Open Enrollment – More Important Than Ever
It’s that time of year again, called open enrollment, when older Americans have a window of opportunity to reevaluate their healthcare providers and coverage. This period affects nearly 9 out of 10 of us who either have Medicare Supplemental Insurance (Medigap) or belong to a Medicare Advantage (MA) Plan. You can go here for some basic information on the different parts of Medicare. While it has always been important to review our plans every year, as I’ve emphasized in past blogs, it’s even more important this year because there are some changes and information that could have an impact on your healthcare in 2025. Did you know that only 3 seniors out of 10 reviewed their Medicare coverage last year? What I’m saying here is – TAKE THE TIME THIS YEAR TO REVIEW YOUR PLAN!
I will give you important links and info on where to can go to get the tools the government provides to help you evaluate your healthcare and prescription drug plans below, but first, I want to review some of the important changes and information that will affect plans in 2025 and then talk about some of the negative ways the government has changed Medicare and the plans the administration is using to hide the potential impact of these changes.
The Centers for Medicare & Medicaid Services (CMS) just released the star ratings for different health plans. CMS evaluates various quality measures, including customer service, member experience, and health outcomes, and gives each plan a star rating. The average star rating last year was just over 4. Some MA plan’s star ratings dropped, which has caused quite a stir both by those who have stock in these plans and, more importantly, those who belong to an MA plan. There have even been some insurers that have quit offering their plans in some areas. CMS has reduced some payments to MA plans and has been under pressure to further regulate this fastest-growing part of Medicare coverage. The important thing to remember is the MA and Medigap plans are different depending on where you live. While the media is prone to focus on anything that is negative, the best plan for you is the one that best fits you. Your evaluation should be based on your past experience with the plan you now have, any changes that your current plan is making to your coverage options in 2025, and the plan benefits offered by other plans in your area. You may actually find that next year’s current plan or another plan in 2025 fits you even better than what you currently have.
There are two very encouraging changes to Medicare Part D, Medicare’s Prescription Drug benefit, in 2025. The first is the $2,000 dollar cap on out-of-pocket charges for prescription drugs. Seniors will never pay more than $2,000 a year for prescription drugs. No more donut holes, no more huge payments due to expensive medicine. This is something that I’ve been lobbying for during my entire 29 years in healthcare public policy. Another change is the ability to spread your out-of-pocket costs over the entire year. If you are taking an expensive medicine that might cost $2,000 a month, rather than requiring you to come up with $2,000 in January, you can pay the $2,000 in 12 monthly payments with no interest! The most your monthly payment will ever be is $167. This new payment program doesn’t reduce your yearly costs it just allows you to spread it over 12 months. The caveat to this program is you have to opt in to take advantage of its benefits. It’s NOT automatic. These are two very positive changes and should help as you plan your finances for next year.
Unfortunately, the Inflation Reduction Act (IRA) has already had some negative impacts on Medicare. The IRA has put pressure on insurance companies, causing them to reduce the number of plans available for seniors to choose from – this year, it dropped by an unprecedented 32%. Fewer options to choose from reduces the chances you’ll find a plan that fits your needs, and less competition means higher prices. This is already happening, with projected substantial premium increases for next year. What bothers me the most is the reaction of the current administration to these IRA-forced premium increases. They decided to institute the Medicare Part D Premium Stabilization Demonstration Program, which uses taxpayer money to soften the impact of the oft-maligned IRA. This approach is estimated by the CBO (the nation’s bipartisan accounting arm) to cost taxpayers 21 BILLION dollars over the next 3 years. I can guarantee that older Americans don’t want or expect the taxes of younger Americans to be used to cover up the impact on seniors of bad legislation.
Well, that’s the good and the bad changes to Medicare for 2025. Besides telling your lawmakers how you feel about these changes - this is your chance to take control of your healthcare by reviewing your plan and choosing the one that fits your life the best. This link gets you to the webpage where you can begin the process. If you haven’t already, create an account and sign in. My first step is to have the software retrieve the information about my current plan and what changes they are making for 2025. Your current plan should also be sending you access to their information on 2025 changes. After reviewing those changes, I then look at other plan offerings in my area, as well as the prescription drug information - comparing availability and cost. As you do these reviews, think about any future health issues that might present themselves in 2025.
The important thing to remember is you can’t have too much information and don’t be afraid to ask questions by phone, text, chat, or email - whatever medium you feel most comfortable. The decisions you make during open enrollment can make a big difference in both access and cost for 2025.
Best, Thair