October 8, 2022

Medicare Open Enrollment: A Timely Review


We are just a week away from the start of the annual Medicare enrollment period, a time when Medicare recipients can make changes to their coverage for a start date of January 1, 2023. Ending December 7th, this is the time each year when you are allowed to change from Medicare to a Medicare Advantage program, or back to traditional Medicare from an advantage plan. You can change from one supplemental policy or company to another, and change your Part D drug coverage. 

An important note: If you have a Medicare Advantage program you are given another period to switch to another Advantage plan, or back to the original Medicare. This do-over is called the Medicare Advantage Open Enrollment Period which occurs from January 1st to March 31st. 

In essence, you are allowed to change your decision during the standard open enrollment period or the Advantage open period Because there are some extra considerations beyond the scope of this post, I urge you to check for all the information about what you can and cannot do,.

Back to the original open enrollment period, does it pay to switch? Not always, but looking at options every year is a wise decision. Betty and I switched to a different Part D coverage plan two years ago, for example. The plan we had was set to impose a 100% rate increase...yep, double. Instead, we picked one that covers the drugs we take, at the pharmacy we use, for 50% less than the new monthly premium. Just by spending 20 minutes online, we saved nearly $1,000 in premium costs. For 2023 our plan is raising the monthly cost by 25%, but it is still our best option.

So, this post has a dual purpose: urge you to do some comparison shopping, and for those approaching Medicare age, a brief review of what can be a complicated system.
 I am covering Medicare, not Medicaid which is an entirely different animal. As with most federal programs and health insurance coverage, there are enough exemptions and differences to fill 20 posts. I will only attempt to explain the usual, most common situations.

Medicare is a federal program that pays for certain health-related expenses for people 65 and older (and younger in certain situations). While many costs are covered, an individual enrolled in Medicare is responsible for certain deductibles and copays. Some services are not covered at all and others are for only a limited period of time.

There are four parts of Medicare:

Part A is hospital insurance. Copays and deductibles will determine what you will pay. Usually, there is no premium for Part A.

Part B is medical insurance that helps pay for doctor visits, outpatient care, preventive health care, and equipment. There is a monthly premium for Part B. For 2023 the government is projecting a modest decrease in the monthly cost for most of us, after a significant increase in 2022.

Part C is better known as Medicare Advantage. This is coverage provided by Medicare-approved private insurance companies.

Part D is prescription drug coverage. This is also run by Medicare-approved private insurance companies.

Most folks get Part A and Part B automatically. If you receive benefits from Social Security you will automatically get Part A & B coverage starting the first day of the month you turn 65.  If you aren't yet receiving Social Security, because you are still working, or waiting until your full retirement age, there is something called the Initial Enrollment Period which is the period from 3 months before until 3 months after your 65th birthday. If you miss this window your benefits will be delayed.

If you decide to wait until after the Initial Enrollment Period, there is a general Enrollment Period during the first three months of each year. However, if you use this option, realize your part B premiums will be higher for the rest of your life.

If you are covered by a group health plan at your place of employment and then want to start Medicare, there is another time period, called the Special Enrollment Period that generally allows you to avoid the higher premiums for a late signup.

With me so far?

Other Factors to Consider

Medicare does not pay 100% of most services. The Affordable Care Act has put in place several free screening tests for those on Medicare, like colonoscopies and mammograms. Free vaccines for protection against several diseases and infections are also available.

Most doctor visits, tests, drugs, and equipment are going to cost you money...usually, something approaching 20% of the total, discounted rate. That's where Medigap or supplemental coverage enters the picture. This is a policy, sold by a private insurance company, that acts as secondary coverage to Medicare. 

It pays what is left over after Medicare pays what it will. As a point of reference, our Medigap, or supplemental policy, has worked perfectly for the last several years. We have had to pay nothing for any service or procedure after Medicare and the supplemental policy have taken care of all charges.

Just like the rest of Medicare, there is a specific enrollment period for Medigap coverage. You can buy any policy that is offered for sale in your state, regardless of your health status. The amount of supplemental coverage, the monthly cost, and any deductibles are different for each policy offered. You decide how much supplemental help you want and can afford. 

A word to the wise, though: if you decide to buy a less expensive policy at some point in the future from the same company you may be prevented from doing so due to pre-existing conditions, at least for a period of time. 

