Missing the enrollment period or choosing the incorrect insurance plan can be a costly mistake when it comes to Medicare. It’s crucial to take the time to understand your options and make a well-informed decision.
As a licensed Medicare insurance agent, I am here to help answer your questions and provide guidance. My priority is to help Medicare-eligible individuals make informed choices about coverage. Over the years, I have seen common pitfalls seniors face when selecting a plan.
Here are some of the most common Medicare mistakes to avoid.
1. Failing to Sign Up for Medicare on Time
One of the most common mistakes people make is failing to sign up for Medicare on time. As you get closer to turning 65, you must enroll in Medicare during your Initial Enrollment Period (IEP).
This IEP is a seven-month period that begins three months before your birthday month and ends three months after your 65th birthday month. If you do not enroll during the IEP, you will face a penalty and may have to wait for the next General Enrollment Period to sign up for coverage.
The General Enrollment Period starts January 1st and ends March 31st. However, you should be aware that because you enrolled late, your monthly premiums may be higher, and you’ll pay a late penalty fee. That’s why it’s imperative to register during your IEP.
If you enroll during your IEP, General Enrollment Period, or another particular enrollment period, your healthcare coverage will begin the first of the month following your enrollment.
2. Not Taking Advantage of Supplemental Medicare Coverage
Original Medicare (Part A and Part B) is a great start to avoid medical bills, but it doesn’t cover everything, such as copays, coinsurance, and deductibles. To fill the gaps in coverage, you can add supplemental insurance plans like Medicare Part C (Medicare Advantage) or Medigap.
Part C is an alternative to Original Medicare that provides more comprehensive coverage and often includes vision, dental, and hearing care benefits that Original Medicare does not cover. On the other hand, Medigap is intended to supplement original Medicare with additional health coverage for things like hospital costs or doctor visits.
Understanding your healthcare needs and choosing the right supplemental insurance plan is essential. If you’re interested in buying a Medigap plan, doing this shopping simultaneously as enrolling in Original Medicare is recommended.
3. Ignoring Prescription Drug Costs
Prescription drug coverage is not included with Original Medicare (Parts A & B). To get prescription drug coverage, you must enroll in a stand-alone Part D prescription drug plan or have a Medicare Advantage Plan that includes Part D coverage.
If you need a particular prescription, it is best to ensure your plan covers it first. You can check this by reviewing your plan’s formulary. A formulary is a list of drugs that are covered by your Part D plan.
When selecting a plan, it’s important to understand the formulary list of drugs covered by each specific plan and compare monthly premium costs. Some plans may have higher premiums but offer lower copays for prescriptions. It’s best to weigh these factors carefully before making a selection.
It is also a good idea to see if your plan restricts coverage. For example, some plans require prior approval before covering a specific medication. Other restrictions may require you to try cheaper drugs first before the plan covers more expensive alternatives.
4. Not Reviewing Potential Changes to Your Coverage
Medicare plans change from year to year, so it is essential that you review your coverage each year and make sure the plan still meets your needs.
Even if you’re happy with a current plan, another one may offer better coverage or cost less. It’s important to compare plans annually to ensure you’re getting the most value for your money.
Review your plan’s annual notice of change (ANOC) and its evidence of coverage (EOC) for details about changes in benefits, copayments, and drug formularies. You can also contact Medicare or a licensed insurance agent to help you compare plans and get more information.
Knowing when and how you can change your current Medicare plan is essential. Generally, you can switch healthcare plans during the Open Enrollment Period, which runs from November 1st through January 15th each year.
5. Not Knowing Original Medicare vs. Medicare Advantage
Original Medicare is a national health insurance program administered by the federal government. It consists of two parts: Part A (hospital insurance) and Part B (medical insurance). Original Medicare is accepted at most hospitals, healthcare providers, and medical facilities that accept Medicare.
Medicare Advantage plans (Part C) are private health plans through which you can receive your Part A and Part B benefits. Medicare Advantage plans are run by private businesses that have contracts with the federal government. These plans may offer additional coverage, such as vision, dental, or hearing care.
It is essential to know the differences between Original Medicare and Medicare Advantage to choose a plan that meets your health needs. Be sure to review each type of plan and its associated benefits before deciding. Furthermore, it’s essential to understand how these plans work together with other supplemental insurance policies like Medigap.
6. Signing Up for Automatic Coverage Renewal
When you sign up for Medicare coverage, you may be asked to opt-in for automatic renewal. While this may seem like an easy option during initial enrollment, reviewing your coverage periodically throughout the year is essential.
