Guest article by Ross Blair, CEO of Plan Prescriber
The annual enrollment period for next year’s Medicare Advantage and prescription drug plans ends Dec. 7. Whether you’re approaching age 65 or already enrolled in Medicare, you should take advantage of this once-a-year opportunity to review coverage options and see whether you are enrolled in the most cost-effective plan for your needs.
Research by PlanPrescriber.com shows that a large majority of Medicare beneficiaries could have saved hundreds of dollars last year by reviewing just one element of their coverage: their prescription drug plan.
While it may be easy to come up with other things you’d rather do right now, taking time now to review all of your coverage options could really pay off.
Like last year, the annual enrollment period is closing earlier than usual. Even though Medicare beneficiaries have eight weeks to select their coverage; last year, 42 percent of people waited until the last nine days to apply, according to research by PlanPrescriber.com. However, this is not a decision you want to rush or put off until the last minute. Last year, federal officials extended the Dec. 7 deadline by three days for certain people because of an influx of last-minute sign-ups. You can avoid the rush this year by starting to compare plans now.
We’ve compiled some important tips for people on Medicare to help ensure they pick the best Medicare Advantage or prescription drug coverage for their specific needs.
Understand the basics before filling in the gaps.
Understanding Medicare can be challenging, but it’s important to understand what Original Medicare (Parts A and B) cover before weighing other options. Once you understand the basics, you can compare products designed specifically to fill some of the different gaps in Medicare. These products include Medicare Part D stand-alone prescription drug plans, which cover the cost of most prescription drugs; Medicare supplement plans, which cover portions of the deductibles, coinsurance and out-of-pocket costs not covered by original Medicare; and Medicare Advantage plans, which bundle together the Part D drug benefit with some additional coverage for deductibles, coinsurance and out-of-pocket costs. Each type of supplemental coverage has different guidelines for when you can enroll, change and cancel your coverage.
Prescription drug plans can change every year, so check the benefits for 2013.
If you get coverage through a Medicare Advantage or prescription drug plan, know that most plans change their pricing and benefits each year. You can use an online tool to see whether and how your prescriptions drugs will be covered in 2013. According to our recent study, the average person could have saved $654 in 2012 by changing their coverage to a plan that covered their drugs at the lowest possible cost.
Factor in costs like copays and deductibles.
At first glance, it may appear best to go with the plan with the lowest premium. However, you are still responsible for out-of-pocket costs. Also consider such costs as doctor’s office copayments and deductibles. Those expenses can add up, meaning the plan with the lowest premium could cost you more in the long run.
If you’re turning 65 during the enrollment period, know the deadlines and Happy Birthday.
Hundreds of thousands of people will turn 65 during this year’s annual enrollment period. If you’re already getting Social Security benefits, you will be contacted a few months before you become eligible for Medicare and given the information you need. Most people are enrolled in Medicare Parts A and B (Original Medicare) automatically.
While you’re celebrating, keep in mind that other types of coverage have different deadlines that are important to remember:
- Part D prescription drug plans. For most people, once you become eligible for Parts A and B (Original Medicare), you have 63 days to enroll in Part D without penalty. It’s a good idea to enroll during the annual enrollment period, but you’ll likely have some additional flexibility based on your specific date of eligibility for Original Medicare.
- Medicare Advantage. You have three months to sign up after you enroll in Medicare Part A and Part B benefits. Otherwise, you’ll have to wait for next year’s annual enrollment period.
- Medicare Supplement insurance (Medigap). The Medicare Supplement Open Enrollment Period is six months, beginning the first day of the month in which you are both age 65 (or older) and enrolled in Medicare Part B. If you miss the Medicare Supplement Open Enrollment Period, your application could be declined if you have a pre-existing medical condition or you may be charged more for coverage.
Finally, remember that there’s no reason to enroll without help. Qualified professionals can help you understand your options and select a plan. You can get help through your State Health Insurance Assistance Program (SHIP), websites like PlanPrescriber.com, licensed health insurance agents who are certified to sell Medicare, or by calling 1-800-Medicare.
Ross Blair is President and CEO of Plan Prescriber, Inc., a leading provider of comparison tools and educational materials for Medicare-related insurance products.
