Medicare’s annual Open Enrollment season is underway, and I want to encourage all people with Medicare to review their current health and prescription drug coverage.
Medicare Advantage plan premiums have fallen to historic lows, dropping an average of 34% over the last three years. Many plans are offering a new insulin benefit that limits the maximum cost to $35 for a 30-day supply. By shopping around, you may be able to save money and find a plan that better meets your needs.
Open Enrollment runs through Dec. 7 of each year. During that time, you can change your Medicare health or drug coverage for the following year. You can switch to Original Medicare, or join or change a Medicare Advantage plan or Part D prescription drug plan. Any new coverage you select takes effect on Jan. 1, 2021.
Our updated Medicare Plan Finder (Medicare.gov/plan-compare) can help you compare the prices and benefits of Medicare Advantage plans, Original Medicare, Medicare drug plans and Medigap policies. This mobile-friendly tool works on smart phones, tablets and desktop computers. For beneficiaries who have created an account, we’ve personalized Plan Finder to generate a personal drug history so that prescription information will be auto-populated from personal Medicare claims history with accurate brand, dosage and frequency information. But anyone can browse options without creating an account.
Many Medicare drug plans and Medicare Advantage plans that include drug coverage are participating in a new insulin savings initiative. These plans now offer 30 days of insulin for $35 or less — an average savings of $446-per-year on out-of-pocket costs. To find a plan with lower-cost insulin, look for “Insulin Savings” on Medicare Plan Finder.
There are important differences between Original Medicare and Medicare Advantage. Here’s a brief summary:
With Original Medicare, you can go to any doctor or hospital that accepts Medicare, anywhere in the United States. In most cases, you don’t need a referral to see a specialist.
For services covered under Medicare Part B, you usually pay 20% of the Medicare-approved amount after you meet your deductible. You also pay a monthly premium for Part B.
If you choose to join a Part D drug plan, you’ll pay an additional monthly premium.
There’s no yearly limit on what you pay out-of-pocket, unless you have supplemental coverage, such as Medicare Supplement Insurance, also known as Medigap. Medigap can help pay your remaining out-of-pocket costs (like your 20% coinsurance). Or you can use coverage from a former employer or union, or from Medicaid.
Original Medicare covers most medically necessary services and supplies in hospitals, doctors’ offices and other health care settings. It doesn’t cover some benefits, including vision and most dental care.
In most cases, you don’t have to get a service or item approved ahead of time for Original Medicare to cover it.
Medicare Advantage Plans are offered by private insurers that provide your Medicare Part A and B benefits, in many cases, through a managed network similar to an HMO.
Usually, you’ll need to use doctors and other providers in the plan’s network and service area to get the lowest out-of-pocket costs. HMO model plans won’t cover providers outside the plan’s network and service area unless certain exceptions apply, such as emergency services.
You may need to get a referral to see a specialist, even if the specialist is in your plan’s network.
Out-of-pocket costs for Medicare Advantage vary, and plans may have lower out-of-pocket costs for certain services.
You may have to pay a monthly plan premium in addition to your monthly Part B premium. Some plans may have a $0 premium or may help pay all or part of your Part B premiums.
Plans have a yearly limit on what you pay out-of-pocket for services covered under Medicare Part A and Part B. Once you reach your plan’s limit, you pay nothing for services covered by Part A and Part B for the rest of the year.
Plans must cover all medically necessary services that Original Medicare covers. Most plans offer extra benefits that Original Medicare doesn’t cover, such as some vision, hearing, dental, benefits, as well as adult day health services, caregiver support, in-home support and home-based palliative care.
In some cases, you have to get a service or item approved ahead of time for the plan to cover it.
If you’d like free, personalized counseling on what Medicare options are right for you, call the nonprofit State Health Insurance and Assistance Program, or SHIP. To find the SHIP program in your state, go to shiptacenter.org. [Note: In Hawaiʻi, visit hawaiiship.org.]
Seema Verma is the administrator of the U.S. Centers for Medicare & Medicaid Services.