It’s the
second most wonderful time of the year (the first being when the kids return to
school): Medicare Open Enrollment Period. This is the time of year when
all Medicare beneficiaries make the critical decision as to whether or not to
renew or change their coverage. The reason why this timeframe is so
critical is because Medicare Advantage and Prescription Drug rates and coverage
change annually and it is wise to review and perhaps take advantage of those
changes. This year the open enrollment period is from October 15, 2019 to
December 7, 2019. Any changes made during the open enrollment period will take
effect on January 1, 2020.
Medicare
Advantage Plans and Medicare Supplements
The first
critical choice is whether or not to enroll in a Medicare Advantage Plan or a
Medicare Supplement Plan. With Traditional Medicare, Parts A and B, Part A
covers hospitalizations and Part B covers medical visits. Part B has a
projected monthly cost for most enrollees of $144.30 in 2020; for individuals
with high income, the premiums will be much higher. It is a requirement to
first be enrolled in Parts A and B in order to enroll for Medicare Advantage
and Medicare Supplement Plans. With Medicare Supplements, you can go to any
doctor or hospital that takes Medicare, anywhere in the U.S. With Medicare
Advantage, in most cases, you’ll need to use doctors who are in the plan’s
network. Medicare Advantage Plans, which are sold by private insurers,
offer additional benefits, including, but not limited to, prescription drug
benefits, dental and vision services.
Starting
in 2020, some Medicare Advantage Plans will offer additional benefits, such as
home care, in-home safety services and rides to medical office visits.
These are services which have never been offered by these plans. This is why it
is more critical than ever to take a look at the individual policies and
determine which one is right for each individual situation.
Closing
the Part D Donut Hole
In 2020,
that gap where Medicare beneficiaries are responsible to pay for most of their
Prescription Drug costs, known as the “donut hole,” will close and no longer
exist. However, members will pay 25% of the drug costs and there will be an
out-of-pocket limit for all medications, called the catastrophic threshold
(2020 amount $6,350), that, once met, the Medicare beneficiary will be
responsible to pay only a 5% co-pay. A Medicare Advantage Plan may assist with
the required co-pays.
Although
there is no requirement that enrollees sign up for Medicare each year, with all
of the changes, it is advisable to review your Medicare health and prescription
drug coverage and make changes if your coverage no longer meets your needs or
if you could reduce your out-of-pocket expenses.
In
September, the "Plan Annual Notice of Change" (ANOC) was mailed out
to all beneficiaries of Medicare coverage. This notice indicates any
changes affecting your plan coverage and should be carefully reviewed.
This Alert
was co-authored by Michael LaMagna, Partner of Riker Danzig (mlamagna@riker.com, 914.539.3365) and
Michael Coogan of PGM Group (mcoogan@pgmgroup.com,
914.220.8333).
