Medicare Open Enrollment: A Checklist for Advisors and Clients
It’s not uncommon for Medicare plans to change from year to year. As we head into the annual enrollment period, your client should review any changes in their plan to be sure the plan still aligns with their needs.
Changes in the Client’s Health
Your client’s health situation may have changed over the past year. This could include:
A new health diagnosis
Planned health or surgical procedures
New prescription medications
These and a host of other changes in your client’s health situation can be a good reason for your client to review their current Medicare coverage and consider making a change. Different plans may cover different procedures and other services in different ways. Some plans may not cover certain procedures or services to the extent that others do.
In the case of prescription medications, coverage under Part D or Medicare Advantage plans can vary. Certain prescription medications may be covered to a greater or lesser extent under certain drug plans or Medicare Advantage plans. Medicare Advantage plans have a formulary, which is a list of covered prescription drugs.
A change in your client’s health situation necessitating new medications, a certain health or surgical procedure or other services can be a good reason to look into different Medicare coverage during the annual enrollment period.
New Doctors or Other Providers
Your client may have changed doctors or added additional doctors due to a change in their health situation. The new doctor(s) or other medical professionals may not be a part of your client’s existing plan’s network. This could result in higher out-of-pocket costs for treatment.
This is something that your clients need to stay on top of over time as well. Providers included in the plan’s network can change, and these changes may be a good reason for your client to look at other Medicare plan options.
Medicare Advantage Open Enrollment
Besides the annual enrollment period for Medicare that runs from Oct. 15 to Dec. 7, there is also an open enrollment period for Medicare Advantage plans that runs from January 1 to March 31 each year.
If your client is enrolled in a Medicare Advantage plan, this is the time when they can switch to another Medicare Advantage plan, or switch to original Medicare and join a separate Medicare prescription drug plan. They are limited to one switch during this time period.
If this is something your client is considering, it is important that they compare their total coverage under both options to see which option is the better deal for them. There may also be a time limit for them to enroll in a Medigap plan without being subject to a medical exam requirement.
If your client switches from a Medicare Advantage plan to original Medicare, they will generally want to enroll in a Medicare Part D prescription drug plan. They will also want to enroll in a Part D plan if they didn’t do so when they were first eligible to enroll in Medicare. Failure to enroll in an approved drug plan when first eligible can result in permanent penalties if your client did not have other creditable coverage.
Roger Wohlner is a financial writer with over 20 years of industry experience as a financial advisor.
