Medicare Open Enrollment Is Coming Up

If you are currently enrolled in Medicare, October 15 through December 7 is a good time to take another look at your coverage for the coming year. Changes made during Open Enrollment generally take effect January 1.

It can be easy to stick with the same plan year after year, especially if everything has been working well. But Medicare plans can change, and your healthcare needs may change, too. Taking a little time to review your coverage can help you avoid unexpected costs or coverage issues down the road.

What Should You Review?

When looking at your coverage, don't focus only on the monthly premium. Consider the bigger picture:

1. Prescription medications: Are your current medications covered, and what will they cost?

2. Doctors and specialists: If you have Medicare Advantage, are your preferred doctors and specialists still in-network?

3. Out-of-pocket costs: Look at deductibles, copays, coinsurance, and annual out-of-pocket limits.

4. Your healthcare needs: Has anything changed over the past year that could affect the coverage you need?

A plan with a low monthly premium is not necessarily the least expensive option overall. Prescription drug plans can vary significantly based on the medications you take, the pharmacy you use, and how those medications are covered.

If You Are Approaching 65

If you are turning 65 or planning to retire soon, don't wait until October to start thinking about Medicare. Your Initial Enrollment Period is separate from the annual Open Enrollment period.

The timing can be especially important if you are transitioning from employer-sponsored health insurance. Depending on your situation, delaying Medicare enrollment could result in a coverage gap or late-enrollment penalties.

It is also important to understand how Medicare works alongside other types of coverage. For example, simply moving from an employer health plan to COBRA does not necessarily mean you can delay Medicare enrollment.

Medicare and Your Retirement Plan

Medicare is an important part of the overall retirement planning picture. Healthcare premiums and out-of-pocket costs can have a meaningful impact on your retirement budget.

Your income can also affect what you pay for Medicare. Higher-income Medicare beneficiaries may pay additional premiums through IRMAA (Income-Related Monthly Adjustment Amount). Because these amounts can be based on income from two years earlier, tax and income planning can sometimes play a role in managing future Medicare costs.

For married couples, it is also important to consider what happens to a spouse's health insurance when one spouse retires and leaves an employer plan. The Medicare decision for one spouse may have an impact on the other spouse's coverage as well.

A Good Time to Review

If you are already on Medicare, mark October 15 through December 7 on your calendar and take some time to review your coverage.

If you are approaching 65 or planning to retire, start the process earlier. Medicare has several different enrollment periods and rules, and the right approach depends on your individual circumstances.

A little planning now can help you make sure your healthcare coverage continues to fit your needs and your overall retirement plan.

This article is intended for general educational purposes only and is not intended to provide Medicare, insurance, tax, or legal advice. Individual circumstances vary.