We are now approaching the beginning of the open enrollment period for Medicare. The enrollment period runs from October 15 to December 7. This is the time period where we can finalize our plans, adjust our coverage if necessary, and commit to the coverage, and type of coverage, that we will receive for the following year.
These decisions can have a huge impact on your treatment and expenses for the year, so it is especially important to choose the right coverage while you have the option.
I know that insurance in the US is already a scary and overwhelming thing, so I’ll do my best to give you the information you need to make the best possible decision for yourself.
After open enrollment for the year ends, it can be more challenging to select or change your plan.
For people who join later in the year, they will have the same range of options, but the details on each program may be more limited in availability or it may take more searching to get the needed details.
What is the CMS?
Medicare is one the programs governed by the Centers for Medicare and Medicaid Services(CMS), the single largest healthcare provider in the US. It was created in 1965 to administer healthcare services to Social Security recipients(Medicare) and people receiving cash social welfare benefits(Medicaid).
Since then, the program has evolved to cover considerably more people. Medicare has expanded to not only cover people over 65 but also cover people with disabilities and End Stage Renal Failure.
With the Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA), both Medicare part D and the Medicare Advantage Programs were added to Original Medicare. While adding options, this also has made Medicare plan selection much more complex and potentially confusing.
Medicaid has been expanded, too, covering low-income families, pregnant women, disabled people of all ages, and people who need long-term care.
In 1997, the CHIP program was created, specifically designed to provide healthcare coverage to otherwise uninsured children.
The newest addition to CMS is the Healthcare Marketplace, which was added to their purview with the Affordable Care Act. While much of the Marketplace is private insurance, the Marketplace itself is administered by the CMS and utilized to test new options for healthcare delivery and payment.
How do I get Medicare?
There are two main ways to get Medicare: one is to age into it(anybody eligible for Social Security Retirement Benefits is automatically eligible for Medicare), and the other is to get it through getting on Social Security Disability Insurance benefits.
Getting onto Medicare takes a lot of time. It can take years to be awarded SSDI, and Medicare doesn’t start until 24 months after onset of disability(which may or may not have passed while you were waiting for coverage).
Notice that I say eligible. If you are Medicare-eligible, you still need to select your plan(s) and pay for them.
Once you receive your Medicare card, it will list your date of eligibility for Medicare coverage. If you age into Medicare, that date should be the month and year of your 65th birthday.
If you become eligible through SSDI, that date will be 24 months after the determined onset of disability date. You should receive your Medicare card with your SSDI eligibility letter, even if you won’t be eligible for months or even a year or so.
It is possible to refuse portions of your Medicare coverage(for example, if you are still employed and have coverage through your job, it may be to your advantage to delay using Medicare until that is no longer the case), but generally, it’s one of the better insurance opportunities and one of the more cost-effective.
If you decide not to use parts of your Medicare, please be sure to understand the rules around reinstating that part in the future(it may only be an option during open enrollment, for example)
Medicare is not a single program, instead, it is a collection of coverage options, split into parts, and you have the option of accepting(or rejecting) each part individually.
Again, my recommendation is to use the entire plan, but if you currently have reliable additional coverage at a better price point, I can understand putting off paying for coverage you don’t need.
Original Medicare is parts A(hospital), and B(medical professionals). Medicare part D(Medication) was added in 2003 and complements parts A and B.
Medicare Part A usually doesn’t have a premium, and it covers hospital usage and associated expenses.
Medicare Part B covers doctors, physical therapy, testing, and other associated medical services.
You should be billed monthly – it can be taken out of your social security check every month before you get it, or you can elect to mail it in every month.
For 2021, part B’s premium is $148.50 for most people, and for most years there is a slight increase.
Part D is what you use at the pharmacy to get your medications. Generally, your part D plan runs around $15-100/month, though if you really search, you may find a more expensive or cheaper plan.
The drug plans are generally not run by the insurance companies you may be used to hearing about. I’ve used AARP, Wellcare, Silverscript, and others, to give you examples.
Medicare Advantage is also referred to as ‘Medicare part C’. If you use it, it replaces your Part B and Part D coverage.
I personally recommend against this option as it can be much more limiting than Original Medicare coverage.
Selecting your plans – choosing your Part D
This all may sound a bit confusing. The good news is, once you’ve made your basic decisions, the only thing that you are likely to need to change annually is your part D coverage.
If you are using part B, you have access to one of the largest network of covered doctors(who isn’t going to accept the insurance that covers most people over 65?), and there are no more details to worry about.
