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Medicare open enrollment, which runs from Oct. 15 to Dec. 7, is the time of year to make changes to your Medicare plans. 

It’s an opportunity to review your plan and see any changes to Medicare offerings in your area. Any changes you make during open enrollment kicks in on Jan. 1 of the following year. 

Here’s what you can change during open enrollment. 

  • Switch from Original Medicare (Parts A and B) to Medicare Advantage -- or vice-versa
  • Swap your Medicare Advantage plan
  • Change your Part D prescription drug plan (these plans are only available for people with Original Medicare)

There is also a limited open enrollment between Jan. 1 and March 31. During that time, you can only:

  • Switch Medicare Advantage plans
  • Move from Original Medicare to Medicare Advantage

You don’t have to make changes to your Medicare plan. You can decide to stay with the same coverage. That’s fine as long as those options are still available. 

Parts of Medicare

Before we go into the changes, let’s quickly review the types of Medicare:

  • Part A -- inpatient hospital care
  • Part B -- physician services, outpatient care, lab work, X-rays and preventive services
  • Part C (Medicare Advantage) -- Medicare plans offered by private insurers; coverage includes inpatient, physician and often prescription drug coverage and supplemental benefits, such as vision and dental
  • Part D (prescription drugs) -- Prescription drug coverage for people with Original Medicare (Parts A and B)

Parts A and B are often called Original Medicare. If you have Original Medicare, you can pair it with Part D for prescription drug benefits. You can’t get Part D if you have Medicare Advantage. 

The federal government offers Original Medicare. Private insurers offer Medicare Advantage plans. The Centers for Medicare and Medicaid Services estiamted that 42% of Medicare beneficiaries will have Medicare Advantage plans in 2021.

Medicare changes for 2021

Each year, Medicare makes changes to plans and offerings. Most of the 2021 reforms mean more options for you. 

Here’s what’s new for different pieces of Medicare:

Original Medicare

Part B premiums and deductibles are expected to increase. 

  • Part B monthly premiums will increase from $144.30 in 2020 to $148.50 in 2021. Note: People who make more than $87,000 and above $174,000 for joint filers pay higher Part B premiums. 
  • Part B deductible will increase above 2020's $197 limit to $203. 

Original Medicare often has higher premiums than Medicare Advantage plans. In fact, you will likely be able to find a Medicare Advantage option with no monthly premiums. 

It’s not a good idea to delay Medicare enrollment in Parts B and D if you decide on Original Medicare. One exception is if you have creditable coverage, such as group insurance. 

“If you delay with no creditable coverage, you’ll receive a penalty for both Part B and Part D of 10% each year you delayed coverage that will stay with you the rest of your life,” said Lindsay Engle, senior SEO marketing manager at Elite Insurance Partners.  

Medicare Advantage

Medicare Advantage will see lower average premiums in 2021 and more plan options for enrollees. CMS predicted more than 4,800 Medicare Advantage plans in 2021. The average county will have 47 plan options in 2021, which is an increase from 32 in 2020. 

Rural areas often have fewer Medicare Advantage choices, but CMS said more insurers will operate in rural areas in 2021. CMS estimated 2,900 plans in rural areas. 

What else is new for 2021? CMS said: 

  • The average monthly Medicare Advantage premium will decrease to $21. 
  • Telehealth will become the norm for Medicare Advantage plans. CMS said more than 94% of Medicare Advantage plans will have those benefits in 2021.
  • People with end stage renal disease can enroll in Medicare Advantage. Previously, they could only get Original Medicare. 
  • A new Medicare Advantage program will provide increased access to palliative care and integrated hospital care. CMS said 53 Medicare Advantage plans will partipate. 
  • More Medicare Advantage plans will offer supplemental benefits, such as adult day health services, caregiver support and in-home support services. CMS said about 730 plans will expand those offerings.
  • Medcare Advantage will host a model in which plans will offer benefits, including providing heatlhy food and meals, reduced cost-sharing and transportation. More than 400 Medicare Advantage plans will take part. 
  • About 500 plans will have lower copays and supplemental benefits for people with chronic conditions, including diabetes and congestive heart failure. These plans will help pay for meals and transportation. 
  • More plans will offer non-traditional medical care assistance for people with chronic conditions. These 920 or so plans will help pay for meal home delivery and transportation for non-medical reasons, including grocery shopping. 

So, there are lower premiums and more choices and supplemental benefits for Medicare Advantage in 2021. Also, nearly all plans will continue to offer dental, vision, fitness and prescription drug coverage. 

If you have an Original Medicare plan, you may want to check the Medicare Advantage offerings in your area to see if a plan works for you. 

Costs for Medicare in 2021

Premiums and out-of-pocket costs are vital when comparing Medicare plans. Here are the average premiums for Parts A-D:

  • Part A - This is usually free as long as you’ve been employed and paid the Medicare tax. The 2021 Part A premium for those who aren't eligible for premium-free coverage hasn't been set yet. In 2020, it was $437 for Part A for most people who didn't pay 10 years of Medicare taxes while they were working. Part A’s deductible was $1,364 for each benefit period, which is when you’re admitted to a hospital or skilled nursing facility. Expect that to increase slightly in 2021. 
  • Part B - The Part B monthly premium is $148.50 in 2021. Also, people with incomes beyond $87,000 for individuals and $144,000 for joint filers pay higher premiums. The deductible was $197 for 2020 and will be $203 in 2021. Once you meet that deductible, you pay 20% of your Part B healthcare costs. 
  • Part C -  The average monthly Medicare Advantage premium is $21 for 2021. Insurers have been decreasing the average premium, but you’ll want to compare plan deductibles. Those out-of-pocket costs can lead to hefty out-of-pocket costs. 
  • Part D (drug plan) - The average monthly basic Part D premium for 2021 is $30.50. Similar to Medicare Advantage, Part D premiums and deductibles vary. The highest Part D deductible is $445 in 2021, which is a $10 increase from 2020. 

When else can you change Medicare plans?

Open enrollment isn’t the only time you can switch Medicare plans. Other times are when you’re newly eligible or have experienced a life event that triggers a special enrollment period. 

When you’re first eligible for Medicare, you a seven-month span to sign up for coverage. That includes the three months before your qualifying birthday and the three months after that birth month. 

However, once you have a plan, you can trigger a special enrollment period when: 

  • You lose coverage (for instance, you get divorced or lose your job)
  • You move to another state
  • Your income changes
  • Your spouse dies

If those life events happen to you, you can contact Medicare about kicking off a special enrollment period. In that case, you’ll be able to make changes to your Medicare coverage or sign up for a new plan. 

What you should do during Medicare open enrollment

Open enrollment is a great time to review your plan and figure out what you want from a health plan. 

What to think about during Medicare during open enrollment:

  • Have your plan needs changed? 
  • Do you have a chronic illness that a Medicare Advantage plan targets? 
  • Are you paying higher premiums than you need? 
  • Is your plan’s deductible too high?
  • Is there a new plan offering that makes more sense for your situation? 
  • Is there a better Part D drug plan? Does that Part D plan cover your mediations? 
  • If you find a better plan, does your doctor and hospital accept it? 
  • What’s the plan’s quality rating? 

“Consider the impact of having to go through medical underwriting when switching plans,” Engle said. “If you’re outside your open enrollment, and don’t have guaranteed issue, you’ll have to answer medical questions when switching plans.”

Visit Medicare.gov to get information about plans in your area or call 1-800-MEDICARE. You can also go to the Medicare Plan Finder to compare plans available for you.