How to make the most of Medicare open enrollment

Once you reach age 65, Medicare becomes an important part of your health coverage. But it is not something you simply enroll in once and forget about. Each year, you have a chance to review your options and make changes.

The annual Medicare Open Enrollment window gives you time to reassess your health care needs and check whether your current plan still works for you. Any changes made during this period generally take effect on Jan. 1 of the next year.

Because both your health and Medicare plans can change over time, it is wise to look closely at your coverage every year. Insurance companies may alter benefits and costs, and some plans may no longer be offered. If you do nothing during open enrollment, you will usually stay in your current plan, provided it remains available. Reviewing your choices may reveal a plan that better fits your needs or helps reduce costs.

You have several Medicare coverage options to consider:

• Original Medicare (Parts A and B) pays for hospital care and medical services such as doctor visits. Part A usually has no monthly premium if you have worked for at least 10 years. Part B comes with a monthly premium, and people with higher incomes may pay more. It also has an annual deductible and cost-sharing requirements, with updated amounts typically announced in November for the following year.

• Medicare Advantage (Part C) is a private insurance alternative to Original Medicare. Many plans combine Part A, Part B and usually Part D, and may also include extra benefits such as vision and dental coverage.

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• Medicare Part D offers separate prescription drug coverage for people who remain on Original Medicare. Part D plans include a $2,400 annual limit on out-of-pocket costs for covered prescription drugs, though covered medications differ by plan.

• Medicare Supplement (Medigap) policies help pay for certain out-of-pocket expenses that Original Medicare does not cover.

When comparing plans, keep the following in mind:

• Out-of-pocket costs, including premiums, deductibles, copayments and other expenses not covered by Medicare.

• Prescription drug coverage. Even with the annual spending cap for covered drugs, each plan may cover a different set of medications, so be sure your prescriptions are included.

• Provider access. Confirm that your doctors and hospitals are in the plan’s network.

• Expected health care needs. If you anticipate ongoing treatment, specialist visits or scheduled procedures, make sure the plan offers suitable coverage.

• Travel considerations. People who travel often may want supplemental coverage for emergencies outside the U.S.

Even if you like your current coverage, do not assume next year’s plan will be identical. Premiums, provider networks and covered medications can all change from year to year, which makes an annual review worthwhile.

Do not let your Medicare coverage run automatically without checking it. Use the annual open enrollment period to help ensure your plan still meets your needs in the year ahead.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor. Edward Jones, Member SIPC.