Ask the Medicare Specialist

Question: Why does there have to be an "Annual Election Period" to make changes to our Medicare insurance? Why can't we do that all year long? Lastly can you tell us what you're seeing so far and what you feel is important for those of us on Medicare to be aware of for 2025?

Answer: There's a couple of reasons for the limited Annual Election Period (AEP) and not allowing people to change plans all year long like we can with auto and homeowner's insurance. One is so people don't go from company to company to get more dental, OTC, or other "extras." What also would happen, and what we would probably advise our clients to do, is choose plans with a lower premium but higher hospital and other co-pays, but if the need for a knee replacement or other more costly service would arise, temporarily move to a plan with a higher premium that has lower hospital and physical therapy co-pays. Then, once released from care, move back to the cheaper plan. If this were allowable and commonplace, it would result in more losses/less profits for the insurance companies. Ultimately it would cause premiums to rise, as well as the overall quality and value of plans and benefits to be reduced for everyone. Secondly, there's enough nefariousness from agents who want to move those on Medicare from plan to plan for the sake of a commission. It would be chaos if people could switch all year round.

What we're seeing is Medicare Advantage getting more convoluted and confusing here in Western Pennsylvania because there are now eight companies in our market and over 100 choices in plans with benefits varying significantly, even within the same company.

The biggest development for 2025, and I don't think there's been a column in the last two months where I didn't mention it, are the changes in prescription drug coverage for many on Medicare Advantage Plans. For the first time ever some of the most popular plans in the region will have a deductible, up to $590 that people will have to pay up front, on commonly prescribed Tier 3 medications, as well as a new coinsurance model where people will be charged a percentage of the drug's retail price. What this means is instead of paying a flat co-pay of under $50 for a 30-day supply, the cost of could be $100 to $250. People taking the same exact medications(s) will spend between $0 to $2,000 in 2025 depending on what company or plan they choose. The cost of Tier 3 drugs between plans and companies should be one of the most important considerations when making a decision to remain on one's current plan or move to another.

There's another significant development for those on expensive diabetes meds. Select plans will be offering the following medications at no cost in 2025: Jardiance, Ozempic, Tradjenta, Trulicity, Victoza, Mounjaro, Farxiga, Rybelsus, Synjardy, Truardy, Symlinpen, Jentadueto, Glyxambi and Xigardo. We've had multiple married couples in the first week of AEP who will save $3,000 to $3,500 on their drugs in 2025 by changing to one of these plans.

Advantage Plan companies love to advertise $0 premium plans and they've historically been the most popular. However, in 2025, almost all plans in our market with a $0 premium that also provide Part D drug coverage will have hospital co-pays of up to $2000 for a seven day stay or longer. I don't think enough people are aware how expensive a hospitalization can be or that multiple admissions result in multiple charges. We always advise our Advantage Plan clients to choose an HMO or PPO that has a fair and flat per stay co-pay regardless of how long the admittance. It's worth spending a few extra dollars per month in premium to avoid the possibility of paying thousands for a hospital bill.

This is not an AEP where everyone is simply fine to renew their plan. You need a review and a recommendation. We provide that each year for every one of our clients. If you have a broker you like, trust, and worked with in the past, make sure he or she advises what's best for 2025. If not, reach out to us here at The Health Insurance Store and we can make sure you choose the plan with the best fit for your individual health care needs. Which brings us to a related development. If you're currently on an Advantage Plan, originally got it though another agent or broker, and would like to become our client without changing plans, one of the most popular companies will now let you designate The Health Insurance Store as your "Agent of Record," which allows us to contact the insurance company on your behalf if issues arise. You can then also lean on us for our support and advocacy services if there are ever problems with erroneous bills, claim denials, expensive drugs costs, etc.

As far as Supplements, so many people are still paying too much for plans that don't offer a return in value or benefits. As I wrote about in the last column, almost no one should be on Plans C, G, or F. C and F are antiquated and exorbitantly priced while Plan G is going up more than twice as fast as Plan N. Those who've been on G for just five to 10 years are already paying $70 to $200 more per month than N. G will become even more costly and possibly unaffordable for many soon. If you want to keep a Supplement for the long haul, N is the best way to accomplish that. The only difference between G and N is two small co-pays for doctor visits and a trip to the Emergency Room of $20 and $50. And the $20 co-pay DOES NOT apply to services such as bloodwork, X-Rays, physical therapy, etc. There is no reason to spend $800 to $2,500 more pre year to eliminate these two small bills.

If you have any questions regarding today's column or any other Medicare related topic, give us a call or email me personally at [email protected].

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