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Medicare Open Enrollment Starts Soon; Here’s What You Need to Know

Cypress Wealth Services

August 2021

Getting what you need out of Medicare is really important, especially as you ease into retirement. Having access to the right Medicare plan could mean that you have more money in your pocket to spend on activities or goals that you want to take full advantage of during your later years.

That’s why you should reassess your Medicare coverage every year before or during open enrollment to ensure that your plan covers your medical needs, allowing you access to the best medical care for the best price. 

Who Does Medicare Open Enrollment Affect?

Medicare open enrollment is for people who are already a part of the Medicare system. Even if you have only signed up for Parts A and B, you can still take advantage of open enrollment.

If you have not yet enrolled in Medicare, then open enrollment does not apply to 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.

When Is Medicare Open Enrollment?

Open enrollment for existing Medicare participants, though, has nothing to do with your birthday. It is at the same time every year, and everyone currently enrolled can take advantage of it, even if you only began Medicare the month before. This year, open enrollment goes from Oct. 15, 2021, to Dec. 7, 2021. The decisions you make during that period will affect your 2022 medical coverage.

Starting in 2019 and continuing into subsequent years, there is a new open enrollment period for Medicare Advantage plans only from January 1 to March 31.(*1)  This open enrollment is more restrictive than the fall Medicare open enrollment. Also, it only applies to the Medicare Advantage plans, so any other changes need to be made during the Medicare open enrollment that is fast approaching.

What Is Medicare Open Enrollment For?

Medicare open enrollment is the annual opportunity for all participants to change their Medicare coverage. Here are some of the changes you can make during open enrollment:

  • Enroll in Medicare Part C (Medicare Advantage) for the first time. If you currently have Parts A and B (Original Medicare), you can switch to Part C. Part C is contracted by outside companies and offers the same coverage as Original Medicare but can include even more services.
  • Switch back to Original Medicare (Parts A and B) if you currently have Medicare Advantage (Part C).
  • Change your current Part C plan to a different Medicare Advantage plan.
  • Enroll in or drop Part D prescription drug coverage.
  • Change your current Part D plan to a different prescription drug coverage Part D plan.

What Will Open Enrollment Changes Cost?

The costs of Parts C and D vary depending on the plan you choose. If you’re looking at switching from a Part C plan to Original Medicare, then the costs will depend upon your income and how long you worked and paid into the Medicare system.

The standard premium for Medicare Part B is $148.50 for 2021. However, if your income is over $88,000 for a single person or $176,000 for a couple, then your premium will be higher. The range for high-income earners is from $297 to $504.90.

Medicare Part A is free if you or your spouse paid into Medicare for at least 10 years or 40 quarters. If you only have 30-39 quarters, it costs $259. The premium for less than 30 quarters is $471. (*2)

Overwhelmed by Open Enrollment? We Can Help.

A recent study conducted by the Kaiser Family Foundation found that only 6% to 13%, a relatively small percentage of Medicare enrollees, switched their Medicare Part D in any single year between 2006 and 2016. And nearly half of enrollees “rarely or never” review their Medicare plans during that same time period. According to that same study, nearly half of those surveyed said it was too difficult to compare plans. (*3)

While it is true that choosing the right Medicare plan can be a complicated endeavor, it is also true that choosing the wrong plan could negatively impact your wealth management strategy. Simply put, taking your time and shopping around for the right plan will benefit your health and medical needs while also benefiting your pocketbook. The right financial advisor can help you reassess which plan will work for you. Call our office at 866.888.6563 or contact one of our offices today.

 

About Cypress Wealth Services

Cypress Wealth Services is an independent RIA firm providing financial planning and investment management to high net worth individuals, families, business owners, and institutions. Cypress Wealth Services comprises professionals with diverse backgrounds and extensive experience and qualifications. Cypress Wealth Services is uniquely qualified to serve a broad range of client needs, and their experience and expertise act as a foundation for their client service process. The firm uses The Second Growth, which focuses on efficiently protecting, growing, and transferring to their loved ones the wealth and legacy a person has already built. With financial advisors in Palm Desert, CA, Tustin, CA, and Anchorage, AK, the firm serves clients across the country in Wealth Management Services, Fiduciary Services, 401(k) Design and Management, Investment Reporting Services, Financial and Retirement Planning, and more. For more information, visit www.CypressWS.com or call 760.834.7250.

 

(*1)-  https://www.ehealthinsurance.com/medicare/advantage-all/new-medicare-advantage-open-enrollment-period-for-2019