We are in the thick of Medicare open enrollment, meaning that seniors 65 and over now have the chance to enroll in—or switch to—a new healthcare plan that could save hundreds or even thousands of dollars in out-of-pocket costs.
Yet surprisingly, only 1 in 10 seniors voluntarily switch their plan each year, with most members staying put, even if their premiums have increased or their medications are dropped from their formulary. This can leave older patients on the hook for hefty out-of-pocket costs. Needless to say, enrollment can be a confusing process, but GoodRx is here to help.
When is open enrollment?
Medicare plans offer open enrollment from October 15th to December 7th. Keep in mind that this is different from the Affordable Care Act (ACA/Obamacare) open enrollment that lasts from November 1st to December 15th. (More to come on ACA enrollment soon.)
There is one exception. In 2017, seniors who live in hurricane-affected areas have until the end of December to enroll. This includes seniors in Alabama, Florida, Georgia, Mississippi, Louisiana, Texas, South Carolina, Texas, Puerto Rico, and the U.S. Virgin Islands. For more information, read here, or call 1-800-633-4227.
What’s changing in 2018?
- Most plans will have a preferred pharmacy network—99% to be exact, up from 85% last year and 7% in 2011. This means that your plan will offer greater savings on medications at certain pharmacies. In most cases, you will still have the option to go elsewhere, but you’ll pay more.
- Medicare Part D premiums are rising. According to The Kaiser Family Foundation, prices on standalone Part D drug plans have risen 9% from last year, with monthly premiums now averaging around $43.48. While 9% may not seem like much, keep in mind that premiums have risen a whopping 68% from 2006.
- But Medicare Advantage premiums are going down. Average monthly Medicare Advantage premiums will be around $30, down $2 from last year. Also, this year, most Medicare Advantage plans include drug coverage. Unfortunately, this drug coverage can be limited – with fewer drugs covered than in standard Medicare – so make sure you read the fine print before you commit!
- Good news for the donut hole. The coverage gap between the initial coverage limit and the out-of-pocket maximum is commonly known as the “donut hole.” During this coverage gap, you are responsible for a percentage of your drug costs. The good news? This percentage has been slowly declining. For brand name drugs you’ll pay 35% of a prescription price (down from 40% in 2017), and for generics, you’ll pay 44% of the price (down from 51% in 2017).
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Traditional Medicare or Medicare Advantage?
Medicare Advantage, also referred to as Medicare Part C, has increased in popularity over the past couple of years. But how does it differ from original Medicare, and is it better?
Medicare Advantage plans are run by private insurance companies that wrap Medicare Part A (hospital insurance) and Medicare Part B (medical insurance) into one plan. Some will even include prescription drug coverage (Medicare Part D). Advantage plans have a lot of benefits like coverage for outpatient services, and the ability to include dental, hearing, and vision coverage into your plan.
The trade off? Most Medicare Advantage plans limit you to certain doctors and hospitals, whereas people on original Medicare can visit any provider who accepts Medicare. If you’re comfortable with the network, though, these plans can be great ways to get great care.
Read here for more information on Medicare Advantage plans.
What plans are available?
Most seniors have around 20 Medicare plans to choose from, depending on where you live. If you live in a rural community, it may be harder to find a plan that suits you.
Overall, eight insurers dominate the marketplace. These include United Healthcare, Humana, Anthem, Blue Cross/Blue Shield, Aetna, Kaiser Permanente, Cigna, and WellCare. The plan finder from Medicare.gov is a great way to find the best insurer.
5 tips to help you save
- Watch your mail. If you are already enrolled, be sure to read over any mail you get from your insurer. Most insurers will send out an “annual notice of change” or “evidence of benefits” letter that details the changes you will see on your plan in the next year. If you see that your premiums are increasing, or a maintenance drug you take is being removed from the formulary, it might be time to think about switching.
- Use the Medicare.gov “Plan Finder.” This tool can help you find the best plan, and estimate your annual costs on each plan, based on your location and the medications you take.
- Don’t forget about the penalties. Prescription drug coverage, also known as Medicare Part D, is optional. Keep in mind that lofty penalties may apply if you fail to enroll when you are eligible. For more information on these penalties, and how to avoid them, read here.
- Check your plan’s network. This is especially important if you are enrolled in a Medicare Advantage plan. Contact your doctors, hospitals and other providers you may frequent to ensure that they are covered under your plan. This step can ensure that you won’t have to find a new provider, or pay out of pocket.
- Use GoodRx. Whether you’re choosing a plan, or enrolling in a new one, shopping around can still help you save. In fact, for the top 20 Medicare plans in America, 66% of prescriptions can be purchased for less than your typical Medicare co-pay using discounts found on GoodRx. Moral of the story? It pays to use GoodRx!
For any additional questions, be sure to read through this FAQ from The Kaiser Family Foundation.