Open enrollment in Medicare allows retirees to shop for new health insurance

Medicare open enrollment for 2025 is scheduled to begin Tuesday.

Beneficiaries have from October 15 to December 7 to review their Medicare coverage options and select new plans for next year.

Experts say this is an important opportunity that retirees shouldn't ignore.

However, only 30% of Medicare recipients review their options each year, according to a study by KFF, a health policy research provider.

“Every year it makes sense to compare insurance options because people's needs change from year to year and plans change, too,” said Tricia Neuman, managing director of the Medicare policy program at KFF.

“These comparisons can make a big difference in coverage and costs,” she said.

The new year will bring new changes to Medicare, meaning beneficiaries may want to do careful research during this open enrollment season.

“My best advice would be to start early,” said Ryan Ramsey, deputy director of health insurance and benefits at the National Council on Aging.

During Medicare open enrollment, retirees can choose new health insurance and prescription drug plans.

You can switch from original Medicare plans, which are provided by the federal government, to Medicare Advantage plans, which are privately administered. You can also switch from Medicare Advantage to Original Medicare or change Medicare Advantage plans.

Original Medicare includes Medicare Parts A and B. Medicare Part A covers care provided by hospitals, skilled nursing facilities, and hospices, as well as some home health care. Medicare Part B covers physician services, outpatient care, medical services, and preventive services.

Original Medicare beneficiaries can opt for additional prescription drug coverage by enrolling in a Medicare Part D plan, or additional coverage for out-of-pocket costs through Medicare supplemental insurance or Medigap.

Alternatively, beneficiaries can choose a private Medicare Advantage plan, which includes Medicare Parts A and B and may also include vision, dental, hearing and prescription drug coverage.

In 2025, a $2,000 cap on Medicare Part D out-of-pocket costs will go into effect.

The change, which was part of the Inflation Reduction Act of 2022, is “great news” for retirees who need to take expensive prescription drugs, said Philip Moeller, author of “Get What's Yours for Medicare: Maximize Your Coverage, Minimize Your.” Cost.”

However, insurance companies may seek to pass on the higher Medicare Part D and other prescription coverage costs they now incur because of these changes, Moeller explained. This can take the form of higher copays for prescriptions, more expensive levels of coverage for certain medications, or eliminating coverage for some medications altogether.

“This means that consumers should be very vigilant about open enrollment,” Moeller said.

In particular, the Biden-Harris administration has taken action to protect beneficiaries from large increases by capping the allowable increase in Part D premiums to $35 per month in 2025, KFF's Neuman said.

Retirees should also pay attention to a change in Medicare Advantage coverage, Moeller said.

In some cases, private insurers may have canceled their plans or moved from geographic areas that are no longer attractive to their business. While retirees may be inclined to use Medicare Advantage plans for their prescription drug coverage, they should be aware of possible changes these plans could make that affect the overall costs they must pay, Moeller explained .

People who have Medicare Advantage and want to switch to original Medicare should be aware that they may not be able to get Medigap insurance if they have a pre-existing condition, Neuman said.

Four states in particular have protections in place to prevent this: Connecticut, Maine, Massachusetts and New York.

“In other states, it may be more difficult for people to opt out of a Medicare Advantage plan and find Medigap coverage if they have a serious illness or even asthma, diabetes and other conditions,” Neuman said.

Experts say thorough research is the best way for retirees to estimate the costs they could incur under their current plans or switching insurance.

Individuals can use Medicare.gov to compare plans or contact Medicare by phone at 1-800-MEDICARE.

According to Ramsey, there are also State Health Insurance Assistance Program (SHIP) programs in every state that provide free, detailed and unbiased advice.

Start now if possible, Ramsey said.

This additional time will allow you to assemble your Medicare.gov login and prescription drug lists and have enough time to review plan comparison information and ask follow-up questions, he said.

Importantly, coverage changes don't have to be rushed, Moeller said, and you should give yourself plenty of time to consider your coverage options.

“There is no reason to make a hasty judgment,” Moeller said. “Even if you wait until December 7th to set coverage for 2025, it will take effect on January 1st next year.”