Why You Should Review Your Medicare Plan Every Year
- Original Medicare and Medicare Advantage coverage options can change every year. This guide outlines how you can review your plan to make sure your needs are met and how to look for a new plan if you need better coverage or lower costs.
People don’t agree on much these days, but they do seem to agree on this: They are very happy with their Medicare coverage.
According to a 2019 Insurance.com survey of 1,000 people who were asked to rate their satisfaction with their Original Medicare coverage (Medicare Part A and Part B) from 1 to 5:1
- 43% rated their Original Medicare health insurance a 5 rating
- 39% gave their Original Medicare plan a 4 rating
- 0% gave Original Medicare a 1 rating
Likewise, a 2020 study of 1,200 Medicare Advantage (Medicare Part C) enrollees found:2
- 98% were satisfied with Medicare Advantage coverage
- 97% were happy with their provider networks
- 98% were satisfied with the handling of the Covid-19 health crisis
That’s certainly good news. But it doesn’t mean you should take your coverage for granted.
Review Your Medicare Coverage, Even If You’re Satisfied With Your Plan
Every year, things change. The Centers for Medicare and Medicaid Services (CMS) list these three things you should consider each year:
- Your health care needs may change. You may need to see a doctor more or less often. You may need different prescription drugs or new health care services.
- Plan coverage can change. Plans often change their benefits packages, and not all Medicare plans offer the same benefits. You may find a new plan in your area that offers coverage better suited to your needs than your current plan.
- New, more affordable Medicare plans may become available. The costs, provider networks and services offered are different between plans.
That is why it’s important to review your plan every year to see if it still meets your needs or if there are other Medicare plan options that offer better coverage or lower out-of-pocket costs.
Prepare for Open Enrollment
The typical time to change Medicare plans is during the fall Medicare Open Enrollment Period, which runs from October 15 to December 7 every year.
During Open Enrollment (also called the Annual Election Period, or AEP), you can:
- Switch from Original Medicare to Medicare Advantage, or vice versa
- Change from one Medicare Advantage plan to another
- Add or change Medicare Part D prescription drug coverage
Before Open Enrollment, you will receive notices from your plan about changes for next year in the “Annual Notice of Change (ANOC)” letter. Review that information carefully and make note of any changes in costs or benefits for the coming year. If you have other types of health or prescription drug coverage, understand how it will work with Medicare to cover your costs.
What Changes Most Often?
Perhaps the most important changes to watch out for each year with your Medicare plan include:
- Provider network updates
- Prescription drug coverage changes
Your plan provider network is the list of doctors, hospitals, pharmacies and other healthcare providers that the plan accepts. Every year, check to be sure your favorite doctors and hospitals are still in your plan network. If they are not, you may have to pay more to use them, or you may be required to switch to a new provider for full coverage.
Prescription drug coverage is where important changes are most likely to occur. Every year, Medicare Prescription Drug plans and Medicare Advantage drug plans can make changes to their formulary, which is the list of drugs they will cover and how much they will cost you, based on their price tiers.
Additionally, new plans may become available in your area that have a better formulary and tier structure for your medications. Either of these factors can have a significant impact on your drug coverage and costs.
And finally, your plan may change which pharmacies they work with to offer the best pricing. Your favorite pharmacy may be removed from the network, meaning you will have to change pharmacies or pay more out of your own pocket.
What to Do Next
If you like your current Medicare coverage and it’s still available for the coming year, you don’t need to do anything. You will be automatically renewed in the plan as long as you continue to pay the required premiums.
If you are considering a change, you may want to consider working with a licensed insurance agent who can help you compare multiples plans from a number of different insurance companies that offer plans where you live.
Masterson, Les. (Oct. 18, 2019). Original Medicare tops ratings in survey, beating out Medicare Advantage and employer plans. https://www.insurance.com/health-insurance/health-insurance-plan-ratings.
Lagasse, Jeff. (Jan. 22, 2021). Seniors show high level of satisfaction with Medicare Advantage during pandemic. https://www.healthcarefinancenews.com/news/seniors-show-high-level-satisfaction-medicare-advantage-during-covid-19-pandemic.