If you’re already enrolled in Medicare, it’s tempting to assume that once you’ve chosen your coverage, you’re set.
Unfortunately, Medicare doesn’t work in quite that way.
Plans can change from year to year. So can prescription costs, provider networks, and, of course, your own healthcare needs. That’s why Medicare Open Enrollment, which runs from October 15 through December 7 each year, is an important opportunity to make sure your coverage still works for you.
You don’t necessarily need to make a change. But you should take the time to review what you have.
Not sure where to start? Here’s a checklist.
- Start With What’s Changing in Your Current Plan
Before you start comparing alternatives, understand what’s happening with the coverage you already have.
Your plan should send you an Annual Notice of Change outlining changes to costs, coverage, and other plan details for the coming year. Don’t automatically file it away.
Look for changes to premiums, deductibles, copays, and other out-of-pocket costs. If you have a Medicare Advantage plan, check for changes to its provider network or benefits. If you have prescription drug coverage, review what’s changing there, too.
- Review Your Prescription Drugs
This is one of the most important items to check each year.
Prescription drug plans can change their formularies, which are the lists of medications they cover. The medication you’ve been taking may move to a different tier, cost more, or no longer be covered.
Your medications may have changed, too.
Make an updated list of everything you currently take, including dosage and frequency, and use that list when reviewing your Part D or Medicare Advantage prescription coverage.
- Make Sure Your Doctors Are Still in the Network
If you have Medicare Advantage, confirm that the doctors, specialists, hospitals, and other providers you want to use will still be in-network next year. If you’re considering another plan, check its network before making a change.
- Look Beyond the Monthly Premium
It’s easy to compare Medicare plans based on the monthly premium. But a lower premium doesn’t necessarily mean lower overall healthcare costs.
Consider deductibles, copays, coinsurance, prescription costs, and potential out-of-pocket expenses along with the premium.
- Consider Whether Your Healthcare Needs Have Changed
Sometimes the biggest change isn’t the plan. It’s you.
Did you receive a new diagnosis this year? Start seeing a specialist? Begin taking expensive medication? Are you anticipating a procedure or treatment next year?
You can’t predict every healthcare expense, but known health changes can help you evaluate your options for the coming year.
- Understand What Medicare Doesn’t Cover
Open Enrollment is also a good opportunity to remind yourself where Medicare coverage stops.
Original Medicare doesn’t cover everything. One important limitation to understand is that Medicare generally doesn’t cover most long-term or custodial care.
Depending on your coverage, you may also have expenses for dental, vision, hearing, and other services.
Understanding those gaps is important because healthcare planning doesn’t stop with choosing a Medicare plan. Consider those potential expenses as part of your broader retirement plan.
- If You Have Medigap, Know the Rules Before Making a Change
Medigap and Medicare Advantage work very differently, so switching between coverage types deserves careful consideration.
Your ability to purchase a Medigap policy later may depend on your circumstances, where you live, and whether you have guaranteed-issue rights. In some situations, an insurer may use medical underwriting when you apply.
In other words, don’t drop existing coverage assuming you can simply get it back later.
- Don’t Forget the Financial Planning Side: IRMAA
For higher-income Medicare beneficiaries, income can affect Medicare Part B and Part D premiums through the Income-Related Monthly Adjustment Amount, better known as IRMAA.
IRMAA generally uses income from two years earlier to determine your surcharge. That means financial decisions involving Roth conversions, capital gains, and retirement account distributions can potentially affect future Medicare premiums.
- Step Back and Look at the Bigger Picture
Medicare choices don’t exist in isolation. Before making a change, consider not only the coverage itself, but how the costs fit with your retirement income and other financial priorities.
You don’t need to become a Medicare expert. You just need to understand your coverage well enough to recognize when something deserves a closer look.
You May Not Need to Change Anything
A Medicare review doesn’t have to end with a new plan. After looking at your coverage, prescriptions, providers, and costs, you may decide you’re comfortable with what you already have.
That’s a perfectly good outcome.
Medicare Open Enrollment runs from October 15 through December 7. Before it begins, gather your plan information, update your medication list, and make note of any questions you want answered.
Then you’ll be ready to evaluate your options based on what actually matters to you.