Auto-renewal ensures that your plan remains active each year but does not guarantee that it is still your best choice. Therefore, reviewing all available options and comparing plans annually ensures you get the most value from your coverage.
You could be missing out on cheaper plans with better benefits if you were to opt-in for auto-renewal without reviewing other options.
Keep reading to learn six more common Medicare mistakes to avoid!
7. Delaying Enrollment When You Have Secondary Insurance
Even if you have job-based insurance, your employer may designate Medicare as the primary payer. In this case, you should sign up for Medicare when you turn 65 to avoid late enrollment penalties and to get access to additional coverage and benefits.
Additionally, if you have retiree healthcare coverage or COBRA, you’ll still need to enroll in Medicare to receive comprehensive coverage. This is because these types of coverage are considered secondary to Medicare.
Secondary insurance will only pay their portion after your Medicare portion is paid. Therefore, it’s essential to enroll in Medicare when you turn 65 or face a late enrollment penalty if you wait too long.
8. Failing to Check for Medicare Savings Programs
If you’re on a fixed income, you may qualify for certain Medicare Savings Programs (MSPs). These programs help low-income individuals pay their Medicare premiums, deductibles, and copayments.
Eligible individuals can get assistance with Part A, Part B, and more. In addition, there are four types of MSPs, all of which you can apply through your state.
Researching these programs and applying as soon as possible is vital so you don’t miss out on valuable savings. For example, research the income limits for each program and find out what documentation you need to include in your application.
9. Ignoring Potential Frauds & Scams
Common Medicare mistakes to avoid don’t just end when you enroll. Unfortunately, there are scams that target Medicare beneficiaries each year. These scammers may try to steal personal information or even divert benefits from legitimate recipients.
Protect yourself by never providing personal information to someone who contacts you out of the blue claiming to be from Medicare. Similarly, never sign up for any services in exchange for free medical equipment or supplies.
It’s important to stay vigilant and alert your local Medicare office if you suspect that someone is attempting to commit fraud or scam you. By taking these proactive steps, you can secure your benefits and protect yourself from scams.
10. Not Seeing if You Quality for Extra Help
If you have a limited income and resources, you may qualify for Extra Help. This federal program helps pay for some of the costs associated with Medicare prescription drug plans, such as premiums, deductibles, and copayments.
You can apply through Social Security or your state Medicaid office. Be sure to look into this program to see if you qualify to take advantage of the savings the program offers.
11. Choosing a Plan That Excludes Your Providers
When selecting a Medicare plan, ensuring your preferred providers are in-network is essential. Otherwise, you may pay more out of pocket for medical services and medications.
Take the time to research each plan you are considering and verify that all of your providers accept the plan. You should also read reviews from other beneficiaries to get a better idea of the coverage and services offered.
By doing your research and choosing wisely, you can ensure that you have access to all of the medical care and prescriptions you need at an affordable price.
12. Not Understanding Out-of-Pocket Costs
When it comes to common Medicare mistakes to avoid, there are certain out-of-pocket costs that you will be responsible for paying. This includes premiums, deductibles, and copayments for services and medications.
It’s essential to understand what these costs are before signing up for a plan so that you can factor them into your budget. You should also check to see if there are any additional costs associated with certain services or medications.
By learning about these out-of-pocket expenses before enrolling in a plan, you can make sure that you have the financial resources to cover them. Here is more information:
- Premiums: These are the fixed monthly payments you make to your insurance company for Medicare coverage. Your premium cost will depend on your chosen plan and any additional benefits you opt for.
- Deductibles: The deductible is the money you must pay before your insurance begins covering medical costs. Depending on your plan, this amount can vary.
- Copayments: Copayments are the set amount you must pay per medical service or medication. It’s essential to be aware of these costs before enrolling in a plan so you don’t get stuck with an unexpected bill.
- Coinsurance: Coinsurance is a type of cost-sharing in which you are responsible for paying a certain percentage of the total bill. This amount can vary depending on your plan.
By understanding these out-of-pocket costs associated with Medicare, you can make sure you’re aware of any potential expenses that may come your way. In addition, by knowing these common Medicare mistakes to avoid, you can ensure you get the most out of your coverage and save money.
Get Medicare Help With Senior Insurance Solutions
With the correct information and planning, you can ensure you get the care you need while still sticking to your budget. At Senior Insurance Solutions, I am a Medicare expert who can help you understand your coverage. I hope this list of common Medicare mistakes to avoid has helped. We’ll work together to make the best decisions for your health and financial needs. Contact me today to get started!
