5 Medicare Mistakes to Avoid
Medicare is full of twists and turns with surprises around every corner. It’s nearly impossible to learn every piece of Medicare information out there. However, there are five Medicare mistakes you should know about and how to avoid them.
Missing your Medigap Open Enrollment Period
Medicare has designated enrollment periods for each part of Medicare. The Medigap Open Enrollment Period (Medigap OEP) is one of the most essential periods you’ll have. Your Medigap OEP is based on your Part B effective date and lasts for six months. For example, if your Part B starts on March 1st, so does your Medigap OEP, and it will end on August 30th.
This enrollment period is so special because it is most beneficiaries’ only chance to apply for a Medigap plan with guaranteed approval. During your Medigap OEP, you don’t have to answer health questions, and therefore, can’t be turned down or charged a higher premium due to pre-existing conditions.
Thinking the carrier name matters when choosing a Medigap plan
Medigap plans come standardized, meaning the benefits are set by Medicare for each plan and don’t vary. For example, a Medigap Plan G through carrier A has the same benefits as a Medigap Plan G through carrier B does. This allows you to easily shop through all the carriers in your area so you can find the most cost-effective plan without worrying about losing benefits.
When choosing a Medigap plan, you should compare as many carriers as possible by their premiums, average rate increase history, and financial ratings, to name a few. You may find a Medigap plan through a lesser-known carrier is more cost-effective than a brand name carrier.
Believing the Annual Election Period is another Medigap OEP
Possibly one of the biggest Medicare mistakes is believing the Annual Election Period (AEP) is another Medigap OEP. The Medigap OEP is a one-time window for the majority of beneficiaries. The only Medicare beneficiaries who receive two Medigap OEPs are the ones who qualify for Medicare before age 65.
The AEP is only for enrolling in, changing, or dropping Medicare Advantage and Part D plans. It is not a chance for you to apply for a new Medigap plan without going through underwriting. Some states give their Medigap beneficiaries extra open enrollment windows, but these are in no way correlated with the AEP.
Falling for the attractive $0 premium for a Medicare Advantage plan
Medicare Advantage plans are very different from Medigap plans in several ways. For example, most Medicare Advantage plans have a $0 premium, while Medigap plans never have a $0 premium. Medicare Advantage plans are paid a monthly allowance by Medicare to help cover their enrollees’ medical needs.
This allowance and the cost-sharing you pay allow the Medicare Advantage plan to offer you a $0 premium. However, you shouldn’t be swooned with this attractive offer without first reviewing the plan in detail. The plan may be a cost-effective option for you, but you need to compare it with others before choosing it solely based on premium.
Not reviewing a Medicare Advantage plan’s drug coverage before enrolling
When you purchase a Medigap plan, you also need to buy a Part D plan. However, most Medicare Advantage plans have a Part D plan built-in. Therefore, if you find that a Medicare Advantage plan is more cost-effective for you than a Medigap plan, be sure to review the plan’s included Part D benefits to make sure that both the medical plan and drug plan meet your needs.
Each Part D plan has a formulary, and those built into Medicare Advantage plans are no different. You will need to check to make sure the Part D plan includes all or most of your drugs and has cost-effective copays and coinsurance for each one compared to other built-in Part D plans.
Medicare is a whirlwind of a program and requires much research and preparation before enrolling. Be sure to remember these 5 Medicare mistakes to avoid so you can start Medicare off on the right foot.