While all Medicare beneficiaries are entitled to receive the same set of core benefits, seniors shouldn’t assume all plans are created equal. Some Medicare plans offer additional benefits, while others may have limits that could affect when and where you get care. Premiums can also differ between plans, and you might even pay extra depending on when you enroll.
Here are some of the key plan differences and seven ways to make the most of your Medicare coverage.
1. Enroll at the right time.
Most people have an initial enrollment period for Medicare that runs from three months before their 65th birthday until three months after their birthday month. Neil Krishnaswamy, a certified financial planner with Exencial Wealth Advisors in Plano, Texas, says enrolling in a timely fashion is important to minimize costs.
“Be sure to enroll in the proper time period, or you could be subjected to some late penalties,” he says. For example, Medicare Part B premiums increase 10 percent for every 12 months a person waits to enroll.
2. Pick the right type of plan.
The next way to maximize Medicare benefits is to select the right type of plan. Retirees have two main options:
— Original Medicare
— Medicare Advantage
Original Medicare includes Parts A and B and offers benefits paid directly by the government. Most people don’t pay any premiums for their Part A coverage. Part B premiums will cost most people $104.90 a month in 2015, and the coverage comes with a $147 deductible. Medigap, or Medicare Supplement plans, can be purchased to complement original Medicare coverage. Those who buy a Medigap plan should do so during their initial Medicare enrollment period to avoid medical underwriting and potentially obtain lower premiums.
Medicare Advantage plans, sometimes called Medicare Part C, are offered through private health insurance companies and come with a variety of premiums and deductibles. By law, these policies must include everything covered by Medicare Parts A and B, and many have additional benefits built-in such as dental, vision and prescription drug coverage.
Travel is a main consideration when deciding between original Medicare and Medicare Advantage. While original Medicare is accepted by providers nationwide, a Medicare Advantage plan may have a limited local network.
“If you’re a retiree and have an RV, you might be better offer with an original policy,” says John Sarich, a vice president at VUE Software, a firm that works with insurance companies to automate processes. Out-of-network expenses could add up quickly for Medicare Advantage participants who need medical attention away from home.
3. Double check the details when enrolling in Medicare Advantage.
According to Greg Hammer, owner of Hammer Financial Group in Schererville, Indiana, it isn’t simply premiums that can vary with Medicare Advantage plans. They may have different deductibles, copayments and out-of-network costs.
“The big advantage [of original Medicare and Medigap policies] is that you know exactly what’s going to be your total out-of-pocket cost for the year,” Hammer says.
Medicare Advantage doesn’t offer that certainty, which means people selecting one of these plans need to be sure they fully understand all the potential costs. They should also find out whether their preferred doctors participate in the network and how they can access specialist care.
For Medicare Advantage plans set up as HMOs, all care, including specialist referrals, may be routed through a primary care provider. Other plans may allow participants more direct access to specialist care.
4. Evaluate your prescription drug needs.
To make the most of Medicare coverage, beneficiaries need to ensure their medications are covered by their plan. Medicare Advantage plans that include prescription drug coverage use formularies that dictate which medications are covered and what copay is required. In some plans, brand name or more expensive medicines come with higher copays.
Original Medicare does not include prescription drug coverage, so participants need to purchase a separate Part D plan. Going without prescription drug coverage comes at a cost as well. Medicare beneficiaries without coverage for 63 days or more may be subject to a Part D late enrollment penalty.
5. Make use of wellness programs.
Once you’ve selected your plan, it’s time to make the most of it.
“Every Medicare Advantage plan has a drug adherence program,” says Rajeev Kapoor, partner in the digital health care practice of A.T. Kearney, a global management consulting firm.
Plans may have incentives, such as coupons or discounts, to encourage patients to take medications as prescribed. Kapoor says similar government adherence programs may also be available to Medicare beneficiaries in some areas.
Health insurance companies may also run wellness programs that give Medicare Advantage plan participants access to special benefits like reduced gym membership fees. Other programs may connect participants to nurses or wellness coaches who provide personalized assistance in reaching health goals.
6. Get your free preventive care.
Whether you have original Medicare or Medicare Advantage, you’re entitled to free preventive care as part of your benefits. These services are typically provided without any out-of-pocket costs. They include the following, among others:
— Annual wellness visit
— Smoking cessation counseling
— Cancer screenings
— Diabetes screenings
— Flu shots
— Bone density tests
For a complete listing of covered preventive services and how often they can be used, consult the Guide to Medicare’s Preventive Services.
7. Don’t overlook telehealth options.
One last way to maximize your Medicare is to use mobile health technology, often called telehealth.
Medicare Advantage plans, in particular, may offer ways for you to connect with a physician via email or over the phone. Kapoor says telehealth offers multiple benefits: It can be less stressful for seniors and may make them more likely to seek help for small medical problems before they turn into major health concerns.
“If questions can be answered remotely, that removes the stress of going to the doctor or emergency room,” Kapoor says.
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