So, have you started shopping yet? We don’t mean holiday shopping – we mean open enrollment shopping. We’re a few weeks into Medicare open enrollment, so your window of opportunity to shop for the right health insurance and drug coverage for 2025 is already flying by. You have until December 7th to evaluate plans and select the one that’s right for you.
Here on the Blog, we recognize that millions of Americans are experiencing open enrollment for the first time. In fact, if the oft-repeated statistic is true that 10,000 people in the U.S. turn 65 every day, this will be the first Medicare open enrollment for over 3.6 million people. So before open enrollment turns another day older, we’ll revisit a trusted source for retirement-related information, the experts at AARP.
The article to which we referred a year ago, written by Dena Bunis, is no longer on the AARP website, since it contained quite a lot of data specific to 2024. It has been replaced with this updated article on the changes to open enrollment taking place this year for plans beginning in 2025. Still, we liked Bunis’s original article, which highlighted six things you need to know to take advantage of this “shopping season.” While some of the specifics have changed, we think this is a generally helpful overview, so we’ve included and updated some of the original quotes.
Open Enrollment Potentially Affects 67 Million Americans
“If you are one of the nearly 67 million Americans who get health care through Medicare, it’s time to review your options and make sure you have the medical coverage you need at the most affordable price,” AARP’s Bunis writes. “For most enrollees, the six-week open enrollment period between October 15 and December 7 is the prime opportunity to take stock of your coverage and, if necessary, make changes.”
Because Medicare has enacted some significant new rules for 2025, we also urge you check out this Blog article from a few weeks ago. We summarized some of the new plan provisions, especially to Part D drug plans. What’s more, many Medicare Advantage plans that include prescription coverage are adjusting their terms and, in some cases, exiting some markets. It’s a major change to the Medicare landscape.
As we noted above, we’re already well into a window that’s only open for about six and a half weeks. With that, here are the six critical things to know from the AARP article.
Open Enrollment Tip #1: Don’t Ignore It
“Too many people let open enrollment come and go without checking to make sure their current coverage will take care of their medical needs and that they are getting the best deal financially,” says Bunis, and we agree. Perhaps because folks are complacent or the process seems too daunting, the majority blow off open enrollment entirely – a mistake some research says can cost money and create major coverage headaches.
The AARP article puts this “ignorance-is-bliss” attitude into perspective. “According to KFF, the nonprofit organization that closely tracks Medicare, in 2020 just 3 in 10 Medicare beneficiaries surveyed reported that they had compared their current coverage with other plans offered in their area,” it states. That’s a pretty paltry statistic, and from what we can gather, it hasn’t changed in more recent years.
Open Enrollment Tip #2: Know What You Can and Can’t Change
Knowing what’s possible during open enrollment is a good place to begin. “If you are on original Medicare,” says AARP, “it’s easy to switch to a Medicare Advantage (MA) plan if you choose to do so. And if you already have an MA plan and want to switch to a different MA plan, that’s also not a problem. MA plans are the private insurance alternative to original Medicare.”
This year, the Medicare Advantage market is roiled with confusion, a topic we delved into just a few weeks ago here on the Blog. That article has also been re-posted this week since the topic is so timely.
While switching to an MA plan is easy, as the article points out, leaving Medicare Advantage for Medigap coverage can be a challenge. “If you already have an MA plan and want to switch to original Medicare, you likely will have difficulty getting an affordable supplemental — or Medigap — plan to take care of some of your out-of-pocket costs,” Bunis writes.
The reason reverting to Medigap is tough involves Medicare’s rules. When first eligible, you can purchase a Medigap plan without evidence of insurability. “Once you have gotten beyond your seven-month initial enrollment period, which straddles your 65th birthday, Medigap insurers in most states are allowed to charge you high premiums or even refuse to offer you a policy, especially if you have any preexisting conditions,” says the article.
You need to check out your state’s coverage rules, or reach out to your local State Health Insurance Assistance Program (SHIP) for help.
Open Enrollment Tip #3: Consider More Than Just Premiums
As the AARP article warns, don’t succumb to the false allure of low premiums when choosing coverage, because low-premium plans can end up costing you more. Medicare comes with a wide array of what are referred to as out-of-pocket costs – expenses you have to pay for. Some of those costs change from year to year, and different plans cover different costs.
“Depending on which option you have (original or Medicare Advantage) and whether you get your prescription drugs through a standalone Part D prescription drug plan or through your MA plan, you’ll need to check to see how your various costs are changing for 2025,” AARP suggests. Here’s a rundown:
Part A (covers hospital, hospice and some home care): Technically, Part A comes with a monthly premium, but most people don’t pay it due to the Medicare taxes paid during their working life. If you don’t have a qualifying work history, Part A can cost you: in 2024 the premium can be as much as $505 per month. Your hospital charges under Medicare Advantage and Medigap plans will vary, so compare carefully.
Part B (covers doctor visits and other outpatient services): “All Medicare enrollees have to pay the monthly premium, which is $174.70 in 2024,” says AARP. It’s projected to rise to $185 in 2025. Part B premiums usually are deducted from Social Security benefits. Deductibles and copays for Part B services vary widely between plans, and some Medigap supplement plans cover these entirely, so it pays to shop.
Part D (covers prescription drugs): Big changes are coming for Part D plans in 2025, including a cap of $2,000 on out-of-pocket expenses. This Blog article and related links will tell you what you need to know.
Open Enrollment Tip #4: Ask Your Doctor!
The old adage to “ask your doctor” applies here as well. “As you weigh your options, talk to your doctors,” Bunis writes. “If you’re on original Medicare, you’ll want to make sure your providers still participate in Medicare. The vast majority of doctors in the U.S. do, but it doesn’t hurt to check.”
Checking to make certain your doctor is “in network” is vital if you have a Medicare Advantage plan. Remember, networks can change from year to year. Medicare Advantage plans save money in part by limiting which doctors you can see. “Ask [your doctors] what networks they do belong to,” AARP warns. “It can be expensive to go out-of-network if you have an MA plan.”
Open Enrollment Tip #5: Don’t Procrastinate!
Shopping for something as complex and important as health coverage takes a while, so don’t put it off. “You may need some time to work through whether you want to make changes to your coverage,” says AARP. “Take a look at the “Medicare and You” handbook that the Centers for Medicare & Medicaid Services publishes each year. The handbook is mailed to Medicare beneficiaries, or you can look at it online.”
There’s also a Medicare hot line (800-633-4227) as well as local State Health Insurance Assistance (SHIP) program for help. “But don’t drag your feet,” says the article. “The closer it gets to the end of open enrollment, the busier these folks get.”
Open Enrollment Tip #6: Other Chances to Switch Coverage
With all the urgency about open enrollment, even if you miss it, you may have an out. “If you don’t take advantage of the annual open enrollment period, October 15 to December 7, there are ways you can make changes at other times during the year,” the AARP article states. “If your circumstances change — you lose your job-based health insurance or move to a state where your current plan doesn’t do business, for example — you can qualify for a special enrollment period.”
Finally, for those already in a Medicare Advantage plan, there’s another opportunity to switch to another MA plan – or back to original Medicare – during the annual Medicare Advantage open enrollment period, from January 1 to March 31. But remember, you may find it harder to qualify for Medigap coverage the longer you wait.
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(originally reported at www.aarp.org)