How Does Annual Medicare Renewal Work?

The simple answer is, each year there is an enrollment period. Medicare beneficiaries may keep the plan they have or take the opportunity to change their plan if they choose.

With his parents about to turn 65, our friend, Gary, has been learning a lot about Medicare. Recently he was looking into what needs to be done to renew it every year. He found out it's not quite the same as renewing a magazine subscription or his driver's license, when he has that "handsome" portrait taken.

Medicare Annual Coordinated Election Period

Gary learned that something called the Medicare Annual Coordinated Election Period takes place each year between November 15 and December 31. That is when you can change your prescription drug plan, enroll in or switch your Medicare Advantage plan, or return to traditional Medicare from a Medicare Advantage plan.

Medicare Advantage plans allow you to get Medicare-covered services through private insurance companies. These plans may cost a little more than traditional Medicare Part B, but they usually include extra benefits and services, and they often have lower co-pays and deductibles.

It's a smart idea to evaluate your needs before the enrollment deadline. If you don't want to make any changes, there is nothing you need to do. Your current plan will be renewed automatically, and many people are happy to let that happen each year. If you do want to make a change, however, you need to inform Medicare and any insurance companies that are involved. Either way, your coverage choices take effect January 1.

If your insurance company has a Medicare advisor, a licensed sales agent who specializes in Medicare products, you may want to call on his or her expertise to help you make your best decision. Gary already gave his parents the advisor's number. Needs can change, and Medicare Advantage plans and their costs can change, so this is a good opportunity to evaluate your coverage, your costs and your needs.

Open Enrollment Period

Another period to be aware of is the Open Enrollment Period that occurs between January 1 and March 31. This gives Medicare beneficiaries one opportunity to enroll in or to leave a Medicare Advantage plan. There are certain stipulations that apply regarding your prescription drug plan, or Medicare Part D, when you make a change at this time.

Special Enrollment Period

Finally, just as in the old rule, "i before e except after c," there are a few exceptions. Under certain circumstances you may be eligible for a Special Enrollment Period in which you can change your drug coverage or health plan. For example, if Gary's mom and dad moved to a tropical retirement paradise and left the coverage area for their current Medicare Advantage plan, they would be allowed to make an enrollment change outside the usual dates. Of course, since Gary's dad is allergic to coconuts and sand flies, they probably won't be leaving for the beach any time soon.

Summary - Annual Medicare Renewal

If you want to keep the Medicare plan you currently have, you don't have to take any action for it to be renewed each year. If you want to make changes, there are certain times during which they are permitted. And it's a very good idea to review your coverage and your needs each year to make sure you are getting the most from your plan.