Speaking of costs, Part A Medicare coverage costs you nothing since you already paid into the Medicare fund while you were working. Part B coverage does carry a monthly cost. For 2023 most will pay $164.90 per month. There is also a $226 yearly deductible. 

Part D prescription coverage costs vary depending on the plan you select and the level of drug coverage. A recent change has shrunk the "donut" hole," or the amount you must pay after you and your Part D company has spent $4,660 on prescription drugs in a calendar year. Even so, there are various limits on what you are required to cover on your own until you emerge from this coverage gap. 

What is Covered?

There is no simple answer to that question. Medicare publishes a booklet that is an excellent resource. In general, here is what you can expect:

Part A pays part or all of inpatient hospital care, inpatient care at a skilled nursing facility, hospice care services, and home health care services for a defined period of time. As you might guess there are all sorts of qualifications and exclusions for this list but this is the primary purpose of Part A coverage.

Part B helps cover medically necessary services like doctor visits, outpatient care, durable medical equipment, and several preventive services and screenings.

Part C is the designation of Medicare-approved private insurance companies that has various coverage options and costs. You still have Part A and Part B coverage, but the specifics are likely to be different from the original Medicare. Generally, coverage is more complete and the costs tend to be lower. But, that comes with network restrictions and gives the company the ability to deny coverage for certain procedures or tests.

Part D covers some of your prescription drug costs. If you don't need a lot of drugs now, it still may be wise to take this coverage because of late enrollment penalties. Part D is provided by private insurance companies and varies widely in costs and coverage. As my example above notes, rates can vary widely and change dramatically from year to year. 

Importantly, these items are not covered by Medicare (not a complete list...some of these services are covered by some Medicare Advantage Plans):
  • Routine Dental care
  • Dentures
  • Cosmetic surgery
  • Hearing Aids
  • Exams for fitting hearing aids
  • Long term care

If you'd like more detailed information or see if specific services are covered, this government website should be your first stop.

On a personal note, Medicare, along with a supplemental policy and Part D drug coverage, has been a blessing for us. While we are still spending just over $680 a month for premiums and prescriptions, the process is so simple: no paperwork, no claim forms, and no hassle. Before both of us reached coverage age we were spending close to $1,100 a month, just for the insurance coverage. Today I am sure we would be forced to pay almost double that for much poorer coverage through the private insurance market if we weren't Medicare-qualified.

Another reminder: this post is for informational and general guidelines only.  Check with Medicare,gov, or your Medicare Advantage plan, supplemental, or Part D coverage company to obtain the latest info.

There are some advantages to turning 65, but one of the most cherished is Medicare coverage. It is a life-changer!

Questions? Feel free to ask. Comments? Feel free to type away!


  1. You are so kind to share an overview of Medicare-it can be daunting. I helped Mom way back. She had a fairly tight fixed income so she loved the Advantage plan. She knew exactly what healthcare would cost her every single month and it gave her peace-of-mind. We changed her Part D provider every year. It is amazing how they will mess with premiums. And all of her meds were cheap old things. So dumb but we played the game.

    I've heard so many people say "I'm going to wait because I don't need it". Those penalties are expensive over time!

    1. Waiting is not a good choice because of the lifelong premium increases, though there are some exceptions in unusual cases, like after a natural disaster.

      Because they are private companies providing the coverage, our supplemental and Part D plans show noticable increases every year. As long as the coverage fits our needs, we stay put. But Humana is close to losing us as Part D customers. Any increase next year that even comes close to this year's big bump will send us to someone else.

  2. Great overview, Bob. We are both using an Advantage plan, because in our area it's offered by the biggest healthcare system in the state and includes all our docs plus specialized care if we need it. We did change at one point based on copays and our medical needs at that point, and each year there seem to be differing copays as the 2 biggest carriers here compete for customers.

    We initially used an agent to explain all of it to us and she's been great at reviewing it every year. We also pay for enhanced dental and vision and that's been worthwhile so far. We are lucky to have no major health issues right now and DH has a few prescriptions that are free if he orders them via Express Scripts. But it makes total sense to review coverage every year, as these policies are a moving target IMO.

    1. I am afraid Betty and I are permanently soured on letting a private company be the major gate-keeper of our health coverage and choices ever again. I know they have to adhere to guidelines from Medicare, but our 30 years of having to buy insurance on the private market put them in the "never again" category.

      I know plenty of people like you who are having a good experience, and I know our stance is costing us money. But, peace of mind is more important.

