Carefully review Medicare options

The Savage Truth

Medicare has about 60 million enrollees, with roughly two-thirds in traditional Medicare Parts A and B (plus Part D and supplements) and one-third enrolled in the more comprehensive Medicare Advantage plans.

Every Medicare participant should review his or her options during the Medicare open enrollment period, which began Oct. 15 and runs through Dec. 7 for 2019 coverage. Coasting on your existing supplement and Part D drug plan could be a very expensive mistake.

Medicare enrollees are required to have a Part D prescription drug plan (unless they have other similar coverage). Part D is required even if you don’t take any prescription drugs. There’s a significant penalty for late enrollment in Part D, which could be costly when you eventually require expensive medicine.

Even more important, you must review the Part D plan changes for 2019. Your existing plan may no longer cover your meds next year. They might offer only generics, or they could charge higher co-pays.

Plus, there are some important changes in Part D itself. For example, the standard deductible for coverage will increase from $405 to $415. But the average monthly premium will decrease slightly.

In 2019, you’ll get a slightly better deal when you enter the donut hole — the point where you are required to pay for your own medicines until you reach the level of catastrophic coverage. In 2019, you’ll pay only 25 percent of costs for brand name drugs (down from 35 percent last year), and generic drugs will also have a lower cost to you in the donut hole period.

Another change: In 2019, you’ll enter the donut hole when you have reached a threshold of $3,820 spent on drugs — up from $3,750 last year. And the threshold for moving out of the hole and into that catastrophic coverage level — where the plan pays for all but 5 percent of your costs — rises to $5,100 (out of pocket) in 2019.

Comparing Part D plans doesn’t have to be complicated. Just go online to www.Medicare.gov and click on Part D. Then click on “How to Get Drug Coverage” and scroll down until you see a link to the Medicare Plan Finder.

Start by entering your current prescriptions in the Medicare Plan Finder. Line up the bottles to make sure you get the correct names and dosages. Then find the least expensive plan — or sort by your preferred pharmacy. You can sign up for the 2019 plan that best and least expensively covers your drugs.

There’s another big choice to make during open enrollment. For 2019, there will be an Extended Medicare Open Enrollment Period starting Jan. 1, 2019 and running through March 31. During this period, beneficiaries can either switch between Medicare Advantage plans or back to original Medicare.

You might be tempted to join a less expensive, all-in-one Medicare Advantage plan during this open enrollment period. Those premiums are expected to decline for 2019, according to eHealthInsurance.com. But first, read the fine print on those plans. Medicare Advantage plan networks of doctors and hospitals may be narrow.

Second, you might have a problem if you want to change back to the broader original Medicare plans. If you sign up for a supplement within 6 months of first joining Medicare Part B, you cannot be turned down for the most comprehensive supplement because of health conditions. But if you try to re-join after testing Advantage, you may not qualify for the best Medicare supplement plan.

Medicare is great, but the devil is truly in the details. Do not procrastinate. This is the time to avoid making an expensive mistake. And that’s The Savage Truth.

Terry Savage is a registered investment adviser and the author of four best-selling books, including “The Savage Truth on Money.” She responds to questions on her blog at TerrySavage.com.

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