The Medicare Open Enrollment season is here and that means your mailbox gets bombarded with advertisements. What a headache, hey?
Every time you turn on the television you hear another commercial about Medicare plans. It is by far the most confusing time of year for most Medicare beneficiaries: October 15th – Dec. 7th (sigh).
Many beneficiaries know they need to be doing something during the fall each year, but they are not sure what. The constant radio and television ads cause people anxiety because they wonder if they should be making a change or doing SOMETHING.
Never fear. In this post I will explain what the annual Medicare Open Enrollment Period each fall is for. I’ll tell you what you absolutely should be doing every single year.
We’ll also talk about what things you CAN’T do during the Medicare Open Enrollment.
Rest assured, our agency helped thousands of beneficiaries just like you at this same time last year. We know a lot that can help you, and we’ve be created a checklist that will help you remember the steps below. You can download it here before you read on:
What is the 2019 Medicare Open Enrollment Period (OEP)?
Also called the Annual Election Period, the OEP came about with the introduction of Medicare Part D in 2006. Part D plans and Medicare Advantage plans get to re-file their benefits with Medicare each year.
This means the benefits and premiums on your plan can change or go up. So Medicare lets you have an election period each year to change your plan if you don’t like the changes to your existing coverage.
In short: your Part D benefits change every year, so you get an election period to change your plan if you don’t like those benefit changes.
Now, the good news is that you do NOT have to change your plan if you like your plan. In fact, statistics show that the majority of beneficiaries do NOT make changes to their plan each year. However, you absolutely should be reviewing the upcoming plan changes every September.
How Do I Know if I Need to Make Changes to my Plan?
Your Medicare Advantage or Part D Insurance plan provider will send you a document in September called the Annual Notice of Change. Take 15 minutes to sit down and review this document. It will tell you if the premium is changing, and also if your copays, drug formulary or pharmacy networks are changing.
The Annual Notice of Change lists the plan’s changes side-by-side from 2017 to 2018. This makes it easy to compare changes to coverage.
What Changes Can I Make During Medicare Open Enrollment 2019?
Your choices for plan changes during the Medicare OEP?
- Do nothing and your current Medicare coverage will automatically renew in 2019
- Enroll in, leave, or change your Medicare Part D drug plan
- Switch from Traditional Medicare to a Medicare Advantage plan
- Switch from a Medicare Advantage plan back to Traditional Medicare
- Change from one Medicare Advantage Plan to another
Keep in mind that Part D drug plans have no health questions. You can change to any other plan as long as you have either Medicare A and/or B and you live in the plan’s service area.
Medicare Advantage plans have only one health question about End Stage Renal Disease, so it’s also fairly easy to enroll in or change your Medicare Advantage plan.
Good Reasons to Change Your Plan
You may be wondering: what would be a good reason to change your Part D plan or Medicare Advantage plan in 2019? Here are some of the most common reasons that plans change during Medicare Open Enrollment:
- Your plan is dropping one of your important medications next year. Your Annual Notice of Change letter will specifically list any changes to its drug formulary for next year. The plan must disclose if they are dropping any medications. They must also tell you if a medication is moving to a more expensive tier for next year. If you take a brand name medication now that won’t be covered the next year, you may want to change during the OEP to another drug plan that will.
- Your Medicare Advantage plan is dropping your doctor from its network. Unlike Medigap plans, Medicare Advantage plans have a network of doctors. If one of your doctors is leaving the plan’s network, you can use the Medicare OEP to switch to another plan that your doctor still participates in.
- Your plan has a drastic increase in premium. Please note that the key word here is “drastic.” Inflation happens to medical insurance plans just like it does to auto insurance plans. If your auto insurance goes up $3/month next year, would you go to the hassle of changing it? Probably not. Likewise, if the only thing changing on your drug plan is a small increase in premium, you don’t have to switch. But if your drug plan goes up $20/month, you might look to see if any other plan is cost effective.
The key thing here is not to make it more difficult than it is. If you are happy and nothing significant is changing, don’t feel like you have to shop around just because you hear the word “medicare” every 90 seconds on the radio.
Just review the Annual Notice of Change. See if there are changes that make you want to shop around. Contact your agent for help if you do need to change.
What’s Not Changing for 2019: Your Medigap Plan Benefits
Because the Part D plans change annually, Medicare beneficiaries wonder if their Medigap (Medicare Supplement) plan benefits also change between Oct. 15 – Dec. 7 too.
The answer is NO.
Your Medigap plan has federally standardized benefits that do not change from year to year like Part D plans do.
Let me say that again because it is the most common question we get every year. Your Medigap benefits do not change year to year like your Part D plan does.
If you have a Medigap Plan F or Plan G or Plan N (or any other Medigap plan), rest assured that nothing will change with the benefits. Your plan next year will continue to cover all the same benefits that it covered this year.
