The Medicare open enrollment period runs from October 15 through December 7. According to the U.S. Centers for Medicare & Medicaid Services (CMS), more than 65 million Americans are enrolled in Medicare programs.
The open enrollment period allows individuals to review and change their health plans. However, navigating through different Medicare plans to find which one is right for you can be a tricky, and overwhelming, task.
Medicare is a federal government health insurance program for those over 65 years old, younger people with certain disabilities, and individuals with end-stage Renal Disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD).
Medicare’s different parts
Medicare is provided by CMS and contains two parts, Part A (hospital insurance) and Part B (medical Insurance). Part A covers necessary hospital and skilled nursing facilities, plus home health and hospice care. Part B provides coverage for doctor's services, preventive services, durable medical equipment (DME), hospital outpatient services, lab tests and x-rays, mental health care, and specific home health and ambulance services.
These two parts are eligible to all United States residents as standard plans without differentiation. Medicare Advantage, also known as "Part C," is a private insurer version of the Original Medicare (Parts A, Part B). Part D is a private insurance plan for prescription drug coverage that original Medicare recipients can receive. Many Medicare Advantage plans include Part D.
OpenMedicare is a resource that assists Medicare-eligible Americans in weighing the different Medicare options. CEO Anthony Kavarous says Medicare Advantage plans are becoming increasingly popular due to Part D coverage inclusion. Still, Kavarous notes Original Medicare contains many benefits over Medicare Advantage plans.
"Original Medicare has some significant advantages over Medicare Advantage, such as the ability to see any doctor, specialist, or health professional who accepts Medicare nationwide with no referral requirements. However, it also has a major downside: it only covers 80% of the Medicare-approved cost of services after you meet your annual deductible. The remaining 20% — in the form of deductibles, coinsurance, and copayments — remains your responsibility, which could be financially devastating in the case of a severe illness or injury since it has no upper limit."– Kavarous
Medicare supplement insurance
Medicare supplements, or Medigap policies, are optional private insurance plans to help fill any holes not covered by Original Medicare. There are 10 different forms of Medigap plans that are offered in most states, options are named by letters: A-D, F, G, and K-N. Price is the solo difference between plans with the same letter sold by different companies, the CMS states. You can not have a Medigap policy and Medicare Advantage plan.
"Whereas Original Medicare is the foundational insurance for state Medicare beneficiaries administered by the government to cover hospital care, doctor’s visits, and other medical expenses, it’s not a blanket policy that covers everything," Kavarous said. "You will have deductibles, coinsurance fees, and copayments to pay. Medigap is optional insurance offered by Medicare-approved private insurance companies to fill part or all of the costs left unpaid by Original Medicare coverage."
Kavarous says Medigap policies aim to reduce potential surprises from health care costs during retirement. He notes there are some benefits for Medigap coverage. With Medigap Plan G — except for the $226 annual Part B deductible — 100% of your out-of-pocket costs are covered.
"Plan G is ideal for someone who prefers the certainty of budgeting for an extra monthly premium but wants to know that there will never be another medical bill as long as they only choose providers who agree to work with Medicare," Karavous said. "They’ll never have a financial reason to hesitate to visit a specialist or a specialized facility. And, for international travelers, some emergency help is available."
A complete list of Medigap policies and their benefits are available on the CMS website.
Medicare enrollment process
The Social Security Administration administers Medicare, despite the CMS being in charge of it. Individuals who are already receiving Social Security benefits prior to the age of 65 are automatically enrolled in Original Medicare. A "Welcome to Medicare" packet that includes your Medicare card will arrive three months before you turn 65.
The Initial Enrollment Period (IEP) is the first opportunity for those eligible to sign up for Medicare. This period begins three months before you turn 65, and lasts three months after your birth month.
"For example, if your birthday falls in June, your IEP starts on March 1 and ends on September 30. However, if your birthday is on the first of the month, it shifts eligibility earlier," Karavous said. "If your birthday falls on July 1, your IEP starts on March 1 and ends on September 31."
The day your coverage becomes active depends on when you enroll. If you sign up for Medicare the month before you turn 65, your coverage will start on your birth month. If you apply on your birthday or the next three months, coverage starts the month after you apply.
If you are 65 with no insurance and have not been receiving retirement or disability benefits from Social Security or the Railroad Retirement Board for at least four months, you must apply for Medicare yourself.
How to sign up for Medicare:
- Online at the Social Security website
- Call Social Security at (800) 772-1213, or call (800) 325-0778 if you’re a TTY user
- Contact your local Social Security office
- Call the Railroad Retirement Board at (877) 772-5772 if you or your spouse worked for a railroad
Applying for Medigap Policies
The CMS says under federal law, individuals receive a six-month "Medigap Open Enrollment" period that starts the first month they have Medicare Part B, and are over 65. During that six-month period, you may enroll in any Medigap police. After that period, you may not be able to purchase a Medigap policy or find a plan more expensive.
You may purchase a Medigap policy from an insurance company that is licensed in your state. The CMS recommends contacting your local State Health Insurance Assistance Program (SHIP) to receive free assistance in choosing an insurance policy.