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Top 10 Medicare Mistakes

Common errors can be costly, but here's how to avoid them

Mistake No. 7:
Misunderstanding enrollment periods

You may have read about "open enrollment" and gotten the idea that this is the only time you can sign up for Medicare. Not true! In Medicare, open enrollment (Oct. 15 to Dec. 7 each year) is only for people who are already in the program and want to change their coverage for the following year. If you're coming into Medicare for the first time, you get your own enrollment period — either around the time you turn 65, or throughout the time you have health coverage from your own or your spouse's employment and for up to eight months after it ends. So if you miss your personal deadlines because you're waiting for open enrollment, you risk delayed coverage and permanent late penalties. (Note: Different enrollment periods apply in some other situations, including when people qualify for Medicare due to disability.)

Mistake No. 8:
Being too late to buy Medigap with full protections

Medigap supplemental insurance is extra coverage you can choose to buy privately to cover some or most of your out-of-pocket expenses in traditional Medicare, such as deductibles and copays. But to get the full federal protections, you need to buy it at the right time and be 65 or older. (See Choosing a Medigap Policy.)

If you buy a Medigap policy within six months of enrolling in Part B or in a few other specific circumstances, Medigap insurers can't deny you coverage or charge higher premiums based on your current health or preexisting medical conditions. Outside of those time frames, they can do both. (Note that people under 65 don't get this federal umbrella, though some states provide similar protections.)

Mistake No. 9:
Failing to read your Annual Notice of Change

This important document comes in the mail each September if you're enrolled in a Medicare Advantage plan (HMO or PPO) or a Part D prescription drug plan. It specifies what changes the plan will make in its costs and coverage for the following year. You can then compare it with other plans during open enrollment (Oct. 15 to Dec. 7) and switch if you want. Failing to read the notice can result in nasty shocks on Jan. 1 if you stay with a plan that hikes its charges.

Mistake No. 10:
Not realizing that you may qualify for help to lower your costs

Medicare comes with many expenses — premiums, deductibles, copays — that many people find hard to pay. So if your income is limited, be sure to check out two programs that can reduce those costs if you qualify. Under a Medicare Savings Program, your state pays the Part B premiums and maybe other expenses. Under the federal Extra Help program, you get low-cost Part D prescription drug coverage.

Patricia Barry writes the AARP Ask Ms. Medicare column and is the author of  Medicare for Dummies.

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