Tips for Medicare's Tricky Open Enrollment Season

In the midst of the government shutdown and the launch of the Affordable Care Act (aka Obamacare) health exchanges, Medicare’s open enrollment season begins Tuesday October 15. That’s when the nation’s 50 million Medicare beneficiaries who are 65 or older can choose, switch, add or drop their 2014 health and prescription plan coverage. The open enrollment period is scheduled to end December 7.
 
Making the right choices might save you, or your parents, hundreds or thousands of dollars.
 
Why Open Enrollment Is Even More Confusing Now
 
Trouble is, open enrollment is always a baffling process. Compounded this year by the shutdown and Obamacare, “it’s definitely more confusing than normal,” says Diane Omdahl, founder and president of 65 Incorporated, a firm that provides Medicare advice and information.
 
A recent survey by Medicare prescription drug plan provider Express Scripts found that 86 percent of Americans who are in Medicare plans or will be Medicare-eligible in the next 12 months were confused about how healthcare reform will affect their Medicare prescription drug coverage.
 
(MORE: 4 Mistakes to Avoid When Enrolling in Medicare)
 
Problems With a Key Website
 
The shutdown is causing particular havoc for open enrollment because the Medicare Plan Finder, the government’s online guide to help beneficiaries select the right plans for them, “may not be up to date,” according to the site.
 
Under normal circumstances, Omdahl would be encouraging Medicare beneficiaries to start reviewing their options right now. “However, until the shutdown is over and the government is back up to speed, it might be best to postpone making any decisions,” she says.  (If the government shutdown lasts for a while, there’s a chance open enrollment will be extended past Dec. 7.)
 
Still, it’s not too early to learn the basic do’s and — more importantly — don’ts to reduce this year’s confusion. I hope the following information and advice will help.
 
Medicare Enrollment Scams
 
First off, let me address the Medicare enrollment scams.
 
Some people over 65 have received fraudulent phone calls saying that, due to Obamacare, they’ll lose Medicare coverage or won’t be able to get “the required Affordable Act insurance card” unless they provided the caller with their Social Security number and other private information.

Others have gotten calls saying a new Medicare card has been mailed but they must reveal their checking account number so Medicare can deposit funds into that account, says Ross Blair, senior vice president of eHealth, whose eHealthMedicare.com and PlanPrescriber.com sites offer Medicare comparison tools and information.
 
(MORE: Turning 65? 7 Common Questions (And Answers!) About Medicare)

Here’s the truth: The government won’t call you about your health insurance or to verify your Social Security number or bank information. If you’re a Medicare beneficiary, you can’t sign up for insurance through an Obamacare exchange; the Affordable Health Care marketplaces are for people under 65 without health insurance. So if you get one of these calls, hang up.
 
Changes for Medicare Plans in 2014
 
Now to what’s new for Medicare plans:
 
For 2014, many Medicare Advantage plans — the federally subsidized private insurer alternative to traditional fee-for-service Medicare — have quietly boosted monthly premiums, trimmed benefits, boosted co-pays and deductibles and cut back on supplemental services. (Some plans are eliminating coverage for out-of-network specialists.)
 
Medicare beneficiaries can buy Advantage plans instead of purchasing Medicare supplement insurance (known as Medigap) and Medicare Part D prescription drug plans.
 
Premiums for Advantage plans are due to rise an average of 5 percent in 2014 to $32.60 a month, according to the Centers for Medicare and Medicaid Services.

(MORE: 5 Myths About Medicare Dispelled)

Meantime, some Medicare Part D prescription drug plans have jacked up premiums and the price you’ll pay for certain branded drugs. Although premiums are expected to increase 5.1 percent on average in 2013, according to Avalere Health, a consulting firm, half of the 10 most popular Part D plans will have double-digit increases.
 
Two pieces of good news regarding prescription drug costs: First, the infamous “doughnut hole” (the gap in coverage before a plan’s catastrophic coverage kicks in) will shrink by $80 next year. You’ll be in the hole for prescription drug costs between $2,850 and $4,450 in 2014; in 2013, the doughnut hole was $2,970 to $4,750. Second, the maximum Part D annual deductible will drop to $310 next year, from the current $325.
 
“If you have a lot of medication and out-of-pocket medical expenses, open enrollment is a critical period for you,” says Paula Muschler, operations manager for Allsup Medicare Advisor, which provides Medicare advice to consumers for a fee (typically $200 to $500).
 
Don’t automatically stick with the Medicare plan you have just to save the time and potential aggravation of shopping around. You could be costing yourself a bundle.
 
Muschler told me about one client who was reluctant to change her Medicare plan until she learned that one of her branded drugs would no longer be covered and she’d have to start paying the full retail price. She ended up switching plans and saving $7,000.
      
These are my do’s and don’ts for Medicare open enrollment. I’m starting with the don’ts because if you fail to follow advice about them, you could get into big trouble:
 
Medicare Enrollment “Don’ts"
 
Don’t take a call from someone you don’t know or trust offering to help you navigate Medicare plans. You should be the one initiating any queries.
 
Don’t give out any personal information, such as your Medicare number, to unsolicited callers. Remember: your Medicare number is the same as your Social Security number.
 
Don’t toss the mail you received from your health insurer and competing firms about your 2014 Medicare plan. You need to read this material to find out what’s in store for you and learn about potential alternatives.
 
Don’t assume that you (or your spouse) have the most appropriate Medicare plan. As a recent Marketwatch article noted, some married couples shouldn’t be on the same Medicare plan. Depending on the medications each of you take and the doctors you both need to visit, one Medicare plan may be better for one spouse than another.
 
Medicare Open Enrollment “Do’s"
 
Do review your current carrier’s Medicare plan for 2014 to ensure you understand the pending changes. Call your insurer with any questions. Then start researching alternatives on other insurers’ sites.      
 
Do understand that you may not necessarily be able to switch from your Medicare Advantage plan to a traditional Medicare plan plus a Medigap plan. Muschler notes that if you have health problems, you might not qualify for Medigap coverage or could be charged more for a Medigap policy than someone without them.
 
Obamacare’s ban against rejecting people due to pre-existing conditions generally does not apply to Medigap plans. In certain states, such as New York, however, “individuals have the guaranteed right to purchase the Medigap policy of their choice at any time,” says Muschler.
 
Do study any changes in your plan’s drug coverage and cost (Part D, if you have traditional Medicare). Check to see whether each medication you take now or may need next year will be affected. Then, compare this with other plans you could buy.
 
Do seek expert help if you need it. Start at your State Health Insurance Program or SHIP, which provides free one-on-one counseling and assistance to people with Medicare and their families.
 
There are also companies such as Allsup that offer Medicare consultations for a fee.
 
Do take your time, but be sure to make your choices before open enrollment ends. Although you shouldn’t procrastinate, you may want to wait until the government is back in business; that way, its website and Medicare officials can help you. Even if you wait until the last day of open enrollment, you can still change your Medicare plans for coverage beginning January 1, notes the 65 Incorporated site.