Navigating Medicare open enrollment can be confusing and complex, but it’s a necessary part of the retirement planning process and to see if any changes need to be made to existing plans. Since Medicare open enrollment is now open, this is a great time to reassess your coverage to ensure it still meets your needs. To help with this process, we’ve put together a summary to simplify what you need to know.
The Four Parts of Medicare
Medicare coverage is divided into 4 parts and each part has different coverage levels:
- Medicare Part A: Also known as hospital insurance, Medicare Part A covers inpatient hospital care and some nursing care coverage. If you or your spouse paid Medicare payroll taxes during your working years for at least 10 years, Part A is free for you. If you didn’t, you can still get coverage by paying a monthly premium.
- Medicare Part B: Part B is medical insurance coverage for some medical conditions and preventative care, including doctor visits and other outpatient services. You will pay a monthly premium for Part B coverage. Together, Parts A and B are known as Original Medicare.
- Medicare Part C: Known as Medicare Advantage Plan, this is an alternative to Original Medicare that is offered through Medicare-approved private companies. This plan bundles Part A and Part B and often includes Part D as well. Medicare Advantage plans also often cover additional services not covered by Part A, Part B, or Part D, including vision, hearing, and dental visits.
- Medicare Part D: This optional private insurance add-on includes drug coverage. Not to make things even more confusing, but Part D has a late enrollment penalty. Even if you don’t need prescription coverage when you are first eligible for Medicare, enroll in the plan to avoid extra long-term costs.
Your Open Enrollment Options
Keep in mind that open enrollment is not for those who have not yet enrolled in Medicare. If that’s you, your initial enrollment period is based upon your birthday, not a set date on a calendar. You need to sign up for coverage during the window of time that starts three months before the month of your 65th birthday and ends at the end of the third month after, for a total of seven months.
The open enrollment period affects each part separately. Here’s what you can do with your Medicare coverage:
- If you have Medicare Parts A & B,you can switch to Part C.
- If you have Medicare Part C, you can switch back to Original Medicare or change to a different Medicare Advantage Plan.
- If you have Part D, you can switch to a different Part D plan or drop your prescription drug plan.
You can also use this time to enroll in Part C and Part D for the first time.
When Can I Make These Changes?
Medicare open enrollment is from October 15th through December 7th each year. Making changes to your plan during this time provides the most flexibility and will affect your 2023 Medicare coverage.
Don’t get this confused with the Medicare Advantage open enrollment period that occurs from January 1st to March 31st, where those with Part C can change to a different Part C plan or switch to Parts A and B. Any other changes need to happen in the October-December enrollment period.
Overwhelmed? We Can Help.
There’s a lot to consider when reviewing Medicare enrollment options. It’s an important decision that can have a big impact on your wealth management strategy during your retirement years. At Center for Wealth Management, we help you through all phases of retirement planning so you can feel confident as you make this exciting transition. We’ll regularly review your situation to help make sure you’re on track with your needs, goals, and lifestyle. To learn more, call (248) 220-4321 or email email@example.com. You can also schedule a meeting by visiting www.calendly.com/cwmrob/initial.
Robert Moore is senior partner, financial planner, investment advisor, and co-owner of Center for Wealth Management, an independent, fee-based wealth management company based in Troy, MI. With more than 15 years of experience, Rob provides customized advice and solutions that are in the clients’ best interest. He strives to always go above and beyond his clients’ expectations, helping them retire with more security than they had before, and invest their time and energy in what’s most important to them. Rob specializes in working with DTE Energy employees, helping them maximize their benefits so they can reduce taxes, prepare for retirement, and protect their families through a comprehensive planning process. Rob graduated from Michigan State University and holds the CERTIFIED FINANCIAL PLANNER™ and Chartered Financial Consultant® (ChFC®) certifications.
Rob is known as a diehard family man who enjoys spending time with his beautiful wife, Jill, his daughter, Brookelyn, and his son, Brayden. When he’s not working, you can find him playing basketball once a week, squeezing in a round of golf, and watching college football and basketball with friends and family. He is passionate about enriching the lives of others through his church involvement and service at a community addiction program. Learn more about Rob by connecting with him on LinkedIn.