Fall has arrived, and with it your biggest opportunity to make Medicare changes.
Medicare’s annual Annual Enrollment Period (AEP) goes by many names. A couple of common ones are “annual election period” and “annual open enrollment period.” But they all refer to the same time frame, from Oct. 15 to Dec. 7, when Medicare users can make changes to their plans.
If you have a Medicare supplement (or medigap) plan, this period isn’t for you. But for all other Medicare users, OEP can be useful. It’s your annual opportunity to purchase, drop or switch your Medicare Advantage or Medicare Part D (prescription medication) plan.
You might wonder why you should even bother. If your plan is working, why change it? Well, 2 reasons: 1. Your plan can change from year to year, and 2. Your needs can change, too. Comparing plans once a year can help make sure you always have the best one for your life now, says Cindi Gatton, a board-certified patient advocate. She’s also the founder of Pathfinder Patient Advocacy Group in Atlanta.
“People think that once they have Medicare coverage in place, they never have to think about it again,” says Gatton. “But there’s a benefit to looking at their plan each year and potentially making changes.”
So go ahead and pull out your plan. Then ask yourself these 5 questions to determine whether you might be better off with something else.
And since you’re already doing a health plan checkup, now would be a good time to download the Optum Perks mobile app. It provides prescription medication discounts at more than 64,000 pharmacies.
Question 1: Can you still afford your current plan?
Think about the worst-case scenario. How well can you handle that financially?
To properly analyze a policy, you should look beyond the monthly premiums, says Gatton. Factor in your deductible, copays and prescription drug costs. “You need to make sure you have enough money in your savings account to cover all of these expenses every year,” she says. If your calculations have you experiencing sticker shock, ask yourself where you can save money.
One option might surprise you: You can accept a higher premium. Yes, you’ll pay more up front, but that may reduce your deductible or copays. It might even bring down your out-of-pocket maximum, which is the most you can be charged during a calendar year.
For Medicare Advantage plans, the average out-of-pocket maximum is $5,091 for in-network services and $9,208 for both in-network and out-of-network services. This is according to data collected by Kaiser Family Permanente. But you may be able to bring that potential cost down by paying more up front.
Ultimately, choosing a plan isn’t about any single number. It’s about looking at how all those numbers work together, says Gatton. If you’re confused by how these various cost-sharing elements work, you’re not alone. Check out this explainer: What’s left in my deductible? (And other common insurance questions).
Question 2: Do you have a rehabilitation plan?
It’s not an idle question. Every year, millions of adults over the age of 65 fall. And at least 300,000 of them are hospitalized for hip fractures, according to the Centers for Disease Control and Prevention. If this or something similar happens to you, you may end up spending days, if not weeks, in a rehabilitation center. “You need to ask yourself, ‘If I were hospitalized and needed rehab, what facilities would my Medicare plan send me to?’” says Gatton.
It’s a good idea to find out how the facilities in your area stack up to one another. Medicare’s website makes it easy to compare. It allows you to search by ZIP code and view data on the quality of care.
Once you find the facilities you like, check your plan. You want to make sure they’re covered. Hopefully you don’t need them, but it’s better to be prepared.
Question 3: Have you recently started taking any new medication? Or do you think there’s a possibility you will?
Plans offered through Medicare Advantage and Medicare Part D don’t cover every medication. Instead, each one follows a formulary, which is a list of covered medications. And that formulary can change from year to year.
During AEP, you want to find your plan’s formulary for the upcoming year and search it for all the medication you currently take. You should also consider the common medications associated with conditions you’re at high risk for — either because of a genetic predisposition or lifestyle factor.
“I’ve seen patients get stuck with bills for a new diagnosis of a chronic neurological illness like Parkinson’s or dementia,” says Teri Dreher, RN. She’s a board-certified patient advocate and owner of NShore Patient Advocates in Chicago. “Some of the medications for neurological issues are very expensive, and they’re not always covered by a patient’s Part D plan. As a result, you can end up paying hundreds or thousands of dollars out of pocket per month.”
(Suggested reading: What if my doctor prescribes a medication that my plan doesn’t cover?)
If you have an underlying medical condition such as diabetes, obesity or heart disease, you may also want to make sure your plan offers chronic care management, says Dreher. These types of programs provide condition-specific support and help keep you on track with treatment.
Question 4: Do you plan to do any traveling next year?
While original Medicare can be used nationwide at any provider that takes Medicare, Medicare Advantage plans work differently. They function like PPOs (preferred provider organizations) or HMOs (health maintenance organizations). Generally, that means you’re required to see providers within a defined network.
“Some of these plans don’t include coverage outside of a specific service area unless it’s an emergency,” explains Gatton. “If you have a second home somewhere, make sure you understand what exactly your travel coverage is.”
It’s important to understand how your network works. Some plans may say they cover medical care outside your service area, but if you read the fine print, you’ll realize your copayments and coinsurance go up for anything out of network.
International travelers should also know that original Medicare and Medicare Advantage don’t usually cover medical care outside the U.S. unless it’s an emergency or you’re on a cruise ship in U.S. territorial waters. If international medical coverage is a priority for you, consider a medigap policy. This is a supplement plan that you purchase instead of Medicare Advantage. (You can’t have medigap and Medicare Advantage at the same time.)
Question 5: Do you plan to have elective surgery next year?
If you know that 2022 will be the year of knee replacement or bariatric surgery, you should shop for plans accordingly. You need to make sure you have a plan that covers the procedure. And if it does, does it cover everything?
Do some math to figure out how much you’ll have to pay out of pocket through your deductible, copays and/or coinsurance. You should also check to see if the plan requires pre-authorization. That means your doctor has to let the insurer know that the procedure is medically necessary before it’s done. Otherwise, you may end up on the hook for the entire bill.
Finally, make sure all the doctors, hospitals, labs and other health care providers you’ll be using are in network with your health plan. This includes everyone from your surgeon to your anesthesiologist.
The job can feel overwhelming, so if you need help, consider speaking to someone from your local State Health Insurance Assistance Program (SHIP). The service provides free Medicare counseling.
And to save money at the pharmacy, download the free Optum Perks discount card. Then just present it at the register when you fill your prescription.