    2. Ours is a not-for-profit, but I understand your point, Bob. When we decided to go to an Advantage plan, we had just paid a pretty penny for premiums and copays to the Blues, so we looked for all our docs on our current plan and compared copays for what we were spending. (DH had some surgery that required frequent lab work for a year or so and the copays and his meds were ridiculous that year.) We do look at it yearly, but our son also designs healthcare plans for companies and he told us to switch, too. It turned out to be good advice. But, as I said, it's still a yearly exercise and a moving target.

    3. Also, I completely agree that peace of mind is Goal One.

  3. I would love it if we could buy into Medicare before we turn 65. At 54 I have a way to go and would love to quit my full time job but am scared to go on my own for health insurance.

    1. There has been plenty of discussion about opening up Medicare for those younger than 65. So far, the political will hasn't been there for something that seems so logical.

  4. I'm pretty darned sure Madeline will jump in here, but as a retiree in a family of health care providers I encourage folks on Advantage plans to read the very fine print. They are not necessarily required to tell you all the out of pocket costs and their coverage is less. As a therapist my daughter sees her patients on Advantage plans able to stay half along as those on regular supplementals. They're great for healthy people. I just had a gal neighbor try out an Advantage plan for a year who is jumping back to a supplemental because it covered less than half of what her supplemental does. I encourage people to speak to a non profit volunteer broker rather than a professional. There are many out there.

    1. I won't consider an Advantage program because of my distrust of the pro-profits to care about me.

      Inportantly, Advantage programs usually don't travel well, meaning their coverage is often restricted to certain areas of the country. If you have a great plan in Arizona but travel to Alabama and get sick, you might find yourself with limited options. This is something to investigate before any travel.

    2. We’ve been happy with Humana Goild Medicare Advantage in Arizona.I had an agent explain a lot of plans to us and we re3ad all the fine print.We do have a reasonable. yearly “out of pocket” which is less than the cost of a medigap policy on a yearly basis. Recently we have become caregivers for a family memmber who is ill and I have had MUCHO stress.I found an excellent counselor on my plan, I don’t need a referral, and I can see her for an hour,every week,which is helping me cope,immensely. I’ve got great Doctors on my plan and see my dermatologist and my primary office, no problems.ALl blood work done in my primary office is covered. I have emergency coverage for out of town and air ambulance coverage. I guess you do have to look carefully.the plans do have to provide as much/the same as Medicare does, as a MINIMUM, we get dental and over the counter med coverage and some other benefits not covered by traditional Medicare. I know it is a peace of mind issue, and from what I hear, the coverage varies from state to state but at MINIMUM covers what medicare does.I’ve had two skin cancers removed, one Mohs surgery and one just an in office procedure, also, covered completely with a small co pay.

    3. I'm going to chime in and agree that it varies by state and plan. We have an Advantage plan, and DH had a $65K surgery at the U of Michigan a few years ago. It cost us $250. IMO, it depends who is in your plan and (of course) what it covers, copays, etc. We're really happy with ours.

  5. I agree, Medicare is a blessing, and also very complicated. I know I should revisit my medigap coverage, but it seems like such a big job to do the research, read the fine print, compare the plans, and then trust that the new insurance company will live up to its promises. But ... maybe your excellent post will inspire me to do what I know I should.

    1. Thanks, Tom. I investigate my Part D plan choices every year; my supplental has proven itself time and time again over the last seven years.

  6. Good, clear summary. I remember when we first qualified for Medicare. It took time and care to even understand what was going on. I changed companies twice but my husband Art kept his the same. I've gone back to the HMO (Kaiser) because the process of getting primary care plus specialities is just about seamless, and the care is excellent. We had some hiccups the first year that Kaiser had a contract with Banner Health for our time in Tucson, but we've figured it out now. This is one of the reasons I'm grateful to be older.

    1. When I was first trying to figure Medicare out, if was intimidating. But, as you say, Medicare is one of the better parts of being older.

  7. I’m a chicken in switching to a different supplement plan and I know it. I retired out of a state government job and kept their blue cross each year. If I ever leave the state retirement plan I can never get back in. It costs 355.00 a month but 750.00 max out of pocket coverage, good medication coverage and I don’t need to worry about shopping around each year. Or anything like preexisting etc.

    1. If the plan you have makes you comfortable and it does what you pay it for, then stay with it.

      The good news is that if the state ever makes changes that bother you, you can always switch to something else. In the meantime, relax.