This is a topic that confuses many folks so let’s clear things up!
By David S. Edge
October 15 – December 7 is the “Annual Election Period” (AEP) or frequently incorrectly called the Open Enrollment Period. The Annual Election Period (AEP) is the once a year time where folks can change their Part D drug plan or their Medicare Advantage Plan including prescriptions. This is the time October 15 through December 7, where you can change from one Prescription Drug Plan to another, one Medicare Advantage Plan to another, leave the Prescription Drug Plan, or leave the Medicare Advantage Plan and go back to Original Medicare and select a Prescription Drug Plan. Changing plans once you are already on a Medicare health plan is complicated. Ask for professional help!
AEP is frequently and INCORRECTLY referred to as the “Open Enrollment Period”. It is not. That “period” comes later in the story… However, once this AEP period has passed, there are more restrictions on what you can do, and when you can change plans.
Under certain conditions, you can change Medicare Advantage Plans due to a “Special Election”. An example of this is when you are on a Medicare Advantage Plan and move out of your service area. You have 60 days to pick a new plan in your new address. Service areas can vary by simply moving from one county to another in the same state you reside or, even if your moving state to state. There are other times you can qualify such as “Loss of Employer coverage”. See your advisor to get details on the ways you may qualify or not.
New for 2019, is the January 1 through March 31 Open Enrollment Period for Medicare Advantage Plans only.
In previous years, a period from January 1 through February 14, was called the Annual Disenrollment Period. It allowed you to leave a Medicare Advantage Plan and go back to Original Medicare and select a Part D Prescription Drug Plan.
The new period is when you’ve changed your mind and want to drop your Advantage Plan and go back to Original Medicare and select a Part D drug plan or you need to make a change from one Medicare Advantage Plan to another. This can be used if a doctor suddenly left a network or a drug was no longer covered by your current Medicare Advantage Plan. This period does not replace AEP. This period the plan that was in their favor and they were locked in for the rest of the year.
At age 65 you are eligible for Medicare. This is your Initial Enrollment Period (IEP) and you have 90 days before the month of your birth, the month of your birth, and 90 days after the month of your birth to enroll with no penalties. So that’s a 7- month period surrounding your birth month to enroll in your Medicare A & B and select a health and drug plan.
“When originally enrolling in Medicare at age 65, you will only be automatically enrolled if you are already collecting your Social Security Benefit. If you are not taking your Social Security benefit, you will need to enroll in Medicare A & B manually. Enroll online at www.Medicare.gov or call 1-800-772-1213 to enroll over the phone. You can also visit your local Social Security office to enroll in person.”
Medicare plans for most folks typically start the first day of the month of your birth, not your birthday. If you enroll in Medicare A & B in later years, your coverage will start on the 1st of the month you are effective for your coverage. For example, this occurs if you are going to work past age 65 and have an employer health plan that is qualified. Employer plan must have 20+ employees on the plan and be “Creditable Coverage” which basically means the employer health plan is equally as good as Medicare coverage. If the employer health plan does not meet these two requirements, you must enroll in Medicare A&B or be exposed to a penalty. You can keep your plan at work and you do not have to sign up for Medicare. In later years when you decide to separate or retire from your employer and are losing your employer health plan, you can enroll in Medicare at that time. No harm, no foul, no penalties.
January 1 through March 31 is also the General Enrollment Period. You enroll during this period for your Medicare A & B, but it will not be effective until July 1 that same year. You will select a medical plan the 90 days before July 1 (April through June). This period is for folks who, for whatever reason, missed their Initial Enrollment Period. Careful! When you miss your IEP, you may qualify for a penalty that you pay monthly for the rest of your life!