Medicare Open Enrollment Starts On October 15th. What Do You Need to Know?

By Lisa Strohm

If you’ve thought about retirement at all, you’re probably aware of Medicare, a federal insurance program designed for people older than 65. What you might not know is that with Medicare, there are many options to consider and details to keep in mind. Your Medicare decisions could have a significant impact your finances in retirement, especially if you are a woman. Not only do women tend to live longer than men, (1) but they also spend a third more on health care than men over their lifetimes. (2)

As we draw closer to 2018’s Medicare open enrollment period, let’s review what you need to know to make the best Medicare choices for your unique situation.

When Is Medicare Open Enrollment?

The Medicare open enrollment period happens at the same time every year due to the changes enacted in 2011. For coverage in 2019, open enrollment will run from October 15, 2018, to December 7, 2018. Once December 8th arrives, the enrollment period closes until the following October. During this time, current Medicare users can switch coverage or add or drop parts of their plan.

Open enrollment is not for those who have never signed up for Medicare, unless the open enrollment period also falls during your initial enrollment time, which begins three months before you turn 65 and ends three months after the month you turn 65. But if you only signed up for Medicare Parts A and B during your initial enrollment, open enrollment gives you the opportunity to make changes to your coverage.

What Are My Open Enrollment Options?

Here is an overview of the changes you can make to your Medicare plan during open enrollment:

  • If you have Parts A and B, you can switch to Medicare Part C (or Medicare Advantage), which is often contracted by outside companies that have an agreement with Medicare. This service includes the coverage of both Plan A and Plan B (Original Medicare), as well as additional services, like prescription drug coverage and private fee-for-service plans.
  • If you have Medicare Part C, you can switch back to Original Medicare (Parts A and B).
  • You can reevaluate your Part C plan and switch to a different Medicare Advantage plan.
  • If you already have Parts A and B, you can join or drop a Part D prescription drug plan. This part of Medicare adds the prescription drug coverage for Original Medicare, private fee-for-service plans, and some Medicare cost plans.
  • You can switch your Part D prescription drug plan to a different Part D plan.

What Will Medicare Cost?

The amount you will pay for Medicare insurance depends on a variety of factors. While many people choose Plan A, the premium for Plan B is paid automatically and costs about $134 monthly on average. The cost may vary depending on your income, whether or not you’re still working, and when you originally enrolled. Review the factors to get the best coverage.

As an example to demonstrate the differences in cost, if you worked for more than 10 years, your monthly cost for the Plan A premium is $0 because you paid it while you worked. But the costs get higher if you worked for fewer than 10 years, climbing to $422 a month.

The Plan B premium also offers coinsurance after you’ve paid your deductible. This means that for some services you’ll pay only 20% of the total cost.

Improving Coverage During Medicare Open Enrollment

Plan C and Plan D are known as the options with the most coverage. Financially speaking, they are the most comprehensive plans. If you have either the basic Plan A or Plan B, you can improve your coverage using Medigap. This will help you pay for some of the services that are not covered by the higher coverage plans. Part C is also a prudent choice because it provides for services like dental and hearing health, which are not covered by the basic insurance plans.

As you can see, Medicare is complicated and ever-evolving, so don’t try to handle the intricacies alone. At The Athena Network, we want to empower you to make financial decisions that will give you confidence in your future. We want to ensure that you have a plan to cover all aspects of your retirement and are taking full advantage of all the retirement benefits available to you. If you need help evaluating your Medicare options, reviewing your insurance coverage, or just want to ask a couple of questions, we’re here to help. Email me at lisa.strohm@the-athena-network.com, call 484.224.3439 or schedule your free introductory meeting online today!

About Lisa

Lisa Strohm, CFP®, MBA is the founder and CEO of The Athena Network and Good Life Advisors of the Lehigh Valley, fee-based wealth management firms. She specializes in providing financial planning, investment management, and life management services for women and their families across the U.S. With more than 18 years of industry experience, she sets her firms apart from traditional wealth management companies by focusing on providing clients with an educational, collaborative, supportive experience that inspires her clients to engage in their financial lives. If you have a question, please click this link to schedule a phone call today. To learn more, visit https://the-athena-network.com/ or connect with Lisa on LinkedIn and Facebook.

Investment advice and financial planning offered through Good Life Advisors, LLC, a registered investment advisor.  Good Life and The Athena Network are separate entities.

__________

(1) https://www.ssa.gov/planners/lifeexpectancy.html

(2) https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1361028/