Medicare changes just about every year, and this year is no different.
Changes are coming to Medicare, but that’s nothing new. Slight differences are made to Medicare every year to make it work better for enrollees, and this year is no different.
The first thing to understand is that Original Medicare comprises two basic building blocks: Part A and Part B. Part A, which mainly covers hospital care, is generally available at no monthly premium. As long as you or your spouse have paid into the Medicare program through your taxes for at least ten years, you won’t have to pay that Part A premium. Part B, which mainly covers doctor visits and tests, has a monthly compensation based on income. Most Medicare beneficiaries pay the standard Part B premium. A small percentage of Part B enrollees have a higher income that requires them to pay a higher Part B premium.
The Medicare “Donut Hole”
The coverage gap often referred to as the “donut hole,” is when your total drug spending, combined between you and your insurance company, reaches a certain amount. If you get that amount, you’re in the donut hole, and you’re responsible for a higher share of the cost of your medications. The donut hole has a limit to the amount you’ll have to pay. After you reach this limit, you leave the donut hole and have catastrophic coverage to pay a minimal share for your drugs.
The good news is that the coverage gap is shrinking, and sooner than expected. Since 2020, Medicare beneficiaries who reach the donut hole will only pay 25% of the cost of their brand name and generic prescription drugs.
Medicare Advantage on the Rise
One of the most significant changes to Medicare over the past ten years has been the increase in people choosing Medicare Advantage plans.
One reason for this growth is that Original Medicare doesn’t cover all medical expenses, and some individuals want or need more coverage. Another reason is that people have come to expect their attention from a private insurance company. Medicare Advantage plans can include:
- Care management—which connects members with their health plan’s experts for complex medical needs
- Prescription drug coverage
- Reminders for preventive visits and prescription refills
- Resources for healthy lifestyles, often right in the local community
- Vision, dental, and hearing coverage options
- Gym memberships or other ways to get or stay active and healthy
The Make-up of a Medicare Advantage Plan
Medicare Advantage plans take the place of Original Medicare—or Part A and Part B. They’re offered by private insurance companies and cover everything Original Medicare does—plus, they often provide additional benefits like gym memberships, prescription coverage, and health and wellness programs.
When you select a Medicare Advantage plan, you’ll still need to pay your Part A and Part B premiums (remember, the Part A premium is no cost for most beneficiaries). But what you don’t need to think about with Medicare Advantage plans are Part A and B deductibles. Instead, you’ll be responsible for your Medicare Advantage plan’s medical deductible, as well as a prescription deductible, if one is applicable.
Plan Ratings Can Change Every Year
How well a health plan takes care of its members should be an essential part of your Medicare decision-making process.
And there is always a chance that additional Medicare changes will be announced in the coming months, so it’s essential to keep an eye out for updates.
That keeps you informed and well-equipped to help your older adult choose the best plan for their needs when it’s time to re-enroll or change plans.