Carla Fried: This Thanksgiving, have a chat with your loved ones about Medicare

Medicare is typically a set-it-and-forget-it rite of passage at age 65. After enrolling and choosing supplementary coverage, the tendency is to just let it auto-renew every year.

A study by the Kaiser Family Foundation found that barely one in 10 Medicare enrollees who paid for a supplementary policy to cover prescription drug costs made a switch. But among those who did bother to shop around, half were able to reduce their annual premium by at least 5%.

An analysis by Q1Medicare of supplemental prescription drug policies (called Medicare Part D plans) hints at good news in 2020: Average monthly premiums will drop by more than 10%. But that's for all plans that are offered; when you drill down into the plans that people currently own, the estimate is that nearly six in 10 Part D enrollees will face a premium increase in 2020, around $8 a month if they sit tight.

That's just the premium. Copays and coinsurance costs change every year. Not just for supplemental drug coverage, but also for the out-of-pocket costs an enrollee pays for doctor visits, hospitalization and tests.

While reviewing coverage and comparison shopping can lead to cost savings, the maddening complexity can make it a non-starter for many enrollees. That's where adult children and grandchildren can help.

Between Oct. 15 and Dec. 7, current Medicare enrollees can make changes to their supplemental coverage. If you're gathering for Thanksgiving, carve out a few hours and your loved-one could save hundreds, if not thousands of dollars.

Here's a game plan:

_Comparison shop online. The Medicare Plan Finder will pull up plans offered in your zip code. If an enrollee registers (it's free) the finder will pull up their current coverage, including medications, making comparison shopping even easier. The tool has recently been revamped to be a bit more consumer friendly. It's still a work in progress. For example, as of early October, users couldn't compare maximum annual out-of-pocket costs.

_Get help. Each state offers a team of counselors who help enrollees sort through their options; the service is free. Contact your state's health insurance assistance program to schedule an appointment. The Medicare Rights Center, a nonprofit consumer advocacy organization, has online tools and an 800-help line to help families navigate Medicare decisions.

OK, now a quick cheat sheet for relatives not yet up to speed on Medicare basics:

There are two main ways to have coverage.

1. Original Medicare + Medigap/Medicare Part D. Original Medicare has two elements. Medicare Part A covers in-hospital care and limited skilled nursing care. There is typically no monthly premium, though there is an annual deductible ($1,364 in 2019) and co-insurance costs for hospitalization of more than 60 days. Part B covers doctors' visits, procedures, tests and equipment. The standard monthly premium is $135.50 and is typically deducted from Social Security benefits, and enrollees typically pay 20% of their bills out of pocket. (Higher income households pay a higher premium.)

To pay for those out-of-pocket costs not covered by Parts A and B, enrollees typically rely on a supplemental policy offered through a former employer, or purchase their own Medigap supplemental policy from a private insurer. An additional supplemental policy, called Medicare Part D, provides coverage for prescription drug costs.

A key benefit of Original Medicare is the ability to work with any doctor who accepts Medicare patients. These plans do not provide eye or dental care.

2. Medicare Advantage: This is an all-in-one package offered by private insurers that covers Medicare Part A and B and typically includes drug coverage as well. Medicare Advantage Plans can also provide eye and dental care. Medicare Advantage plans typically operate like HMOS. Enrollees are limited to a network of doctors who work with the plan and must get preapproval for care.

About two-thirds of enrollees choose Original Medicare, though Medicare Advantage has been growing.

From Oct. 7 to Dec. 15, enrollees can switch from one type of coverage to the other. Or they can stick with their basic choice between Original Medicare or Medicare Advantage, but change their plans. Here's how:

_Read the fine print for 2020 changes. Every enrollee will have received in the mail an explanation of what their supplemental or Medicare Advantage policies will cover for 2020. You can also find it online. That's a good starting point to use for comparison.

_Confirm doctors. If specific doctors are a priority, be sure to check with their staff that they will continue to accept your plan.

_Make sure there is supplemental coverage. Under Original Medicare there is no maximum out-of-pocket cost; that's where an employer supplemental retirement policy or Medigap policy is crucial financial protection. Medicare Advantage also helps covers the out-of-pocket exposure. (For low-income households, Medicaid will provide coverage.) But according to a Kaiser Family Foundation study, nearly one in five Medicare enrollees has no supplemental coverage.

_Check the maximum out of-pocket cost for 2020. Whether you have a Medigap supplemental coverage or rely on Medicare Advantage, the real budget-buster is copayment or coinsurance costs in the event the insured has an acute illness or requires ongoing care. Annual out-of-pocket maximums can be more than $6,000. One analysis of Medicare Advantage plans reports that more than 75% of plans had a max out-of-pocket of more than $3,400. You can shop for policies that may charge a higher monthly premium in return for a lower maximum out of pocket.

_Shop for the cheapest prescription drug coverage. Changing doctors is, admittedly, a heavy lift. But changing the plan for your meds is not nearly as intrusive and can save hundreds of dollars a year. The basic premium is not the biggest issue - the average is about $40 a month – but rather what additional copayment and coinsurance the enrollee will owe. And this can change every year.

Insurers place drugs in different "tiers" and each tier comes with its own pricing plan. Drugs can be moved from one tier to another each year. Medicare Part D plans offered within the same zip code can have wildly different charges for the same medication.

It's gotten to the point that even generics now come in two tiers: Preferred generics are cheaper than mere generics. A preferred generic drug will typically have a copay of less than $6. But if it's just a generic not on the preferred list, about two-thirds of Medicare Advantage plans charge a copay of $10 to $20. Once you venture into name brands or higher-cost drugs, the expenses can become onerous.

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