Rates May Change, Benefits Do Not
Now, Medigap plans DO have rate increases annually, but the rate increase occurs on your policy anniversary date. If you originally bought your policy on January 1st of a past year, then your policy renewal does occur each year on January 1. That means you would receive your notice of increase from your carrier in December. It just happens to occur along with the OEP, but it is not related to the Medicare Open Enrollment Period.
Think of this like your auto insurance or homeowners insurance:
If you originally bought your homeowners insurance on June 1st, 2014, then every year on June 1st, you will get a rate increase. The same thing happens with Medicare supplement insurance. If your Medigap plan happens to renew each year in January because you originally bought it with a January 1st effective date, that is coincidental. The plan’s benefits are NOT changing, only the premium changes from year to year on Medigap plans.
Should You Shop Your Medigap Plan During the OEP?
Now that you know your Medigap benefits will not change, it’s completely up to you whether you want to try to shop it in fall. Some people do shop it since they are already comparing Part D, so that they can knock out both items on their to-do list for that year.
We often find people who have been on the same Medigap plan for years and have been fearful to change because the plan pays so well. Rest assured, Medigap plans are standardized.
They ALL pay great. Read my reviews on that here.
For example, if you have a Plan F, and you find a lower premium for Plan F elsewhere, you can change carriers and the new Plan F policy will pay every bit as well as your current one.Give us a call for a quick customized report showing options and rates in your zip code.
The Medicare OEP Does Not Prevent Underwriting on New Medigap Policies
Many people mistakenly believe that you can change your Medigap plan during the OEP without health questions.
That is not the case, because as we said above, the OEP doesn’t pertain to Medigap. In most states, you will have to answer some health questions on that new application. The insurance company can decide whether to accept or reject you.
People are surprised about this because the phrase “Open Enrollment Period” sounds like a time when you can openly change to another plan without restrictions. That is true, but it doesn’t apply to Medigap plans – only to Part D or Medicare Advantage.
For this reason, my team here at my agency uses the phrase Annual Election Period. It is less confusing to our clients. (I mean honestly, could they use any more confusing terms for this stuff??).
- Someone with Part D can change to another Part D plan – no health questions.
- Someone with Medicare Advantage can change to another Medicare Advantage plan – one health question.
- Changing from Medigap to Medigap – a whole page of health questions.
Medigap plans require you to pass medical underwriting unless you have a special circumstance which qualifies you for guaranteed issue. For example, if you move out of state mid-year, you’ll be given a Special Election Period.
You can use this short period to change to a plan offered in your new service area. If you don’t have a special election period, you’ll need to answer health questions to get approved for a new Medigap plan.
(We should also note that a few states have something called the birthday rule. For example, California and Oregon have periods once a year where you can change to an equal or lesser policy during your birth month without health questions.) Most other states require underwriting.
Your Medicare Part B Premium Might Also Change in 2019
Every year the federal government can adjust your Medicare Part B premium. Part B premiums are tied to the Cost of Living Adjustment in your Social Security benefits. Back in 1965, new enrollees paid $3/month for Medicare Part B. Today in 2018, new enrollees pay at least $134/month. Some people pay more based on their household gross income.
Generally, Social Security issues a COLA inflation adjustment that increases your Social Security monthly income benefits, then the Part B premium usually also goes up.
2019 Changes for Higher Income Earners
People with higher incomes already pay more for their Parts B and D. Due to the “doc fix” MACRA legislation in 2015, some high income earners began paying even more in 2018.
Medicare beneficiaries with earnings above $133,501 as an individual and $267,000 as a married couple now pay more than what they paid in 2017. People in the highest bracket who earn more than $214,000 as an individual ($428k married) now pay $428.60 each for Part B.
You will receive a letter from Social Security around December or January each year. It will tell you what your new premium for Part B will next year. This will be based on your income from two years prior to today.
Who Can Help You with Medicare Open Enrollment 2019?
We know this stuff is confusing. That’s why agents like us exist to help guide you through the process. If you haven’t already, be sure to download our handy checklist. It will help you make sure you don’t miss any of the steps we’ve discussed above. Download it here.
Due to the overwhelming demand for Part D help each year, our staff here at Boomer Benefits only helps our existing Medigap clients with their annual Part D analysis.
So if you need help and are open to shopping your Medigap policy, give us a call at 1-855-732-9055. However, if you only want help analyzing whether you should change your Part D, don’t worry! You can call Medicare directly for free help. You can reach them at 1-800-MEDICARE or by using the Drug Plan Finder Tool on Medicare’s website.
Do you have a question about the 2019 Medicare Open Enrollment Period? Feel free to post it below and I’ll be glad to answer.
Editor’s note: This post was originally published in 2014 and has been revamped, expanded and updated for accuracy and to deliver new information.