It's that time again.
No, we're not talking about the return of pumpkin-spice-flavored everything, though that's definitely happening, too. We're talking about Medicare, the federal health insurance program for seniors.
Oct. 15 marks the start of the annual open enrollment period for Medicare plans. The window, one of the few times enrollees can change their coverage, runs through Dec. 7.
While most enrollees stick with what they've got, shopping around can save you money. A new analysis from the nonprofit Kaiser Family Foundation found enrollees who switched Medicare Advantage plans in 2014 saved $15.87 per month in premiums on average.
That's not the only reason to consider something different.
Medicare Advantage plans often make changes to their benefits. That is, the prescription medication you rely on may no longer be covered under the formulary. Your doctors may no longer be part of the network.
With an alphabet soup of programs — and a plethora of options — choosing a new plan can be intimidating and confusing. The Tampa Bay Times is here to help.
Our special issue of LifeTimes includes charts of available drug and Medicare Advantage plans, as well as some advice on how to choose the best plan for your circumstances. Let's start with a refresher on Original Medicare.
How Medicare works
• Part A covers inpatient hospital care, nursing home care, hospice and a few other services. You get this automatically, and with no premium.
• Part B covers outpatient hospital care, doctor bills, physical therapy and more services. Part B is optional and costs most people a monthly premium that is usually deducted from their Social Security check. Unless you are still working and included on an employer's health plan, you should probably sign up for Part B when you first become eligible for Medicare, no matter how healthy you are. Otherwise, you will face a stiff penalty when you do need this coverage. Even if you choose a private Medicare HMO for your coverage, you have to sign up for Part B.
• Part D covers prescription drugs. You buy these plans from private insurance companies for an average premium of $32.50 a month. The plan then defrays the cost of your medications. These plans have deductibles and copayments but are subsidized by taxpayers and usually a very good deal.
• Note: Part A and Part B services under Original Medicare come with deductibles and copays. Many people cover these costs by buying private Medicare supplement policies, also known as Medigap. This is not required and premiums tend to be high, but if you suffer a catastrophic illness, Medicare supplement policies will pay off.
Also, a few Medicare supplement policies offer coverage outside the country, which Original Medicare does not. People who travel abroad might consider one of these plans.
There's an alternative: Medicare Advantage health plans. This is privately managed care — usually an HMO (Health Maintenance Organization) or PPO (Preferred Provider Organization) — in which you often must choose your medical providers from a plan's predetermined list.
Medicare Advantage plans are subsidized by taxpayers. And, if you are satisfied with the doctors and hospitals in their network, they usually turn out to be less expensive than Original Medicare, though not always.
Most Advantage plans also provide drug coverage, so you do not need a separate Part D drug plan.
How do I get a Medicare Advantage plan?
You must sign up for Part B Medicare to qualify for a Medicare Advantage plan. Some insurance companies will pay all, or part, of your premium. Some plans offer vision, hearing and dental benefits that original Medicare does not, though sometimes these benefits are minimal.
The tradeoff is that Original Medicare lets you pick any doctor or hospital in the country, whereas Advantage plans often restrict you to a network or charge a hefty fee if you get service outside the network. If access to a particular hospital or doctor is important to you, make sure they are on the Advantage plan you are considering.
Also, plans can and do drop providers from their networks. Advantage plans always carry a risk that you can end up losing the doctor you want to see. Worse, some Advantage plans have gone bankrupt or have been shut down by authorities midyear, sending you and thousands of others scrambling for new doctors. If that happens, Medicare will give you a chance to find a new plan.
What's more, some Advantage plans skimp on coverage for hospital visits, skilled nursing care or other services. Pay close attention to the benefits offered when picking a plan. Don't just choose the plan with the cheapest premium.
Many Advantage plans include drug coverage. The charts in this section list only the Advantage plans that cover drugs.
Unless you already have prescription drug coverage through the Department of Veterans Affairs, the union you belong to, an employer or through some other source, it's important to get some kind of drug coverage — either a Part D drug plan if you are on Original Medicare or a Medicare Advantage plan that covers drugs.
You should get coverage even if you don't use any prescription drugs.
It doesn't cost much. Most people can buy a Part D plan for less than $400 a year, and many Advantage plans offer drug coverage without any extra charge. If you get sick and need expensive drugs, you will be happy you bought coverage.
More important, if you decline drug coverage now, the government will impose a stiff penalty every year if you try to sign up.
The charts in this section compare costs based on a hypothetical person in good health. But that is just a general guide. Your costs could vary widely depending on the drugs you take and services you use.
The only good way to compare costs tailored to your circumstances is with Medicare's online Plan Finder (medicare.gov/find-a-plan), which allows you to factor in your health conditions and the drugs you take. (An accompanying story provides step-by-step details on how to use the Plan Finder.)
Mind the gap
You reach the coverage gap, also known as the "donut hole," when the total cost of all your drugs for the year reaches $3,700, an amount set by Congress. That amount is the total paid — by the insurance company and your deductibles and copays. For example, if your plan pays $600 a month for your drugs, but charges you only $100, you will hit the coverage gap in less than six months because the total paid will have reached $3,700.
Then, the onus is on you to pay until your out-of-pocket drug expenses for the year reach $4,950 and you are eligible for "catastrophic" coverage. At that point you are out of the "gap" and only responsible for a small coinsurance amount or copayment for covered drugs for the rest of the year.
• Note: You will get a discount on brand-name and generic prescription drugs while you are in the coverage gap.
• Another note: Some plans offer limited coverage in the gap.
Medicare's Extra Help program, for people with limited income and resources, can reduce out-of-pocket costs for a Part D drug plan or a Medicare Advantage plan that covers drugs.
To qualify, a person must have an income of less than $17,820 and liquid assets of less than $13,640. A married couple qualify with an income of less than $24,030 and assets of less than $27,250. (Liquid assets include stocks, cash and savings accounts. They do not include your home or car.)
If you think you qualify, contact the Social Security Administration toll-free at 1-800-772-1213 or apply online at socialsecurity.gov.
The federal government also offers Medicare Savings Programs for low-income people. The lower your income, the more you stand to gain.
For all these programs — called QI, QMB and SLMB — your liquid assets cannot exceed $7,280 for a single person or $10,930 for a married couple.
The monthly income limits are:
• QI: $1,357 for a single person or $1,823 for a married couple. This program pays your Part B premium but has a fixed budget. When its money is exhausted, nobody else can qualify that year.
• QMB: $1,010 for a single person or $1,355 for a married couple. This program pays your Part B premium and Medicare's copayments and deductibles.
• SLMB: $1,208 for a single person or $1,622 for a married couple. This program pays your Part B premium and has no fixed budget. Everyone who qualifies can get the benefit.
• Note: To see if you qualify or to find out how to apply, call Florida's Medicaid office toll-free at 1-866-762-2237, apply online at socialsecurity.gov/i1020 or call Social Security toll-free at 1-800-772-1213. Ask for information about Medicare Savings Programs.
Florida's SHINE program is made up of volunteers who can navigate Medicare's website and help find the plan best suited to you. Call the Florida Senior Hotline toll-free at 1-800-963-5337.
• Note: Before you contact SHINE, make a list of all your drugs, dosages and monthly usage.
• Another note: You also can get help from Medicare by calling toll-free 1-800-633-4227, but the government workers there generally have less time to spend with you than SHINE volunteers do.
Contact Kathleen McGrory at email@example.com or (727) 893-8330. Follow @kmcgrory.