This year’s Medicare Open Enrollment Period – October 15, 2021 through December 7, 2021 – is the annual window of opportunity for Medicare recipients to evaluate their health and prescription drug coverage options. During this time, those eligible for Medicare can compare 2022 coverage options between Original Medicare, Medicare Advantage, and Part D prescription drug plans. Medicare health and drug plan costs and covered benefits can change from year to year, so recipients should evaluate their coverage annually to ensure it fits their healthcare needs.
During the annual enrollment period, you can:
- Switch from Original Medicare to Medicare Advantage (as long as you’re enrolled in both Medicare Part A and Part B, and you live in the Medicare Advantage plan’s service area).
- Switch from Medicare Advantage to Original Medicare (plus a Medicare Part D plan, and possibly a Medigap plan).
- Switch from one Medicare Advantage plan to another.
- Switch from one Medicare Part D prescription drug plan to another.
- Enroll in a Medicare Part D plan, if you didn’t enroll when you were first eligible for Medicare.
Any changes made during Open Enrollment are effective as of January 1, 2022.
Review your plan options
When evaluating your Medicare options, start with the following questions:
- Are you satisfied with the coverage and care you’re receiving with your current plan?
- Do your premium costs still fit your budget?
- Has your health status changed?
- Do you anticipate needing new (or pricier) prescription drugs?
If you are satisfied with your current Medicare plan and it remains available, you do not need to make changes; the coverage you have will continue.
Compare costs and benefits
Medicare is divided into the following parts:
- Part A, which pays for hospital services, is free if either you or your spouse paid Medicare payroll taxes for at least ten years. (People who aren’t eligible for free Part A can pay a monthly premium of several hundred dollars.)
- Part B covers doctor visits and outpatient services, and is paid by a monthly premium.
- Part D covers prescription drug costs, and has a monthly charge that varies depending on which plan you choose. In addition to premium costs, you’ll also be subject to co-payments, deductibles, and other out-of-pocket costs.
The annual enrollment period allows you to get estimates of costs and review benefits offered by Medicare health and drug plans in your area. You can also compare plans based on their star rating for quality and performance. Medicare.gov offers an online tool to find and compare plans available to you.
When to sign up
You are eligible for Medicare when you turn 65 (or younger for those with certain disabilities). If you already receive Social Security benefits, you will be automatically enrolled in Parts A and B. You can choose to turn down Part B, since it has a monthly cost; if you keep it, the cost will be deducted from Social Security if you already claimed benefits.
Those who have not started Social Security will need to enroll in Parts A and B. The seven-month initial enrollment period begins three months before the month you turn 65 and ends three months after your birthday month. To ensure coverage starts by the time you turn 65, sign up in the first three months.
If you are still working and have health insurance through your employer (or if you’re covered by your working spouse’s employer coverage) you may be able to delay signing up for Medicare. However, you must sign up for Medicare within eight months of losing your employer’s coverage to avoid significant penalties when you do eventually enroll.
Planning ahead
Heading into your retirement years brings a number of new topics to understand, and Medicare may be among the most confusing. Figuring out when to enroll, what to enroll in, and what coverage will be best for you can be challenging, and further complicated by changing rules and requirements.
Our team is here to help. If you or a family member have questions about your existing Medicare plan or you are a new Medicare recipient, consult your advisor to discuss your options and plan your next steps.
