More than 65 million Americans will soon be bombarded with ads for Medicare healthcare plans whose open enrollment begins October 15 and runs through December 7.
Each year, Medicare health and drug plans can change things like cost, coverage, and what providers and pharmacies are in their networks. During open enrollment, people with Medicare can change their health plans and prescription drug coverage for the following year to better meet their needs -- whether dictated by health changes, finances or something else.
The options, though, seem endless.
You can choose the federal government’s original Medicare and its drug supplement, or pick from a growing number of Medicare Advantage plans offered by private insurers approved by Medicare. Last year, nearly 4,000 Medicare Advantage plans were available nationwide, according to the nonprofit KFF, which focuses on healthcare policy. The average Medicare beneficiary could choose from 43 of those plans, more than double the average number available in 2018 and the highest since KFF began tracking options in 2010.
No wonder choosing a healthcare plan can feel overwhelming and confusing. Nevertheless, it’s an important decision that can hit your budget hard if you’re not careful.
With so much at stake, here's what you need to know to make the right decision.
Original, or traditional, Medicare:
Medicare Advantage (also known as Part C):
If you’re satisfied with your healthcare plan, you don’t need to do anything. You’ll automatically be re-enrolled as long as it’s still offered. Only about one-third of Medicare beneficiaries compare plans during the open enrollment period, KFF said.
However, experts strongly encourage you to review your coverage because plans often change, especially drug coverage, and you may end up paying more.
“It doesn’t hurt to look to see what other plans have,” said Louise Norris, health policy analyst for medicareresources.org, which provides consumers with Medicare information. “The worst is to ignore it and do nothing.”
To determine if you should switch plans, experts say you need to review what you have and determine if it still suits you.
There are three main things you should review because they often change, experts say:
Tips:Want to get the most from Medicare? An expert shares key advice
For the median retiree, twelve percent of their total retirement income went toward medical expenses, the Center for Retirement Research at Boston College said in 2018. For the median retiree, 25% of their Social Security benefits went towards medical costs. In total, the median retiree spent $4,311 on medical expenses, with most of that money going toward Medicare premiums.
Monthly Medicare Part B premiums in 2023 cost $164.90, with an annual deductible of $226. The Centers for Medicare & Medicaid Services (CMS) hasn’t said yet how much Part B will cost in 2024, but the annual Medicare Trustees report in March forecast the monthly price to rise to $174.80 in 2024.
The average total monthly Part D premium is projected to decrease to $55.50 in 2024 from $56.49 in 2023, according to CMS.
Yes.
“It’s easy for people to be attracted to advertisements that say they may be eligible for free dental or a grocery card,” said Anthony Kavouras, chief executive at OpenMedicare, which helps seniors find the right coverage plan. “Don't make a decision based on that. Oftentimes, marketing firms will lead with those benefits freebies.”
Instead, examine the plan and the fine print to make sure it’s from a reputable company, he said.
“Do it in October,” Kavouras said. “It leaves enough time so you’re not under pressure. It allows you to absorb information and come back. Also, after Thanksgiving, there’s usually a mad rush and you can’t get anyone on the phone. You may have to wait two to three hours to get through. There’s a sweet spot. Not the first few days (after open enrollment begins). Wait a week and then until Thanksgiving.”
Contact CMS, your local State Health Insurance Assistance Program (SHIP), or a broker and ask questions and see what they recommend. Be prepared with your drug information and list of doctors you see.
If you have a Medicare Advantage plan, you'll have one last chance to switch plans from January 1 through March 31 during the Medicare Advantage open enrollment period.
Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at [email protected] and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
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