The Medicare Fall Open Enrollment 2023 season is here and that means your email gets inundated with advertisements and your mailbox filled with Medicare brochures.
Every time you turn on the television you hear another commercial about Medicare plans. It is by far the most confusing time of year for most Medicare beneficiaries: October 15th – Dec. 7th
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What should I do during the Medicare Fall Open Enrollment?
Many beneficiaries know they need to be doing something during the Medicare Fall Open Enrollment each year, but they are not sure what. The constant radio and television ads cause people anxiety because they wonder if they should be making a change or doing SOMETHING.
The first day you can apply for a new Part D plan is October 15th. Your new plan will become effective January 1st, 2023.
Your Medicare Advantage or Part D Insurance plan provider will send you a document in September called the (ANOC) Annual Notice of Change. Take 15 minutes to sit down and review this document. It will tell you if the premium is changing, and also if your copays, drug formulary or pharmacy networks are changing.
The ANOC lists the plan’s changes side-by-side from 2022 to 2023. This makes it easy to compare changes to coverage.
What is the Medicare Fall Open Enrollment Period?
Also called the Annual Election Period, the Medicare Fall OEP came about with the introduction of Medicare Part D in 2006. It is an 8-week period every fall during which Medicare beneficiaries can enroll in, change, or disenroll from their Medicare Advantage and/or Part D drug plans.
Here’s why the period exists: Part D plans and Medicare Advantage plans get to re-file their benefits with Medicare each year.
This means the benefits and premiums on your plan can change or go up. So Medicare lets you have an election period each year to change your plan if you don’t like the changes to your existing coverage.
In short: your Part D benefits change every year, so you get an election period to change your plan if you don’t like those benefit changes.
The good news is that you do NOT have to change your plan if you like your plan. In fact, statistics show that the majority of beneficiaries do NOT make changes to their plan each year. However, you absolutely should be reviewing the upcoming plan changes every September.
How Do I Know if I Need to Make Changes to my Plan?
Reasons to Change Your Plan
You may be wondering: what would be a good reason to change your Part D plan or Medicare Advantage plan for 2023? Here are some of the most common reasons that plans change during Medicare Open Enrollment:
Your plan is dropping one of your important medications next year. Your Annual Notice of Change letter will specifically list any changes to its drug formulary for next year. The plan must disclose if they are dropping any medications. They must also tell you if a medication is moving to a more expensive tier for next year. If you take a brand name medication now that won’t be covered the next year, you may want to change during the OEP to another drug plan that will.
Your Medicare Advantage plan is dropping your doctor from its network. Unlike Medigap plans, Medicare Advantage plans have a network of doctors. If one of your doctors is leaving the plan’s network, you can use the Medicare OEP to switch to another plan that your doctor still participates in.
Your plan has a drastic increase in premium. Please note that the key word here is “drastic.” Inflation happens to medical insurance plans just like it does to auto insurance plans. If your auto insurance goes up $3/month next year, would you go to the hassle of changing it? Probably not. Likewise, if the only thing changing on your drug plan is a small increase in premium, you don’t have to switch. But if your drug plan goes up $25/month, you might look to see if any other plan is cost effective.
The key thing here is not to make it more difficult than it is. If you are happy and nothing significant is changing, don’t feel like you have to shop around just because you hear the word “Medicare” every 90 seconds on the radio.
Just review the ANOC. See if there are changes that make you want to shop around. Contact your agent for help if you do need to change.
What Changes Can I Make During Medicare Open Enrollment 2023?
Your choices for plan changes during the Medicare OEP?
Do nothing and your current Medicare coverage will automatically renew in 2023
Enroll in, leave, or change your Medicare Part D drug plan
Switch from Traditional Medicare to a Medicare Advantage plan
Switch from a Medicare Advantage plan back to Traditional Medicare
Change from one Medicare Advantage Plan to another
Keep in mind that Part D drug plans have no health questions. You can change to any other plan as long as you have either Medicare A and/or B and you live in the plan’s service area.
Medicare Advantage plans have only one health question about End Stage Renal Disease, so it’s also fairly easy to enroll in or change your Medicare Advantage plan as long as you don’t suffer from this particular health condition.
Medicare Advantage Changes for 2023
In 2018, the Bipartisan Budget Act brought about changes for Medicare Advantage plans. Whereas Original Medicare does not cover supplemental home health benefits, Medicare Advantage plans are now able to include them.
If you are looking at Medicare Advantage plans, you may notice that many of them will now include some supplement home health benefits. This may include personal support services in your own home, transportation to and from medical appointments, adult day care services, telehealth medical appointments, over-the-counter allowances, and meal delivery.
Major Part D Change for some 2023 Plans
Earlier last year, the Trump administration rolled out a historic agreement with insulin drug manufacturers to cut costs for Medicare beneficiaries by up to 66%. This was big news as it impacts over 3 million seniors who rely on insulin to manage their diabetes.
