How to Make the Most of the Medicare Annual Enrollment Period

The Medicare Annual Enrollment Period runs from October 15 to December 7 every year. There is a tendency to “set it and forget it.” Don’t fall victim to that mindset. Even if you had a great plan this year, it does not mean it’s going to meet your needs next year.

This article will review what you need to know about the Medicare Annual Enrollment Period (AEP), also known as Medicare Open Enrollment.

What You Can Do During the Medicare AEP

This is your opportunity to change Medicare plans. You can change from a Medicare Advantage plan to another Medicare Advantage plan or from a Part D prescription drug plan to another Part D plan.

You can also change from Original Medicare (Part A and Part B) to a Medicare Advantage plan (Part C) and vice versa. You will have to decide if Original Medicare’s nationwide network of providers meets your needs.

Then again, you may not mind having a smaller network of local providers if it means you can get extra supplemental benefits through a Medicare Advantage plan.

Finally, you can make decisions about your prescription drug coverage. You can choose a Medicare Advantage plan that has prescription drug coverage included.

Alternatively, you can sign up for a Part D plan. You can even drop your Part D coverage if you want. The only time you may want to do that, however, would be if you had creditable drug coverage from another source.

What You Cannot Do During the Medicare AEP

What you cannot do is sign up for Part A or Part B for the first time. The Medicare Annual Enrollment Period is for people who are already enrolled in Medicare.

To sign up for Medicare the first time, you need to use the Initial Enrollment Period (IEP). The IEP is centered around your 65th birthday. You have three months before and three months after your 65th birthday to enroll, or you could face late penalties.

People who work for an employer that hires at least 20 full-time employees can wait to sign up until they leave their job or lose their employer-sponsored health coverage, whichever comes first. They will not face late penalties if they sign up within eight months.

If you miss your Initial Enrollment Period, you need to wait until the General Enrollment Period to sign up for Part A and/or Part B. The General Enrollment Period happens once a year from January 1 to March 31.

Five Mistakes to Avoid During the Medicare Annual Enrollment Period

You do not check your Annual Notice of Change.

Medicare Advantage plans and Part D plans are run by insurance companies. The federal government requires them to cover certain services. That said, they can change what other services they cover and who provides them.

Once a year, they will send out an Annual Notice of Change. This document outlines what changes are coming in the new year regarding costs and coverage.

Check to make sure that there are no changes in your plan that could affect your care, including:

• Will your doctors be in your network next year?
• Are any medications you take being taken off your formulary or being moved to a higher tier (e.g., you pay more for higher tier medications)?
• Will the cost of your deductibles, coinsurance, and copayments change, and how much more could you end up paying?

You do not look into Medicare Advantage supplemental benefits.

If you need certain services, especially dental, hearing, and vision coverage, you may want to consider a Medicare Advantage plan. Original Medicare does not cover them, but many people on Medicare need dentures, hearing aids, and eyeglasses.

The Centers for Medicare & Medicaid Services recently allowed Medicare Advantage plans to expand what types of benefits they could offer.

In 2019, they extended what they considered “primarily healthcare-related” benefits. These could include (but were not limited to) adult daycare services, medical alert devices, rideshare services for health appointments, and even carpet cleaning for people with asthma.

In 2020, they added services specifically for people who had chronic conditions. Not all of those benefits had to be “primarily healthcare-related.” They included possible coverage for services like acupuncture, food and produce, pest control for the home, and subsidies for utilities like electricity, gas, and water.

You do not sign up for prescription drug coverage.

If you do not take prescription medications, you might be tempted to forego a Part D plan or a Medicare Advantage plan that includes Part D coverage. After all, why would you want to pay another premium?

The problem is that not signing up for a plan could leave you paying late penalties when you eventually do sign up for one. Those penalties will last as long as you are on Medicare unless you happen to qualify for the Part D Low Income Subsidy, known as Extra Help.

If you go without creditable coverage for 63 days, you could end up paying Medicare late fees for Part D when you finally do sign up for a Part D plan.

You sign up for the same plan as someone you know.

Word of mouth is always good for business, but it may not always be good for your health. While it can be helpful to hear that a certain company offers good customer service, that does not mean the plans they offer will cover the services you need.

Each person is unique. No one shares your specific medical history. They may not be on the same medications or use the same doctors. You need to find a plan tailored to your individual situation.

You do not shop around for a new plan.

“Set it and forget it” is the path of least resistance. The truth is that there could be a better plan for you out there.

Medicare Advantage plans are competing for your business. They could offer better prices or more benefits than other plans. Take the time to see how they compare on costs, and pick the one that will save you the most money.

Summary

If you are on Medicare, the Medicare Annual Enrollment Period is your opportunity to change to a different plan. Available from October 15 to December 7 each year, you can switch Medicare Advantage plans, between Part D plans, or change from Medicare Advantage to Original Medicare and vice versa.

Your medical needs may change from year to year. It’s important to take a look at each plan, considering the services they cover as well as their costs.

A Word from Verywell

The Medicare Annual Enrollment Period has a lot to offer. Don’t let it pass you by. You want to make sure that you are not only getting quality health care, but that you are also getting it at an affordable price.