For most seniors, Medicare is a lifesaver. Unfortunately, it’s full of deadlines, choices, and fine print that can trip you up.
A single mistake can lead to higher premiums, missed coverage, or even penalties which can set you back for years.
To help you stay on track, here are seven common Medicare mistakes and how to avoid them.
Mistake #1: You Missed Your Initial Enrollment Window
If you already receive Social Security benefits, you’ll be automatically enrolled for Medicare parts A and B at the start of your 65th birthday month.
However, most people wait until they are 67 (or even 70) to file for Social Security to maximize their monthly benefits. If you’re in this group, you need to sign up for Medicare during your Initial Enrollment period (IEP).
This seven-month window starts three months before you 65th birthday month and ends three months after the end of that month.
For example: if you turn 65 on January 1st (Happy New Year!), your IEP begins in the previous October and runs through the following April.
If you don’t sign up during this time window, you could be hit with penalties:
- If you must pay a Part A premium (meaning you didn’t pay Medicare taxes for at least 10 years), you’ll pay an extra 10% for twice as many years as you delayed signing up
- For Part B, you’ll pay an additional 10% on your part B premium for the rest of your life
- If you delay signing up for part D (prescription coverage), your premium will be increased by 1% of the national base premium (currently $34.70) for each month you don’t have qualifying prescription coverage…permanently
The bottom line? Sign up BEFORE you turn 65. Better yet, make an appointment with a qualified Medicare agent who can make sure you sign up on time.
Mistake #2. You Didn’t Budget for Medicare Costs
Many people think Medicare covers everything at no cost. Unfortunately, that’s not true.
Most people don’t have to pay a premium for Part A (hospital) coverage. However, you’ll usually pay a monthly premium for Part B (doctor visits and outpatient care).
There are also copayments, deductibles, and gaps in coverage (like the 20% that Part B doesn’t cover). Plus, traditional Medicare doesn’t cover prescription medicines.
These additional costs can add up. Know what you’ll have to pay ahead of time, and plan accordingly.
Mistake #3. You Only Signed Up for Original Medicare
Original Medicare (parts A and B) lets you choose any provider who accepts Medicare.
Unfortunately, part B only covers 80% of office and outpatient costs. And it doesn’t cover prescriptions.
There are insurance options to cover these additional expenses:
If you like the flexibility of Original Medicare, you can add a Medicare Supplement (a.k.a. Medigap) policy and Part D prescription coverage to help cover the additional expenses.
Medicare Advantage plans (also known as Medicare Part C) are another option.
They provide the benefits of both parts A and B in a single policy. Medicare Advantage plans may also provide additional benefits like prescription coverage, dental, vision, and even gym memberships in some cases.
However, Medicare Advantage plans usually have limited provider networks (like an HMO or PPO plan).
Compare your options:
- If you prefer flexibility to choose your own doctors, a Medigap plan with Original Medicare might be best.
- If you want extra benefits like dental, vision, or fitness programs, a Medicare Advantage plan could be better.
Mistake #4. You Chose a Plan Based Only on Premiums
Low premiums can be attractive, but they don’t tell the whole story.
A plan with a low premium might have higher deductibles, copays, or a limited provider network.
Always pay attention to the details, not just the monthly cost. Look at things like deductibles, copayments, drug coverage, and whether your doctors and hospitals are in-network.
Mistake #5. You Don’t Review Your Coverage Every Year
Your health needs can change from year to year. So can Medicare plans. Yet many people auto-renew their plans without checking if it’s still the best fit.
Use Medicare’s Annual Open Enrollment Period (October 15 – December 7) to review your current plan, compare new options, and switch if needed.
Get Help to Avoid Medicare Mistakes
Medicare is a powerful benefit, but it’s not automatic or one-size-fits-all. And it can be hard to make the best decisions without help.
As a certified Medicare broker, I can help you avoid these and other Medicare mistakes.
Do you need help to navigate the Medicare maze? Give me a call at (832) 773-7981, email me at scott.goodell@ghstx.com, or use my contact form.