Part D, the medication coverage, is where things get more complicated.
There are a large number of part D providers, and every year, they adjust aspects of the plan.
Each one has a set of formularies(medications they prefer you use, and how much they cost), which are adjusted annually, and all the medications are in different ‘tiers’ of expense.
Basically, tiers 1 and 2 cover generics, 2 and 3 cover simple brand-name stuff, and the higher tiers get more expensive, provide less coverage, and are more likely to include a coinsurance payment, rather than a copay.
My antidepressants are older generics so tend to be on tier one, but when I was prescribed an inhaler to help manage bronchitis, that was tier 4.
Newer migraine treatments are higher-tier items(if they are covered at all), though the much older ones may be lower tiers.
Each part D plan will move some medications around, sometimes between tiers and often remove or add medications to their formularies, so even if you are taking the same medications every year, the costs with the same provider may vary.
Once you have set up your Medicare plan to your liking, this should be the only thing you need to think about each year during open enrollment.
The good news is, there is help.
Help selecting your part D plan
The easiest method is to enter all the medications you take into your medicare.com account(if you don’t have one, go to their site and set one up), and once the new formularies and such are out(which should occur in October), search for the plan that makes your medication mix most affordable.
Usually, they’ll show you some of the best options and you can compare them to determine what makes the most sense for you.
I’m actually offering a tutorial/walkthrough on November 14th at noon, where you can join me as I select my plan and share my thoughts along the way. I’ll be happy to answer your questions as you join me for the whole process, step by step.
There are also the State Health Insurance Assistance Plan(SHIPs) programs. This is a free service for all Medicare users.
Another resource for SHIP information is https://www.seniorsresourceguide.com/directories/National/SHIP/
Through these sites you can find people who are familiar with the options and able to help talk you through making the best decision for you. My suggestion is if you are going to use SHIP, try to reach out and schedule an appointment sooner than later.
Extra Help and dual-eligibility
In some cases, you may be eligible for additional support.
If your income is low enough, you may actually be dual-eligible, covered by both Medicare and Medicaid. If you are, Medicaid pays all of your Medicare charges. You won’t pay for part B or part D, and if you see doctors who also accept any form of Medicaid in your state, your visits will be either free or have minimal costs.
There are also Medicare Advantage Plans specifically for people who are dual-eligible. Again, I recommend not taking that option, unless there’s a very specific feature you find worth the risk.
Some doctors also may just not ask you for that residual bill, knowing that you are dual-eligible. There will be a similar effect with your medication – if it’s covered by Medicaid, it’s free, and if it isn’t, the costs are minimal.
Also, some states have employment-related programs that can make you dual-eligible as long as you are working. It’s definitely worth looking into if you are considering working in any capacity. An example of this is the program in New Jersey, workability. I used that program for years myself.
Being dual-eligible leaves you automatically eligible for Extra Help(yep that’s the name of the program, creative right?), which also helps defray the costs of your medications.
Between Extra Help and Medicaid, while I was dual-eligible due to workability, I probably paid no more than a few dollars a month for my medications. I am minimally medicated and mainly take generics, but it still was a really nice feeling to pay so little at the pharmacy every month.
I hope that this helps defray some of the mystery and stress around Medicare and Medicare coverage.
Medicare eligibility is based on your age or disability and eligibility for social security benefits. If you receive Medicare due to disability, the coverage begins 24 months after onset of disability, which while often passed during the waiting period for your disability determination, isn’t always.
Your medicare card will have your eligibility date printed on it, in the form of month and year.
Original Medicare has three parts to it, Parts A(hospital), B(medical/doctors), and D(medication).
Medicare Advantage programs(which I personally have found to be much less helpful than original Medicare) are labeled as Part C and usually replace all other options.
Once you have selected original Medicare, the only portion that changes annually is your part D coverage.
Every year each part D plan adjusts its formulary of drug costs and coverage. It’s in your best interest each year to double-check if you still have the best coverage given your medication mix and the likelihood of your prescriptions changing.
If you are uncomfortable checking the information yourself, SHIP provides people to help you choose your best options for part D coverage.
If you are or may be dual-eligible for Medicare and Medicaid(either based on low SSDI income or participation in a work-support program), that eligibility will reduce your medical expenses. Medicaid pays for your Medicare coverage and makes you automatically eligible for an Extra Help program that also reduces your medication costs.
I hope this has put you more at ease about your Medicare coverage and usage and would love to hear any tips or tricks you have learned about Medicare!