludes prescription drug coverage and Part D
- Medicare Part A, Part B, Part D and a Medigap plan
- Any of the products noted above combined with a Retiree Medical Benefit from a previous employer
Clearly, there are many options available to Medicare recipients. Open Enrollment season affords you the opportunity to review those options and decide if what you have meets your needs. If it doesn’t, now is the time to reassess and make a change.
How to evaluate
Here are some questions you should ask yourself (or a loved one, if you are in the position to assist an older adult for whom this may be overwhelming):
- Am I satisfied with what I have?
- Does the plan I have allow me to see the doctors I want, go to the hospital I want and obtain my prescription drugs from the pharmacy I prefer?
- Do I have to get referrals for specialist care and do I have to stay within a particular network of doctors? If so, am I okay with that?
- Do I have any coverage if I decide I want to go outside the network?
- If I must live within a network, do I plan to live the entire year within the geography the network covers or do I plan to spend significant periods of time in a different state or country?
- How much does my current suite of products cost me each year? Be sure to include premium amounts for any product you have AND any out-of-pocket cost for deductibles, co-pays, co-insurance amounts or out-of-network costs. Think about this for both healthcare services and prescription drugs
- How much do I generally utilize the healthcare system and what do I know will be happening in the year ahead, such as some form of elective surgery or complex treatment for a diagnosis I recently received?
- What specific medications do I take, at which dosages and intervals? Have these changed over the past year?
- Have I received a notice in the mail called a Plan Annual Notice of Change about how my current suite of products will change next year, either levels of coverage or cost?
- Did I recently move or do I plan to move in the year ahead?
- Do I need to consider coverage for a spouse or dependent children in the year ahead?
- What are the out-of-pocket maximums on my plans and based on that, how much financial risk am I carrying in the event I were to incur astronomically high healthcare related costs?
- How much financial risk am I willing to bear?
Two Real Life Examples
Once you answer the questions above, it’s time to superimpose your specific health and financial circumstances on the options available to you. Here are some brief scenarios that reflect why individuals might make a change:
Sandra turned 65 a year ago. Based on her good health, the fact that she was not on any prescription drugs, and her plans to remain in Massachusetts, she chose a Medicare Advantage plan that covered prescription drugs and had no additional premium associated with it (although she still had to pay her Medicare Part B premium of $121.80 per month). The plan was an HMO plan that included her primary care physician, her local community hospital and her local pharmacy.
Almost immediately following her 65th birthday, Sandra was diagnosed with hypertension and was noted to be pre-diabetic. Within the past three months, Sandra received a diagnosis of colon cancer. She now has numerous specialists on her team and has sought several second opinions for her care. She wanted to seek care from a provider in another city but could not afford to because she had no coverage for this out-of-network provider. In addition, she found that her out-of-pocket costs were adding up for the deductibles she needed to meet and the co-pays and co-insurance amounts she was now responsible for.
Sandra re-assessed her situation and looked at two options, one was a different Medicare Advantage Plan that had on out-of-network benefit; the other was reverting to Medicare Parts A, B and D and purchasing a Medigap Plan. Both options were going to cost more up-front, but the additional coverage levels meant that in the long run she would actually be paying less based on her specific needs for care and certain specialty drugs. Under both plans, she could also see the doctor she preferred.
Another client, Ralph, enrolled in Medicare Parts A, B, D and the highest level of Medigap plans, something I call the “Cadillac of Coverage.” This occurred when he was 70, retired and reverting from his employer-sponsored plan to Medicare. At the time, he was not concerned with paying a higher up-front cost for this coverage; he wanted the greatest amount of choice and the least amount of restriction in his plans.
Two years later, however, having hardly used the healthcare system due to excellent health and few prescription drugs, he is considering a less expensive, Medicare Advantage option. He is comforted by knowing that he can make a change now for 2017 and reevaluate next year when Open Enrollment 2018 comes around. The opportunity will be there again so he does not have to live with this decision forever, if he’s not happy.
As you can see, it’s important to pay close attention during this open enrollment window, both for yourself and for anyone else you may care about who is on Medicare.
You can make a change that positions you to be a satisfied healthcare consumer, but you need to do your part by educating yourself, analyzing your situation, making decisions and acting to purchase new and different products, thus taking control of your choices!