Boomers typically like choices, but you may feel overwhelmed by those in Medicare. Here's a quick overview of your options:
Traditional Medicare or Medicare Advantage?
When you enroll in Medicare for the first time, you're automatically in the "traditional" or "original" program that's been in place since 1966. If you prefer to join a Medicare Advantage plan, you can do so right away or during open enrollment (Oct. 15 to Dec. 7) in any year.
- Traditional Medicare covers Parts A and B, and you pay standard rates for services, regardless of where you live. You can go to any doctor, hospital or other provider that accepts Medicare patients anywhere in the country. You can add Part D coverage by enrolling in a private "stand-alone" drug plan for an additional premium. You can buy separate medigap insurance (See "Where Can I Get Help?") to cover some or most of the out-of-pocket costs of Parts A and B.
- Medicare Advantage (MA) offers an alternative way of receiving your benefits through local or regional private plans, which are most often health maintenance organizations (HMOs) or preferred provider organizations (PPOs). Each plan must include everything covered by traditional Medicare, but may offer more benefits and/or lower copays. Most plans charge a monthly premium (in addition to the Part B premium), and most include Part D drug coverage. Your choice of doctors and other providers may be restricted to those in the plan's network. Each plan can, each calendar year, change its premiums, its extra benefits and its copays, or withdraw from Medicare. Each plan has an annual limit on out-of-pocket costs.
For more information on the main differences between the traditional program and Medicare Advantage, and between different types of MA plans, see related article, "Medicare's Private Plans."
How do I choose a Medicare Advantage plan?
Almost everyone in Medicare has access to at least one MA plan, and in many areas there are dozens, each with its own mix of costs, benefits and conditions. Your mailbox may be stuffed with their ads. But to compare plans objectively and free of sales pressure, use the official Medicare website, which lists details of every plan in your area, including a measure of the quality of its care — or call the Medicare help line for assistance. You can enroll in the plan you choose through Medicare or directly through the insurance company.
How do I choose a Part D plan?
If you need to add prescription drug coverage to traditional Medicare, you also will be faced with dozens of different plans. You can compare these in the same way you compare Medicare Advantage plans. If you don't currently take any drugs, you may want to choose the plan with the lowest premium to get coverage at the least cost. Otherwise, it's best to choose a plan according to the specific drugs you take, because plans charge widely varying copays even for the same drug. The plan finder on Medicare's website automatically does the math to find your best deal. You can enroll through Medicare or directly with the plan.
What if I change my mind?
You will not be locked into any plan permanently. You can switch between the different options at certain times of the year or in specific circumstances. For full details, see related article "Different Medicare Enrollment Periods."
WHY IS MEDICARE SO CONFUSING?
The program has separate rules for people in different situations and a range of choices that require everyone to make personal and timely enrollment decisions. From time to time over Medicare's 45-year history, Congress has added more benefits and options, each with its own new set of rules. Although every piece has an inner logic, Medicare now resembles a crazy quilt that bewilders many enrollees — but it still gives the comfort of guaranteed health coverage to more than 46.5 million Americans.