Many people planning their retirement focus primarily on Social Security. That’s because they have some control over the benefits they receive from the government program, and the hard money that Social Security pays out is essential to covering living expenses of all kinds.
However, Medicare is often even more important to the financial well-being of retirees than Social Security. The federal government’s program covers a large part of the healthcare costs for those over 65 years of age.
The challenge with Medicare, however, is that the program offers seniors many different options to choose from. In some cases, making the right choice can mean the difference between full coverage, partial coverage, or no coverage at all. For this reason, Medicare offers an annual open enrollment period beginning October 15 and ending December 7. By using open enrollment, you can save money and ensure continued access to the healthcare you need.
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Below, learn about three potential changes you might consider to save money or give you better healthcare in 2023.
1. Switch between traditional Medicare and a Medicare Advantage plan
With open enrollment, you can make broad changes to the Medicare coverage you receive. Those who were previously part of the traditional Medicare program and received Part A hospital insurance and Part B outpatient medical coverage may choose to switch to a Medicare Advantage plan instead.
Medicare Advantage plans often offer lower overall premiums with more extensive coverage than traditional Medicare. But the private insurance companies that offer them set more restrictive limits on the healthcare providers you can use to get coverage.
However, if you have used a Medicare Advantage plan in the past and wish to switch back to traditional Medicare during the open enrollment period, you can do so as well. Remember that the key is to determine not only the premiums you pay, but also the total costs associated with both options. When one option offers real advantages over the other, switching can put more money in your pocket.
2. Switching from one Medicare Advantage plan to another
Because private insurers offer Medicare Advantage plans, most Medicare participants have more than one to choose from. Different providers offer different types of coverage, so you may find that your current coverage doesn’t provide as much savings as a competing insurer’s plan. You can make the change during open enrollment.
When making this assessment, pay attention not only to the monthly premium costs, but also to the deductibles, co-payments, and annual expense caps that the plans you are considering offer. If you’re given an opportunity to make significant savings, it’s wise to make the switch.
3. Changing your prescription drug coverage
Finally, those looking for coverage for prescription drug costs often consider Medicare Part D plans, especially if they use traditional Medicare. Some Medicare Advantage plans include prescription drugs in their coverage, but others don’t, requiring their participants to follow Part D as well.
As you age, your healthcare needs change, and your current Part D plan may not cover a medication you need now. If you find a better plan that offers coverage, you can make the switch. If you have not previously enrolled in Part D, you may do so during open enrollment, and those who no longer desire a Part D plan may also remove their coverage.
Be smart about Medicare
If you use the open enrollment period wisely, Medicare can save you a lot of money. Look at your coverage between October 15th and December 7th to see if changing is the best move for you.
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