Now's the time to compare Medicare plans for 2023. Visit Medicare.gov through December 7 to compare plans and make any changes. If you decide to change plans, your new coverage will start January 1. Why compare plans for next year? Plans change, and your health care needs, or situation may have changed, too. Think about what benefits matter to you and find a Medicare plan that fits your needs.
Coverage Options
There are two main ways to get your Medicare coverage: Original Medicare and Medicare Advantage. Original Medicare includes Hospital (Part A) and Medical (Part B) insurance. If you want drug coverage, you can add a separate Drug plan (Part D). You can also add a Medicare Supplement Insurance (Medigap) policy to help pay your out-of-pocket costs. Medicare Advantage Plan is an all-in-one alternative to Original Medicare. These "bundled" plans include Part A, Part B, and usually Part D. Most plans offer extra benefits—like vision, hearing, dental, and more.
Original Medicare
Part A covers hospitals, rehab, and hospice care, whereas Part B covers doctor visits, lab tests, screenings, and other outpatient services. While Part A is free for most people, you’ll pay monthly premiums for Part B plus deductibles, copays, and coinsurance.
Pros: You have the freedom to visit any provider or hospital in the U.S. that participates in Medicare and don’t need to work with a primary care physician to see specialists. This flexibility is ideal if you travel outside of your home network or have existing relationships with doctors you want to keep.
Cons: Services have deductibles and copays, which may require you to purchase a Medigap or Medicare Supplement Plan to cover your out-of-pocket spending. You will also need to purchase prescription drug coverage (Medicare Part D) separately.
Since it doesn’t cover prescription drugs, you will need to purchase Medicare Part D separately. You’ll need to sign up as soon as you become eligible for Medicare, even if you don’t use prescription drugs, to avoid paying late enrollment penalties.
Pros: Copays and other plan details vary by state and insurer, but they will cover most of the cost of your prescriptions.
Cons: After exceeding coverage limits, you’ll pay the full cost of your medications until a Medicare threshold is reached.
Finally, Supplemental insurance is private insurance that fills the coverage gaps in Parts A and B of Medicare and helps with deductibles, copays, coinsurance, etc.
Pros: It limits your out-of-pocket costs for Original Medicare.
Cons: There are many different types of Medigap plans, all with different details.
Medicare Advantage
Offered through private insurers, Part C is often structured like an HMO or PPO and provides comprehensive health coverage by combining Parts A and B.
Pros: Many Part C plans cover extra services like vision, hearing, and dental and may include prescription drug coverage. Plans have an annual limit on your total out-of-pocket costs.
Cons: In addition to paying a part B premium, you’ll typically pay an extra monthly premium for the Medicare Advantage plan. Networks change, doctors can leave, and benefits can change over time.
Choosing Plans
Choosing a Medicare plan means balancing priorities and knowing what’s most important to you. Whether you’re looking into Medicare for the first time or taking advantage of annual enrollment to update your strategy, we’ve broken down the critical choices you must make into a simple decision-making tool (including the easy-to-understand questions you MUST ask yourself before choosing a plan). Which sounds like you?
Other Considerations
Here are some other things to consider when shopping for Medicare coverage:
• Check if your doctors are still in-network.
• Make sure your prescriptions are on the plan's list of covered drugs, or "formulary."
• Consider how the plan's deductible and other out-of-pocket costs factor into total costs.
• Some plans offer extra benefits, like vision, hearing, or dental coverage, that could help meet your needs in 2023.
A plan with the lowest premium may not always provide the lowest total cost to you; you also want to look at the estimated “Yearly Drug & Premium Cost.” Be sure to enter the list of prescription drugs you take regularly and consider other out-of-pocket expenses as part of your total costs. And always check that your drugs are covered by the plan you're considering before enrolling.
If you don't buy a Medigap policy when you're first eligible, you may not be able to buy one later, or you may pay more. If you don't join a Drug plan when you first get Medicare, you may pay a penalty for as long as you have Medicare drug coverage if you join later. Also, if you don't join a Medicare Advantage Plan when you first get Part A and Part B, you may have to wait for the next yearly Open Enrollment Period to join.
Sources:
1 - https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs
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