The Medicare Annual Enrollment Period (AEP) occurs every year and lasts from October 15 through December 7. If you are a current Medicare beneficiary, this is your chance to make changes to your plan. Switch from Original Medicare to a Medicare Advantage plan – or vice versa – or change your Medicare Part D Prescription Drug plan.
Unfortunately, Medicare can be an extremely confusing program. Many patients tell us they don’t even know where to begin, so we put together this little guide to help you make the most of Annual Enrollment and get the most bang for your Medicare buck.
The Medicare Alphabet
We’re going to use a lot of Medicare terms, so it makes sense to include a short explanation of each one before we get started.
- Medicare Part A: This is commonly referred to as hospital insurance and is one part of Original Medicare. Part A pays for covered inpatient hospital services.
- Medicare Part B: This is the second half of Original Medicare, commonly referred to as medical insurance. Part B pays for covered services such as doctor appointments, outpatient treatments, and lab work.
- Original Medicare: This includes Parts A and B. Original Medicare does not include prescription drug coverage.
- Medicare Part C: More commonly known as Medicare Advantage (MA), Part C resembles the traditional health insurance plan you may have had through an employer or union. Every Part C plan must cover the same services that Medicare Part B covers, but most offer additional services as well. For example, many MA plans include prescription drug coverage. Part C plans are offered by private insurers. Costs and details vary by plan.
- Medicare Part D: Also known as Medicare Prescription Drug Plans, Part D pays for covered prescriptions. You must have a Part D plan OR a Medicare Advantage plan that includes prescription drug coverage. Part D plans are also offered by private insurers, with costs and coverage details varying by plan and provider.
- Drug formulary: This is the list of covered prescription drugs. Typically, these include tiers, with your out-of-pocket costs rising along with the tier. Most plans range from three to five tiers, with the first tier including mostly generic drugs, and the highest tier being more specialized medications.
Below is an example of a 5-tier drug formulary, courtesy of Medicare Solutions.
What Can You Do During Medicare Annual Enrollment?
The Annual Enrollment Period is the time when Medicare beneficiaries can make changes to their Medicare plan. It applies to anyone who currently has Medicare. During AEP, you can:
- Switch from Original Medicare to a Medicare Advantage plan
- Switch from an MA plan back to Original Medicare
- Change to a new Medicare Advantage Plan
- Sign up for a Part D plan
- Change to a new Part D plan
Medicare Annual Enrollment Step 1: Review Your Current Healthcare Needs
Before you can determine whether your current Medicare coverage meets your needs, you must first determine what those needs are. Create a list of the following:
Who are your current providers? This includes your primary physician, any specialists you see, labs, clinics, long- or short-term care facilities, hospitals, and pharmacies. Essentially, any person or place that provides you healthcare services can be a provider.
What prescription drugs do you take? Create a list of all prescriptions you currently take.
Do you expect your needs to change within the next 12 months? Has your doctor advised that a chronic condition is worsening? Does he or she expect to start you on a new prescription? Do you have any procedures scheduled? Add these to your list as future medical needs.
What are your current plan costs? What do you currently pay for premiums, yearly deductible, co-pays, and co-insurance?
Medicare Annual Enrollment Step 2: Review Your Current Coverage
Every September, your Medicare plan sends you two documents: The Annual Notice of Change (ANOC) and Evidence of Coverage (EOC).
These may be the most important documents your plan sends you every year. And yet, many beneficiaries ignore them, mostly because they receive so much Medicare-related mail during the fall. Do not ignore the ANOC and EOC. These documents contain all of the information you need to know about your plan for the coming year.
Your plan sends you these documents because, like every other type of medical insurance, Medicare plans change every year. The ANOC and EOC tell you what changes your plan will see next year. Possible changes include:
- Costs: Your premium, deductible, and co-pays nearly always change from year to year.
- Covered services: If you have a Medicare Advantage plan, the ANOC informs you which services will no longer be covered next year, as well as any services being added.
- Provider network: Providers leave and enter networks every year. Ignoring these documents may result in you not realizing that your doctor or pharmacy is leaving your plan’s network next year.
- Drug formulary: Prescription drug plans regularly update their formularies. It is very common for beneficiaries to not realize their plan no longer covers one of their prescriptions until it’s time to pay, all because they didn’t read these annual notices.
The list you created in Step 1, combined with the ANOC and EOC, gives you everything you need to determine whether your current coverage will meet your needs next year.
Medicare Annual Enrollment Step 3: Compare Plan Options
It’s important to note that your plans aren’t the only ones that change from year to year. All Medicare plans do. That means that, a plan that was too expensive or restrictive for you this year may be the perfect plan for you next year.
Your goal as a consumer, in healthcare as in everything, is to get the best product available at the best price. The Medicare Plan Finder is a tool that helps you find all of the available plans in your area so that you may begin comparing them to your current coverage to find what best suits your needs.
This can be extremely confusing. Some beneficiaries prefer to use a broker. These agencies partner with numerous private insurance companies, which allows them to help clients find the best plan to fit their individual needs. You can do a Google search to find a Medicare broker in your area.
Schedule Your Appointment for Preventive Services
Medicare covers a wide array of preventive screenings and treatments, starting with the Welcome to Medicare preventive screening. After that, you get an annual wellness visit every 12 months. Your cost for these visits is zero, assuming your doctor accepts assignment (i.e. takes Medicare). These screenings are highly effective at discovering potential issues early, while they’re still easy – and cheap – to treat, which is why insurers cover them. If you haven’t yet had your annual wellness exam, schedule yours today.