Autumn marks the beginning of open enrollment season, that annual rite where employees with health care coverage at work get to choose their medical benefits for the coming year.
But there's another side of open enrollment: Medicare coverage, which is primarily for retirees ages 65 and older. If that's you, your open enrollment season started Oct. 15 and runs through Dec. 7.
As everyone knows, health care choices can be confusing. To get some clarity, we talked with Nancy Metcalf, a health care specialist with Consumer Reports based in Yonkers, N.Y., who has been writing, blogging and answering online questions about Medicare and health care coverage for the past five years.
QUESTION: You've cited studies that say one in four Americans don't realize they can switch their Medicare plan every year. Why is that?
ANSWER: People are creatures of habit. They don't check every year and realize they can switch. But prices can creep up -- prescription drug costs, co-pays, co-insurance. Or your doctor or hospital can leave your covered group. Chances are your plan won't be that different (every year), but it can still pay to check.
Q: What are the best ways to figure out Medicare choices?
A: It can be really confusing. I've been doing this intensively for five years and every day I get questions I don't have answers to. It's like learning a foreign language. That's why consumers should use state health insurance assistance programs. Every state has one. You can call an 800 number and get free Medicare counseling.
You can also go to Medicare.gov, the federal consumer website, which has free online comparisons and ratings of various Medicare plans. Based on your ZIP code, you can compare the choices available to you.
Q: Where do Medigap policies come in?
A: Medicare does not cover everything. You still have to pay out of pocket. This year, the Part A deductible is $1,156 if you go in the hospital. For Part B, there's a $140 deductible, plus 20 percent of everything over that. If you have outpatient therapy for cancer, it could be $10,000 a month, so your share would be $2,000. It can really add up to big money.
One way to avoid that is to get a Medigap plan, which pays what Medicare doesn't. It keeps you from that financial vulnerability. They're sold by private insurers all over the country and come in different "flavors," depending on what you want.
If you want minimum billing hassles and automatic payments to your insurer, go on original Medicare with a Medigap plan. After Medicare pays its portion, they send the difference on to Medigap that covers the remainder.
Q: So who should choose a Medicare Advantage plan?
A: You can see why seniors are completely baffled.
The advantage of Medicare Advantage plans is a lower premium up front. Many have no premiums whatsoever or only $25 a month. But they come with co-pays, deductibles, co-insurance. The annual out-of-pocket fees can range from $3,000 to $6,000, then coverage kicks in.
Unlike original Medicare, they are almost all HMOs, so each plan has a provider network of doctors. That means if your doctor isn't in your network, your treatment will not be covered.
Q: How do people choose between Medicare (with a Medigap supplement) or a Medicare Advantage plan?
A: There's no right answer. ... You can compare all the plans and their ratings, based on patient satisfaction, preventive care, chronic illness, etc., using the "Medicare Plan Finder" at Medicare.gov.
Q: What should consumers know about buying Part D prescription drug coverage?
A: Part D started in 2006 and is only purchased through private insurance companies. The average premium costs about $30 a month. Many, many companies offer them.
But your out-of-pocket costs can change dramatically. Take a heartburn drug like Nexium. It might cost $250 in one plan and $20 in another, depending on what kind of arrangement the (health plan) provider has with various drug manufacturers.
Q: What if you figure you're healthy and don't want to pay for Part D?
A: There's a penalty for both Part B and Part D, if you don't sign up when you first become eligible (age 65) It's a mistake a lot of people make: "I'm healthy, I do yoga, I eat right, I don't take any medications."
Fine, except you get something serious like a cancer or an autoimmune disease and need a drug that's $2,000 a month. You'd have to wait until the next open enrollment period to sign up.
If you delay, you'll be assessed penalties on your monthly premium for every month that you could have been signed up.
Q: What are the biggest mistakes people make in selecting their Medicare plans?
A: This time of year, people are getting an inundation of promotional mail from companies saying "Buy My Plan." It's only $30 a month; it's so easy to sign up.
But people often make two mistakes: They might buy a Medicare Advantage plan and think it's a Medigap supplemental plan.
Or if they're not comparing, they'll sign up for a not-very-good plan that is too expensive, has a lower quality rating or their doctor is not on it.