Nobody plans to get sick or hurt, but whether we like it or not, we will all need medical attention at some point, especially as we get older. A good health insurance policy like Medicare covers the costs of these medical treatments and provides us with several other benefits.
However, no health insurance policy covers everything we might need. There will always be gaps that can hurt our pockets, especially if we need to pay them upfront. So, if you are shopping for a new Medicare plan this fall, you must consider many different factors to make the right choice.
1. Existing Options
Medicare beneficiaries often stick with their existing coverage during Medicare’s fall open enrollment period, although professionals recommend that they shop around and weigh their options. According to a Kaiser Family Foundation study, less than 30% of Medicare beneficiaries compared medical plans during the 2018 open enrollment period.
Experts warn that not exploring your options could lead to significant financial losses. According to a 2017 survey of over 30,000 people, only 10% had the Medicare prescription drug coverage plan that covered their prescription drugs at a minimal cost. Over the following year, they could have saved an average of $541 by switching plans.
2. Doctor and Hospital Choice
It’s not a guarantee that your doctor will be able to participate in your plan next year since provider networks change frequently. Ensure your policy covers your doctor to avoid out-of-pocket costs when you see them the following year. Additionally, you should check if your preferred hospitals are available in your provider’s network.
Plans must give beneficiaries 30 days’ notice when a doctor’s contract ends mid-year. Furthermore, insurers must help you find a new doctor who participates. Plans must send notices to their members about the Medicare changes for the next year as Medicare’s open enrollment approaches, so you must read those notices carefully.
3. What’s Beyond the Cost
In the long run, a low-cost plan may end up being more expensive. For a sense of your total spending for the year, pay close attention to a plan’s copays, coinsurance, deductibles, and changes in drug coverage and benefits. A Kaiser Family Foundation study found that in 2021, Medicare Advantage enrollees’ out-of-pocket limit averaged $5,091 for in-network services and $9,208 for out-of-network services.
Many believe that if their current plan raises drug prices or premiums or reduces benefits, all other policies will do the same. But this isn’t always the case. Costs vary among Medicare plans, and increases can be isolated to specific policies.
4. Coverage
There are different Medicare plans offering various benefits. Each has its pros and cons, and you have to be aware of these to ensure that the one you purchase will meet your needs.
Here are the different Medicare policies and their coverage:
Original Medicare (Part A & Part B)
Original Medicare consists of parts A and B, which are hospital and medical insurance, respectively. You do not need to buy Original Medicare from a private carrier since it is a federal program that has the same rules for everyone. However, note that drugs, dental, vision, and hearing care are not generally covered in Original Medicare, thus you might be interested in shopping for additional private options.
Medicare Advantage
Private insurance companies that Medicare approves offer Medicare Advantage plans, known as Part C. This plan includes all the benefits provided by Original Medicare Parts A and B (except hospice care).
The majority of Medicare Advantage plans cover prescription drugs, as well as routine dental, vision, and hearing care. Many of these plans also offer wellness programs, including free gym memberships. These features also make it popular among Medicare shoppers.
Medicare Advantage plans are subject to a monthly premium, although many are affordable or even free. Choosing Medicare Advantage still requires you to pay the $164.90 or higher Part B premium each month, depending on your income.
To avoid additional out-of-pocket expenses, you should also use health care providers and facilities included in your plan’s network.
Part D – Prescription drug plans (PDP)
Private insurers offer stand-alone prescription drug plans with varying premiums, deductibles, and copays. The formularies of each plan specify what drugs are covered, so make sure you confirm that your medications are covered. Additionally, if you use pharmacies in the plan’s network, you will generally save money.
5. STARS Rating System
As part of Medicare’s quality rating system, called Medicare STARS, Medicare Advantage and Medicare Part D plans are rated from one to five stars. Generally, five stars are the highest rating a plan can receive, and one is the lowest rating.
The STAR Rating system considers factors like:
- Complaints from members, including how often problems occurred
- Customer service and support
- Vaccinations, screening tests, and other preventive measures provided to members
- Members who received help managing chronic conditions
- Part D drug pricing accuracy and drug safety