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It’s almost the time of year for Medicare beneficiaries to give thought to their 2023 Medicare plan.
The program’s fall open enrollment period, when you can make changes that take effect Jan. 1, starts Oct. 15 and runs through Dec. 7. This window is for coverage related to prescription drug plans (Part D) and Advantage Plans (Part C) — meaning you can add, switch or drop those parts of your coverage.
While you are not required to do anything — your 2022 coverage generally would continue into 2023 — it’s nevertheless worth checking to see if your current plan would remain your best option.
“Oftentimes there are changes, but they can be good or bad,” said Ari Parker, a senior advisor at Chapter, a Medicare advisory firm. “Don’t assume the changes will benefit you.”
The upcoming window also is different from your initial enrollment period, which starts three months before your 65th birthday and ends three months after it (seven months total). That’s when you generally must sign up for Part A (inpatient care) and Part B (outpatient care) unless you meet an exception such as having acceptable coverage elsewhere.
Fall open enrollment touches most beneficiaries in one way or another due to the coverage they select. For instance, of Medicare’s 64.5 million beneficiaries (the majority of whom are age 65 or older), roughly 29 million choose to get their Parts A and B benefits delivered through Advantage Plans, which are likely to include prescription drug coverage. Another 20.5 million or so have standalone Part D plans.
Also be aware that the upcoming enrollment period is not related to Medicare supplement plans, aka “Medigap,” which have separate rules for enrolling
Generally, unless you live in a state whose rules differ or you meet an exception, you get a six-month window when you first enroll in Part B to purchase Medigap without having to answer health questions and potentially be penalized for pre-existing conditions. After that, while you can generally enroll in these policies at any time, you’d be subject to medical underwriting and could be rejected.
As you consider your 2023 coverage, be aware that some of the Medicare-related provisions included in the recently enacted Inflation Reduction Act take effect next year.
This includes a monthly $35 cap on cost-sharing for insulin under Part D, which will start on Jan. 1, according to a spokesperson for the Centers for Medicare & Medicaid Services. (Some plans may already offer a $35 cap.) Part D deductibles also won’t apply to the covered insulin product. For beneficiaries who take insulin through a traditional pump (which falls under Part B), the benefit starts July 1.
Additionally, there will no longer be any cost-sharing for recommended inoculations under Part D beginning Jan. 1, including the shingles vaccine.
Other provisions that are intended to reduce Part D spending take effect in later years. This includes eliminating an existing 5% coinsurance in the so-called catastrophic phase of coverage (2024) and capping beneficiaries’ annual out-of-pocket Part D spending at $2,000 (2025). Currently, there is no out-of-pocket limit, regardless of whether you get your coverage as a standalone Part D option or through an Advantage Plan.
Medicare also will be able to start negotiating the price of some drugs beginning in 2026.
Meanwhile, the standard monthly premiums for Part B will be $164.90 next year, down from $170.10 this year. Beneficiaries with higher income pay more through so-called income related adjustment amounts, or IRMAAs, whether for Part B or D (see charts further below).
If you already are enrolled in an Advantage Plan or drug plan, you should have received (or you will soon) a packet explaining changes to your coverage for 2023. This could include adjustments to monthly premiums, copays, deductibles, coinsurance or maximum out-of-pocket limit, or changes to drug coverage. Additionally, doctors and other health-care providers fall off and on plans from year-to-year, as do pharmacies.
“It’s important for people to make sure their providers are still participating in their plan for 2023 [and] their medications will be covered at the most cost-effective price possible,” said Elizabeth Gavino, founder of Lewin & Gavino and an independent broker and general agent for Medicare plans.
“There’s nothing worse than finding out on Jan. 1 that your medications will now be costing you $1,000 more per year,” Gavino said.
Be aware that while you can change your Advantage Plan early next year (Jan. 1 to March 31) if you discover it’s not a good fit, that’s not the case for standalone Part D plans.
If you shop for Advantage Plans during the upcoming fall enrollment, you may find they generally are offering more in the way of extra benefits. Many plans also have no premium (although you would still be responsible for your Part B premium).
In addition to dental, vision and hearing or gym membership, extras could include things like a credit — say, $200 or $400 per year — for over-the-counter medicines and other health-care supplies; a Part B premium “buyback,” which means your plan rebates you a portion or all of your Part B premium; and transportation to and from doctor’s appointments or other providers.
However, while the added benefits can be appealing, it’s important to know that those extras can change from year to year, said Danielle Roberts, co-founder of insurance firm Boomer Benefits. And, she said, you should make sure the plan meets your medical needs before considering additional benefits.
Advantage Plans also come with out-of-pocket spending caps, unlike original Medicare (only Parts A and B). But those limits can differ among plans, as can deductibles and other cost-sharing, which makes it worthwhile considering those expenses in addition to the monthly premium.
Also, If you consider enlisting the help of an agent or broker, be sure they take the time to weigh all the coverage options available in your area from various insurers. And think twice before responding to a TV commercial.
Medicare officials recently cracked down on aggressive and potentially misleading sales tactics from third-party marketers with some new rules, but you may still be exposed to the tamer ads (or other sales efforts) and end up in a plan that wouldn’t have been the best option if all were considered.
“The commercials and phone calls can be hard to ignore during this time of the year, but be cautious of the fine print,” Roberts said. “Many plans seem great on the surface, but you’ll want to look at all the plan details before enrolling.”