I would like to take a minute or two to help clarify what can be a confusing part of Medicare. I am talking about the approaching annual Open Enrollment period. In my 17 years counseling people in the areas of retirement, health coverage and life insurance/financial instruments, Open Enrollment stands out as one of the most misunderstood parts of Medicare.
Medicare’s annual Open Enrollment period is from October 15 through December 7 each year (usually). This is the time of year when a person who is already getting Medicare benefits (due to age - 65 or older, or due to full disability at any age) can look at health or prescription plan details for the upcoming year and schedule to change to a new plan, if desired, starting January 1.
Here is a reminder of Medicare’s parts:
Part A = Hospital - This includes hospital stays and rehabilitation or “rehab” after a hospital stay.
Part B = Medical - This includes in and outpatient surgeries, physicals, lab work and medical equipment.
Part C = Medicare Advantage - (Or Medicare HMO/PPO plans) These are medical insurance plans from companies that are contracted by Medicare and can also cover prescriptions. Network type coverage.
Part D = Prescription plans – Approximately 22 different Medicare approved plans offered by insurance companies that offer savings on prescription drugs.
This annual Open Enrollment only applies to Part C Medicare Advantage plans and Part D Prescription plans. So people who are already on a Medicare Advantage or Prescription plan can change to a different plan for the next year. Also, people (already on Medicare) who want to begin one of these plans for the first time can enroll to start on January 1 during this time. People who want to end their Part C Medicare Advantage(HMO/PPO) plan can also do so, and go back to “Original Medicare” (which means Parts A and B) on January 1 during the annual Open Enrollment. Medicare C and D plans are run so that their costs and prices do not change through the calendar year. What you sign up for is what you get. They may only change in the next new year. But each fall during Open Enrollment, the new year’s plan costs, prices and benefits are announced so people can compare with their current plan. People who don’t wish to switch plans for the new year simply keep the plan they are on by default without having to re-apply.
Medicare Supplemental plans coordinate with Parts A and B, and are not affected by the annual Open Enrollment period. Many people wrongly assume that everything under Medicare has an annual Open Enrollment. I recommend supplemental plans because they give people more freedom to choose doctors and clinics, unlike Part C (Medicare Advantage) plans which have network restrictions. But because supplemental plans are offered by private insurance companies and are not a sub-contractor of the federal government like Part C plans are, the annual Open Enrollment period does not apply. Basically, supplemental insurance accepts everyone who applies when they are first going on Medicare at 65, or when they take Medicare benefits at a later age. But switching to a different supplement plan after age 65 and 5 months (or 5 months after Medicare Part B starts- at a later age) is dependent on one’s health. Supplemental insurance companies are allowed to ask health and medical questions of applicants before accepting them for coverage. Usually, the only time a person is guaranteed to be accepted for a supplement is when they are first going on Medicare. People with supplemental plans can also have a Part D prescription plan, and do have the ability to compare and switch prescription plans for the next year during this annual Open Enrollment period. HRC Insurance Services is committed to helping our clients understand Medicare benefits and make the most of this ability to compare and change drug plans each year. I urge you to get the most “bang for the buck” by having a professional guide you through Medicare coverage, supplemental coverage, and the brief enrollment and disenrollment periods offered by Medicare each year.
Ken Kitchen, GM of Life and Health