Medicare open enrollment for 2010 begins on November 15th and lasts through December 31st. This is a period of time that occurs each year and allows Medicare beneficiaries to make changes to their existing coverages. There is some confusion about this window of time and what changes can be made. Please read on to learn more about what you can expect during what the CMS (Centers for Medicare and Medicaid Services) refers to as the Annual Election Period or AEP for short.
The most common change made during open enrollment is switching Part D rx plans. Assuming your drug coverage is not tied to a Medicare Advantage plan that you will be keeping, you can use this month and a half window to shop for new drug coverage.
Prescription coverage is mostly provided by private insurance carriers and their rates and plan designs will change year over year. By shopping around, you might be able to reduce your premiums and cost sharing by purchasing a new plan.
It is important to note that CMS uses a standard model that all Part D carriers must abide by. This means that premiums can vary, but the coverage itself will be somewhat similar from carrier to carrier. However, some drug formularies and/or plan exclusions are more forgiving with certain companies.
AEP is also the time of year when you can opt out of your Medicare Advantage plan and purchase a different Advantage plans or return to Original Medicare. If premiums have increased, cost sharing has gone up, or you are unsatisfied with any network limitations – then this is the time to explore your options.
If you have been enrolled in a MA plan for over a year and decide to return to Original Medicare and also purchase a Medicare supplement (Medigap) Plan, then there can be some limitations. (See Below)
This is where there seems to be the most confusion. During the AEP, you cannot automatically purchase a Medicare supplement without underwriting unless you meet certain criteria. If you are dis-enrolling from a Medicare Advantage plan after only one year, then you are guaranteed issue for supplemental coverage.
In this way, the rules allow you a one year trial period with an Advantage plan and if you are not satisfied, then you can return to Original Medicare and purchase Medigap coverage as well as a stand alone prescription Part D plan.
If you want to switch from one Medicare supplement to another in order to reduce your premiums, then you will need to be underwritten in most cases. This means that the insurance companies can turn you down if you are in poor health.
Underwriting for most supplemental coverage is not terribly strict, thus you still may qualify for a new plan even if your health is less than perfect. In fact, some companies require very little underwriting at all. While your premiums may be higher for such plans, you will still be able to enroll and reduce your out of pocket health care expenses.
There are a couple of exceptions to the CMS rules and they will differ by state. There are a few states, California and Missouri for example, that allow you to change supplements each year without underwriting. You cannot automatically purchase better coverage, but you can select a like plan – Plan F for Plan F would be an example.
It is important to note, that these changes are not necessarily made between Nov. 15th and Dec 31st, but rather on your birthday in California and on your anniversary (date policy became effective) in Missouri. Most states, however, have no such rules.
If you are purchasing new Part D drug coverage, dis-enrolling from a Medicare Advantage Plan and/or purchasing a Medicare supplement plan within the one year grace period, or enrolling in a new Medicare Advantage plan – then all changes will be effective as of January 1, 2010.
Again, the exception to this rule would be if you are simply switching Medicare supplements. This can be done throughout the year as long as you are healthy enough to be underwritten for a new plan. This means that you do not need to wait until November 15th each year if you want to shop for new Medigap coverage.
In summary, AEP can be somewhat confusing if you are not sure of the rules and your rights. It is advantageous to speak with a knowledgeable agent in order to discuss your options, but to also make sure that you are operating within the CMS guidelines. When approached properly, making changes to your coverage can be a seamless and stress free situation for Medicare beneficiaries.
Category: Medicare Supplements