Medicare Open Enrollment 2017 is happening right now. You may not know, but for your sake, should know, that Medicare Open Enrollment 2017 started October 16, 2016 and runs through December 7, 2016. The significance of it is huge. It is the chance to either keep the Medicare options you selected at about this time last year or change them.
Let’s review the terminology and the alphabet of Medicare.
Medicare in its broadest sense, is a federally funded health program for individuals over the age of 65, certain disabled people, and those with end stage renal disease. It is funded by taxes.
- Part A is hospital insurance. It pays hospital expenses, care in a skilled nursing facility, hospice, and some home health care.
- Part B covers certain doctor’s services, outpatient care, medical supplies, and certain preventative care.
- Part C refers to Medicare Advantage Plans. They are arrangements that offer a basket of benefits additional to Original Medicare. They are often promoted by saying that there is no additional premium for the additional services, but that depends on the plan.
- Also, Medicare Advantage Plans can carry out-of-pocket expenses as high as $6700 (although so far in 2016 they have run about $5,000 according to Medicare Resources. These amounts can result from deductibles, co-payments, and other factors that differ from amounts payable under regular Medicare. A good resource is Medicare.gov, and on this page you’ll find more information about Medicare Advantage and a more comprehensive discussion of the potential costs of a Part C plan.
- Part C Medicare Advantage Plans are issued by licensed insurance companies that are approved by Medicare. Your services are delivered by the Part C plan, not by Medicare itself. Medicare Advantage Plans may follow a model of Health Maintenance Organizations, Preferred Provider Organizations, private fee-for-service plans, special-needs plan, or a Medicare Medical Savings Account plan. Most, but not all, Medicare Advantage Plans also offer prescription drug coverage, so if you want that coverage, ask if it is included. Also, since Medicare Advantage Plans can operate on a network provider basis (depending on which you pick), it is important to look at the provider network to ensure that your doctors, or other acceptable ones, are included. Also keep in mind that doctors and other health care facilities can drop off the networks as they can with regular HMOs and PPOs.
- Part D of Medicare is prescription drug coverage. You can select it when you are first eligible for Medicare, or, if available, get drug coverage through a Medicare Advantage (Part C) plan. If you don’t enroll in a Part C plan and did not select drug coverage when you first became eligible for Medicare, a late enrollment penalty may be imposed if you later decide to get a Part D plan (although there are exceptions).
Understanding Medicare Supplement Insurance
Instead of joining a Part C Medicare Advantage Plan, you have the option of supplementing regular Medicare with a Medicare Supplement insurance policy (sometimes called a Medigap policy). These are insurance policies issued by licensed insurers that fill some of the holes left open by Medicare. The holes consist primarily of deductibles, co-payments, and coinsurance. Some of them also are triggered when you are outside of the U.S. (Medicare does not cover medical expenses outside of the country).
Here are some things to understand about Medicare Supplement (Medigap) insurance policies:
- You must have Medicare Parts A & B to get one.
- You pay a premium for it in addition to the monthly Part B premium paid to Medicare.
- All standardized Medigap policies are guaranteed renewable regardless of intervening health conditions.
- Medigap insurance policies sold after 2006 cannot offer prescription duig coverage. If you are just enrolling in Medicare and want drug coverage, you must buy Part D coverage.
The Importance of Medicare Open Enrollment
Medicare Open Enrollment is the time during which Medicare recipients can turn a page from their 2016 Medicare options to new ones for 2017. Specifically, it is the time during which you can:
- Change from Original Medicare to a Medicare Advantage Plan (but only if you have Medicare Parts A & B). Not all Medicare Advantage Plans operate in all areas, so you also have to live in the service areas of the one that you want. Also, you can’t have end stage renal disease.
- Switch from one Medicare Advantage Plan to another (again, if you live in its service area).
- Switch back from a Medicare Advantage Plan to Original Medicare.
- Switch to another Part D (prescription drug) Plan from the one you had last year
- Enroll in a Part D (prescription drug) Plan if you didn’t do so when you were first eligible for one. However, you may have to pay a late enrollment fee (there are some exceptions). But be careful…if you have drug coverage through a Medicare Advantage Plan and also buy a Part D plan, you will be removed from the Medicare Advantage Plan and sent back to Original Medicare.
Understanding Medicare open enrollment for 2017 requires patience, time, and thought. There are too many options that are confusing, and you need to consider your ability to pay more, pay for additional coverage, or stay the course. Either way, take the time to understand Medicare open enrollment; it’s critical for your future.