Clock Ticking to Change Medicare Plans

Time is running out. October 15 to December 7 is when all Medicare subscribers can change their Medicare health plan and prescription drug coverage for 2015.  Changes made to your coverage will take effect the first of the New Year.  Even if you are satisfied with your current Medicare coverage, it is important to look at other Medicare options in your area that may better suit your individual needs in the upcoming year.

Mitchell Clark, senior communications associate at the Medicare Rights Center, offered the following important facts to consider when reviewing your medicare coverages. Here is his advice:

Boomer: What changes and updates have been made with Medicare for 2015 and what effect if any, has health care reform had on Medicare?

Clark: Since the Affordable Care Act was enacted in 2010, seniors and people with disabilities continue to be protected from significant increases in costs, benefits remain stable and access to higher-quality Medicare Advantage and Part D plans is strong. They have also seen a plan market with lower average premiums, higher enrollment and lower prescription drug costs.

In 2015, the Part D doughnut hole will continue to close with coverage of brand name drugs increasing to 55% of the cost of the drug in the doughnut hole, while generic drug coverage will increase to 35%. Also, the standard Medicare Part B premium will not increase in 2015 and thus will remain the same for the third consecutive year at $104.90 per month.

Boomer: What questions do I need to ask before enrolling in a supplemental Medicare health plan?

Clark: Medigap policies are health insurance policies sold by private insurance companies. If you have a Medigap policy, Original Medicare first pays its share for your care, and then Medigap pays all or part of the remaining costs, including deductibles, coinsurance and copayments. Medigaps may also cover some health care that Medicare doesn’t cover at all. Medigaps only work with Original Medicare; not Medicare Advantage plans.

Before you buy a Medigap, be sure to do your research:

• Make sure you need a Medigap. Remember that you only need a Medigap if you want to keep Original Medicare. If you want to enroll in a Medicare Advantage plan, Medigaps do not apply to you.
• Learn when you have the right to buy a Medigap so you can time your enrollment wisely. In most states, you have a limited window of time to buy a Medigap policy if you are age 65 or older. If you are under age 65, your ability to enroll in a Medigap is typically more limited.
• Once you decide you need a Medigap and you are able to enroll into a Medigap, compare the different types of policies that exist. There are 10 different standardized policies and you need to select the best one for you.
• Learn how a Medigap should cover prior medical conditions to know if any of your medical costs may be excluded. Depending upon your circumstances, a Medigap can exclude coverage for prior medical conditions for a limited amount of time.
• Find out how Medigap premiums are priced so you can make adequate cost comparisons.  It’s important to understand the ways that insurers set premiums to find the best deal for you.
• Have a list of questions to ask when you shop for a Medigap to remind you what you should consider.  Buying a Medigap can be a confusing experience. Relying on written questions can help you stay organized and simplify the process.

Boomer: What will my Medicare coverage cost me in 2015?  Are there programs available to help pay Medicare premiums.   If I do not take part B do I face a penalty?

Clark: In 2015, the Part A deductible will be $1,260. People with Medicare must pay this deductible for each benefit period before Medicare will begin covering 100% of the cost of their inpatient care for up to 60 days.

The Part B (medical insurance) monthly premium will remain $104.90 in 2015, and the Part B deductible will continue to be $147.

There are federal and state programs that may help pay your Medicare costs if you have limited finances. To learn about these programs and your eligibility, contact your State Health Insurance Assistance Program (SHIP) at www.shiptalk.org.

Boomer: What are my options if my Medicare advantage plan is no longer available the end of this year?

Clark: If your plan is terminated or no longer participating in Medicare you are entitled to a Special Enrollment Period (SEP), and have until February 28 to choose a new plan. Your new coverage will begin the first of the month after you enroll. If you would like your coverage to begin on January 1, then you must enroll in your new plan by December 31.

If you do not choose a new plan, you will automatically be enrolled in Original Medicare (if your Medicare Advantage plan is terminating) or you will lose drug coverage (if your drug plan is terminating).

Note, however, that if you were in a Medicare Advantage plan with prescription drug coverage that terminated and choose Original Medicare or allow yourself to be automatically enrolled in Original Medicare, you must also choose a Part D plan or else you may lose drug coverage.

Boomer: What if I am still working and have insurance do I need to enroll at age 65?  Can I get a policy in the marketplace if I have Medicare?

Clark: If you have health coverage through your or your spouse’s current employer you should talk to the employer when you become eligible for Mediare to see how the employer insurance will work with Medicare.

If there are 20 or more employees at the company where you or your spouse works, then the employer health insurance is primary—some people choose not to take Part B when they become eligible and have primary coverage through an employer.

If there are fewer than 20 employees at the company where you or your spouse currently work, Medicare is your primary coverage. You should not delay enrollment into Part B. If you decline Part B, you will have no primary insurance, which is usually like having no insurance at all.

In either case, if you have insurance from a current employer you qualify for a Special Enrollment Period. During this period, you can enroll in Part B without penalty. This Special Enrollment Period allows you to enroll in Part B at anytime while you or your spouse are still working and for up to eight months after you lose your employer coverage or stop working.

It is important to remember that COBRA and retiree insurance are not considered current employer insurance and you will not have a Special Enrollment Period if you have COBRA or retiree insurance. If you have COBRA or retiree insurance and delay enrollment in Part B you may have to pay a penalty when go to sign up.

If your work status changes Medicare may change how it works with your employer insurance. Examples of changes in work status include retiring and taking COBRA. You should also call Social Security when your work status changes.

If you already have Medicare, you should not enroll in a Marketplace plan.

There are many reasons it is not a good idea to take a Marketplace Qualified Health Plan (QHP) over Medicare:

1. It is illegal for someone to sell you a QHP if they know you have Medicare.
2. You are not eligible for any tax credits to help pay for QHP premiums, and full QHP premiums are more costly than your Medicare, Medigap or Part D premiums.
3. There is no guarantee that a QHP will pay for your health costs if you drop Medicare to take a QHP. In many cases, when someone is eligible for Medicare but does not have it, the insurance they do have can refuse to cover most if not all of their health care costs. This means that you may have little or no coverage if you rely on a QHP for health coverage.

Be aware that Medicare Advantage plans, Medigap supplemental policies and stand-alone Part D plans will not be sold through the Marketplaces.

Open Enrollment for the Marketplaces overlaps with Medicare Fall Open Enrollment. These enrollment periods are not the same. People with Medicare should use the Fall Open Enrollment Period (October 15-December 7) to review how they get their Medicare and make any changes to their coverage for next year.