The Senior Savings Model caps the copayment on insulin to $35 in every phase of Part D coverage except the catastrophic coverage phase. With this new model, diabetics who are enrolled in a participating plan will pay a maximum of $35 for their insulin even if they have not yet met their deductible.
If you are a Medicare beneficiary and you use insulin, you will want to select one of these new Part D plans to become effective on January 1, 2023. Use Medicare’s Plan Finder Tool to look through the plans available in your zip code.
It is important to list the insulin you use in your search as the insurance companies are not required to cover every type of insulin in formularies; they can choose specific insulin brands to offer. However, Senior Savings Model plans must cover at least one pen-dosage and one vial-dosage option for each type of insulin.
What’s Not Changing for 2023: Your Medigap Plan Benefits
Medigap Plans DO NOT change during the annual Medicare open enrollment period.
Because the Part D plans change annually, Medicare beneficiaries wonder if their Medigap (Medicare Supplement) plan benefits also change between Oct. 15 – Dec. 7 too.
The answer is NO.
Your Medigap plan has federally standardized benefits that do NOT change from year to year like Part D plans do.
If you have a Medigap Plan G or Plan N (or any other Medigap plan), nothing will change with the benefits. Your plan next year will continue to cover all the same benefits that it covered this year.
Rates May Change, Benefits Do Not
Medigap plans DO have rate increases annually, but the rate increase occurs on your policy anniversary date. If you originally bought your policy on January 1st of a past year, then your policy renewal does occur each year on January 1.
That means you would receive your notice of increase from your carrier in December. It just happens to occur along with the OEP, but it is not related to the Medicare Fall Open Enrollment Period.
Should You Shop Your Medigap Plan During the OEP?
Now that you know your Medigap benefits will not change, it’s completely up to you whether you want to try to shop it in fall. Some people do shop it since they are already comparing Part D, so that they can knock out both items on their to-do list for that year.
We often find people who have been on the same Medigap plan for years and have been fearful to change because the plan pays so well. Medigap plans are standardized.
For example, if you have a Plan G, and you find a lower premium for Plan G elsewhere, you can change carriers and the new Plan G policy will pay the same as your current one.
The Medicare OEP Does Not Prevent Underwriting on New Medigap Policies
Many people mistakenly believe that you can change your Medigap plan during the OEP without health questions.
That is not the case, because as said above, the OEP doesn’t pertain to Medigap. In most states, you will have to answer some health questions on that new application.
The insurance company can decide whether to accept or reject you.
People are surprised about this because the phrase “Open Enrollment Period” sounds like a time when you can openly change to another plan without restrictions. That is true, but it doesn’t apply to Medigap plans – only to Part D or Medicare Advantage.
Someone with Part D can change to another Part D plan – no health questions.
Someone with Medicare Advantage can change to another Medicare Advantage plan – one health question.
Changing from Medigap to Medigap – a whole page of health questions.
Medigap plans require you to pass medical underwriting unless you have a special circumstance which qualifies you for guaranteed issue. For example, if you move out of state mid-year, you’ll be given a Special Election Period.
You can use this short period to change to a plan offered in your new service area. If you don’t have a special election period, you’ll need to answer health questions to get approved for a new Medigap plan.
(It should be noted that a few states have something called the birthday rule. For example, California and Oregon have periods once a year where you can change to an equal or lesser policy during your birth month without health questions.) Most other states require underwriting.
Your Medicare Part B Premium Might Also Change in 2023
Medicare Part B premiums can go up from year to year.
Every year the federal government can adjust your Medicare Part B premium. Part B premiums are tied to the Cost of Living Adjustment in your Social Security benefits. Back in 1965, new enrollees paid $3/month for Medicare Part B. In 2022, new enrollees pay at least $170.10/month, but this will likely change for 2023. Some people pay more based on their household gross income.
Generally, Social Security issues a COLA inflation adjustment that increases your Social Security monthly income benefits, then the Part B premium usually also goes up.
Higher Income Earners in 2022
People with higher incomes already pay more for their Parts B and D. Due to the “doc fix” MACRA legislation in 2015, some high-income earners began paying even more in 2018.
Medicare beneficiaries with earnings above $91k as an individual and $182k as a married couple pay more for Part B in 2022. People in the highest bracket who earn more than $500k as an individual ($750k married) now pay $578.30 each for Part B each month. These amounts change every year!
You will receive a letter from Social Security around December or January each year. It will tell you what your new premium for Part B will next year. This will be based on your income from two years prior to today.
We know this stuff is confusing. That’s why agents like us exist to help guide you through the process.
If you are a policyholder who has reviewed your ANOC letter and you need help changing your plan, please call us to get the next steps on how to enroll.
If you are not a policyholder but are open to shopping your policy, give us a call at (248) 778-6070 or email at email@example.com