Medicare Open Enrollment Starts Next Month

Medicare Open Enrollment is only one month away. Here are three important things all retirees should know as they prepare for this crucial period. It’s an important time of year for anyone on Medicare.

If you’re retired and old enough to sign up for Medicare, you may be planning to do so during fall open enrollment. However, you should know that open enrollment is for existing Medicare participants only. Your initial window to sign up for Medicare spans seven months, starting three months before the month of your 65th birthday and ending three months after that month.

If you missed that initial window and don’t qualify for a special enrollment period, you may need to wait until Medicare’s general enrollment period, which takes place from Jan. 1 through March 31 each year. Even if you are satisfied with your current Medicare plan, it pays to review your options during open enrollment.

Healthcare needs can change over time, and there may be a more cost-effective plan available. It’s wise to compare different Part D plan premiums and copays to potentially save money. Reviewing your plan annually ensures you have the best possible coverage for your current situation.

Many seniors opt for Medicare Advantage over original Medicare because these plans often offer additional benefits, such as dental care, eye exams, and hearing aids, which original Medicare does not cover. Some Medicare Advantage plans also provide benefits like fitness club memberships and meal delivery services. However, if you’re not using these supplemental benefits, reassess your plan.

You might find a different Medicare Advantage plan that offers the basic benefits you need at a lower cost, or one that provides the specialized benefits missing in your current plan. Start your research early to avoid feeling overwhelmed and to allow plenty of time for comparison. Taking the time to review and adjust your Medicare plan during the open enrollment period can lead to significant savings and better coverage suited to your needs.

The Centers for Medicare & Medicaid Services (CMS) is preparing significant changes to Medicare in 2025. These changes will impact Medicare Part A, B, C, and D, though details for Parts A, B, and C are still forthcoming. In 2025, several rules from the 2022 Inflation Reduction Act will take effect, potentially lowering medication costs significantly for Medicare participants.

Part A helps cover inpatient care in hospitals, critical access hospitals, and skilled nursing facilities. Nearly 99% of Medicare beneficiaries receive Part A for free, having already paid Medicare taxes during their employment. The CMS typically announces updates to Part A in October, so more information for 2025 is expected soon.

Part B covers medical services, including doctors’ services and outpatient care. Part B is optional, with the 2024 premium set at $174.70 per month. Updates for Part B in 2025 are usually announced in the fall.

Medicare Advantage plans, or Part C, offer additional coverage such as vision, hearing, dental, and wellness programs, often provided by private companies. In 2025, a new mid-year notification for Part C enrollees will highlight any unused benefits, helping participants make more informed decisions during reenrollment. Part D helps cover the cost of prescription drugs, and several changes are expected in 2025:

The base Part D beneficiary premium will increase by $2.08, a 6% rise from $34.70 to $36.78.

Medicare enrollment preparation essentials

However, actual premiums may vary. There will be a $2,000 annual out-of-pocket maximum for medications, which is expected to benefit enrollees with expensive prescriptions.

This cap does not apply to medications covered under Medicare Part B. The Coverage Gap, or “donut hole,” will be removed in 2025. Participants will pay their deductible (up to $590) and then copayments until reaching the new $2,000 maximum, simplifying the payment structure.

A new payment plan will enable enrollees to spread medication costs throughout the year rather than paying all at once. This opt-in plan will allow monthly payments up to a certain amount. As CMS unveils more details, we will continue to provide updates on these impending changes to ensure Medicare participants are well-informed and can plan accordingly.

With the approach of the Open Enrollment Period for Medicare, one of the most crucial letters recipients will receive this year is the Annual Notice of Changes (ANOC). This essential document, arriving by September 30, details modifications to Part D drug coverage for the upcoming year. The ANOC provides an overview of updates in your plan, helping you navigate the Open Enrollment Period, which runs from October 15 to December 7.

During this time, you can ensure that you have the most suitable plan for 2025. It’s imperative to review these changes carefully to avoid unexpected costs or coverage issues starting January. Some key sections to examine in the ANOC include:

Summary of Costs (Page 4): Outlines changes in premiums and drug tier cost-sharing for 2025.

Plan Availability (Page 6): Indicates if your current plan will be offered next year. If not, you may be automatically enrolled in a different plan, often with a higher premium. Pharmacy Network Changes (Page 7): Details shifts in the pharmacy network, requiring you to verify if your preferred pharmacies are still included.

Prescription Drug Coverage (Page 8): Lists covered drugs, any tier changes, or new restrictions such as prior authorization or step therapy requirements. The elimination of the 5% Catastrophic Coverage coinsurance is a significant change, as it brings Part D enrollees closer to the new $2,000 out-of-pocket cap. Although this cap will benefit many, it could also prompt plans to adjust cost-sharing measures, potentially raising out-of-pocket expenses.

To effectively prepare for Open Enrollment and determine the best plan for 2025, consider the following questions:

Are all your medications covered under the new plan? What will your out-of-pocket costs be for these drugs? Has there been any change to your preferred pharmacy network?

Are there new restrictions on your medications? Is your premium increasing? If, after reviewing these factors, you find that your current plan remains the best option, no action is needed—the plan will renew automatically.

However, if another plan seems more advantageous, enroll in it before December 7 to avoid last-minute complications. With numerous changes expected, this year’s Open Enrollment Period is more critical than ever. The Annual Notice of Changes is your roadmap to identifying the best drug coverage for 2025, and the Medicare Plan Finder tool will assist in evaluating your options.

Don’t miss this opportunity to secure the optimal plan for your needs.