Reviewing Your Medicare Plan

During the annual open enrollment period for Medicare which runs from November 15 to December 31, you may switch Medicare drug or health care plans. This year it is particularly important because of changes brought on by the new health care law.

As the health care reform law goes into effect, there are a number of changes affecting seniors. Even if the new health law will not affect your plan, you should still review your options for 2011. Prescription drug plans can change their premiums, deductibles and the list of drugs they cover. Medicare Advantage plans – private managed care plans that compete with traditional Medicare – can change their entire benefits package as well as their provider network. Many plans are also consolidating options and closing some policies. If you take no action, you will remain in your current plan.

Under the new health law, Medicare will now pay 100 percent of preventive care. That means beneficiaries will not have to pay deductibles or co-pays for certain preventive services, such as annual wellness exams. While many Medicare Advantage plans already offered this benefit, it is not mandatory for all types of Medicare plans. If you had a Medicare Advantage plan primarily because of its preventive care coverage, you may want to reassess whether that or any other Medicare Advantage plan is still the best option for you.

In addition, under the new health reform law, subsidies to Medicare Advantage plans are being phased out. In response, Medicare Advantage plans may stop covering extra benefits like dental and vision. Check your Medicare Advantage plan to make sure you will still receive the benefits you want.

The biggest change for Medicare prescription drug plan beneficiaries is the lowering of prescription drug costs for those who reach the “doughnut hole”. In 2010, after meeting a $310 deductible, beneficiaries pay only 25 percent of drug costs until the costs total $2830. Coverage then stops completely until total out-of-pocket spending for covered drugs reaches $4550. This lack of coverage is called the “doughnut hole”. In 2011, beneficiaries in the doughnut hole will receive a 50 percent discount on brand-name drugs and a 7 percent discount on generic drugs. Medicare will continue to count the full retail price of medications in computing the coverage gap, so seniors will pay a lot less to get through the doughnut hole. The health reform law also eliminates the doughnut hole by the year 2020.

You will also want to make sure that your Part D plan still covers the drugs that you need because the list of drugs that each plan covers changes from year to year.

In the past, if you regretted your Medicare Advantage or regular Medicare decision, you could change things from January 1 through the end of March of the following year. But in 2011, this period will last only from January 1 to February 15, and the only change that will be allowed is if you want to shift from a Medicare Advantage plan to traditional Medicare.

To evaluate plans, go to https://www.medicare.gov/find-a-plan/questions/home.aspx?AspxAutoDetectCookieSupport=1.

Contact an estate planning law firm for further information.