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Every year, millions of Medicare beneficiaries get the chance to make changes to their coverage for the upcoming year, but there can be a bewildering number of plans to choose from.
Medicare Part A, for instance, provides inpatient care, and Part B covers outpatient services. Together, they are known as “original Medicare.” Medicare Part D offers prescription drug coverage, and Medigap is supplemental insurance to help cover out-of-pocket costs with Parts A and B.
On the other hand, Medicare Advantage plans are managed by private insurance companies, such as Aetna, UnitedHealthcare and Blue Cross Blue Shield. They provide the same coverage as original Medicare and, often, coverage for prescription drugs, plus additional benefits, like vision and dental coverage.
But it doesn’t have to be that hard. If a Medicare Advantage plan is right for you, you can identify the best fit for your needs by focusing on a few key areas and knowing where to turn for help.
Tips When Shopping for Medicare Coverage
Here are six things to consider when shopping for your Medicare coverage options:
Take the time to shop and compare Medicare Advantage plans.
Look beyond Medicare Advantage monthly premiums.
Check your medication coverage.
Confirm your doctor’s network participation.
Understand the 5-STARS rating system.
Get help with your decision.
- Take the Time to Shop Although professionals encourage people to shop around and weigh their options, Medicare Advantage beneficiaries tend to stick with their existing coverage.
But not exploring your options could cost you a lot of money. In this instance, more information really is more power, especially since plan details can change from year to year.
There are several different ways to access the information you need to compare plans, including:
A licensed health insurance marketplace, such as eHealth’s online comparison tool.
A government-run marketplace, such as your local State Health Insurance Assistance Program or Medicare.gov.
U.S. News’ online search tool that can help you learn about plans that might be right for you.
When comparing plans, it’s important to look at the whole scope of benefits offered and consider which you’re most likely to need or use over the upcoming year. One common misconception is that if your current plan raises prescription drug prices or premiums or reduces benefits, all plans are likely doing the same. However, this is only sometimes the case. Costs can vary from plan to plan, and increases can be isolated to specific plans. - Look Beyond the Premiums
Most health insurance companies charge a premium – a set monthly payment to maintain coverage under a specific plan. Medicare Advantage is no different, but those premiums tend to be quite low.
“Medicare Advantage is so popular today in part due to its affordability,” explains Bob Rees, chief sales officer with eHealth Inc., a health insurance broker and online resource provider headquartered in Santa Clara, California. “In terms of monthly premiums, it tends to be significantly less expensive than Medicare supplement, for example. Many beneficiaries enroll in Medicare Advantage plans with no monthly premium at all.”
How much you’ll pay in premiums for a Medicare Advantage plan or Medicare prescription drug plan can vary widely depending on where you live and the specifics of the plan you’ve selected. For 2024, the average premium for a Medicare Advantage plan is $18.50 per month, according to the Centers for Medicare and Medicaid Services. - Check for Your Medication Coverage
Most Medicare Advantage plans include prescription drug benefits. If you currently take any medications, be sure to check the plan’s formulary – the list of drugs covered by that specific plan – to ensure your medications are on it. If your medicine isn’t, your doctor may be able to substitute another, or you can apply for an exception. You can also opt to choose a different plan at your next enrollment period that covers the exact medication you need.
Plans are required to cover most of the drugs in certain protected medication classes, such as antipsychotics, antidepressants, cancer drugs, immunosuppressants and HIV/AID medications.
Many Medicare and Medicare Advantage drug plans have preferred pharmacy networks, which means certain pharmacies have agreed to provide discounted prices. You’ll always pay less for your medications at these preferred in-network pharmacies, says Tatiana Fassieux, a Medicare education and training specialist affiliated with, and former chair of, California Health Advocates, a Medicare advocacy organization. - Confirm Your Doctor’s Network Participation
Provider networks frequently change, so be sure to confirm that your Medicare-approved doctor is still in your plan. After all, seeing a nonparticipating physician may leave you on the hook for higher out-of-pocket costs.
“Plans are required to give beneficiaries 30 days’ notice if their doctor’s contract is terminated midyear,” Fassieux points out.
In addition, she says, insurers must help you find a new physician who participates in their plan.
Plans are also required to send their members notices about the changes for the next year. These are called Evidence of Coverage and Plan Annual Notice of Change statements. You’ll receive these documents in September, and it’s important to read them carefully because they include vital information about your plan’s costs and coverage options in the upcoming year.
Other aspects to consider include whether the hospitals you would likely use are in-network and if you’ll have coverage outside of your local network. For example, most Medicare Advantage plans won’t cover medical care if you’re traveling outside of the U.S. However, some plans do offer supplemental benefits to cover emergency or urgent care needs when you’re overseas. - Understand the STARS Rating System
Medicare STARS is a quality rating system that measures Medicare Advantage and Medicare Part D prescription drug plans on a scale of one to five stars.
“The star ratings are underrated and underused, but I think they’re really important,” Hurley says. “I personally wouldn’t enroll in a plan with three stars or less.”
You can search for highly rated plans in your state with U.S. News’ analysis of Medicare Advantage plans in 2024. Plan profile pages include detailed CMS ratings so you can see how the plans stack up against one another. - Get Help With Choosing a Medicare Plan
While selecting the right Medicare plan can seem daunting, the good news is there are many resources and experts available to help.
With the Plan Finder tool at Medicare.gov, for instance, you can find and compare Medicare Advantage and Medicare prescription drug plans available in your area by searching your ZIP code.
SHIP programs offer free, no-obligation, in-depth guidance and counseling regarding Medicare options to eligible beneficiaries and their family members. You can find your local program using the Medicare.gov live chat feature or by calling 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048.
Most people need to enroll in Medicare during the initial enrollment period, which is the seven months surrounding one’s 65th birthday – including the three months before your birthday month and the three months after. For those receiving Social Security payments, you’ll automatically be enrolled in original Medicare when you turn 65.
If you don’t apply for Medicare during this period or you don’t qualify for a special enrollment period, you may be hit with late enrollment penalties and lapses in coverage.
If you’re still working and have employer-sponsored health insurance, you don’t have to enroll in Medicare during that initial enrollment period. An employer group health plan can serve as your primary carrier regardless of your age. When you do retire or otherwise lose that insurance coverage, you then have up to eight months to enroll in Medicare or a Medicare Advantage plan without penalty, provided you can prove that you had creditable coverage when you first became eligible for Medicare.
If you’re already enrolled in a Medicare Advantage plan, you can review your selections and change plans in the Medicare Advantage-specific enrollment period, January 1 to March 31 every year. (The Medicare annual open enrollment period is October 15 to December 7.)
