It’s time to review your Medicare plan. Here’s what you need to know.

Medicare open enrollment for the 2016 plan year occurs between Oct. 15, 2015, and Dec. 7, 2016. More than 50 million Medicare recipients will review or change their policies due to alterations insurance companies may make to co-pays, premiums and maximum out-of-pocket costs for the 2016 plan year.

Recipients will also have the opportunity to change their Part D prescriptions drug plan and switch between original Medicare and a Medicare Advantage plan.

“Even if you are satisfied with your current coverage, it is important to compare your current plan to what will be offered in 2016 and to what other alternative plans will offer to ensure you have the best coverage for your situation,” says Crystal Manning, Medicare specialist at JRG Advisors.

Smart Business spoke with Manning to find out what this may mean to you, or your employees and dependents.

Why do you need to review Medicare plans every year?

Alternative plans may offer better health and/or prescription drug coverage at a more affordable price. A simple switch to a competing plan can save thousands of dollars in out-of-pocket costs, including prescription drug co-payments.

What is the Annual Notice of Change?

If you have a Medicare Advantage plan or a stand-alone Part D plan, you should receive an Annual Notice of Change and/or Evidence of Coverage from your current plan. Review these notices for cost, benefit and rule changes for the upcoming year.

If you’re dissatisfied with any change, you can choose a different plan during open enrollment. Changes made to your coverage will take effect Jan. 1 of the next year.

What’s a Medicare Advantage Plan or Part C?

The Balanced Budget Act of 1997 authorized the use of alternative health care plans to provide Medicare benefits, in order to give beneficiaries more options and help control costs. The new program was known as Medicare+Choice or Medicare Part C.

In 2003, the Medicare Prescription Drug, Improvement, and Modernization Act made additional refinements to the program and renamed it Medicare Advantage.
Plans available under the Medicare Advantage program include Private Fee-for-Service Plans, Health Maintenance Organizations, Preferred Provider Organizations, Special Needs Plans and Medical Savings Accounts. Medicare approves Medicare Advantage plans, but private insurance companies run them.

These plans must take the place of Medicare, rather than function as a supplement. Medicare Advantage plans provide Part A (hospital insurance) and Part B (medical insurance) coverage and must cover at least all of the ‘medically necessary’ services that the original Medicare Plan provides. This coverage can include Medicare Part D prescription drug coverage and extra benefits such as dental and vision coverage as well as health club memberships.

So, what do you need to do now?

Start the review process early.

If you are enrolled in a Medicare Supplement plan, you don’t need to do anything during the Medicare open enrollment, you have guaranteed coverage for life, as long as your premiums are paid. Medicare is the primary payer and your supplement is the secondary. Any provider that accepts Medicare will honor your supplement product.

If you are enrolled in a Medicare Advantage plan, research your options and make sure you understand what you’ll receive and how much you’ll pay out of pocket.

This includes checking your deductibles, which can change from year to year. Also, make sure the doctors and hospitals you use are still in the plan network and prescriptions are covered.

If you are still working or have retiree benefits, make sure you understand how those benefits coordinate with Medicare.

Finding the right Medicare plan, figuring out deductibles and worrying about the prescription drug ‘doughnut hole’ can be confusing. Some Medicare plans during the past year may have been altered or premiums may have risen or fallen. Don’t ignore your opportunity to compare plans, and don’t assume your plan will not change.

Discuss your Medicare options with an experienced Medicare specialist to avoid any penalties and confusion and to make the best choice for you.

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