Health Insurance Matters: Timing is Everything

 

Timing is Everything

Richard was in a panic. He instated that staff schedule an appointment with me immediately, as he was otherwise going to miss the opportunity to get a Medicare plan.
Susan had an almost identical issue. So, I met with both of these people at their scheduled times. It was late afternoon for each, as the calendar was filling up with the daytime hours.
In both instants, these people were unaware of the meaning of the “Annual Enrollment Period (AEP). As timing is everything, I believe the Kern River Valley needs a refresher on Medicare’s time tables.

Enrollment in Medicare. Generally, this is a seven-month window. It begins for most people when they are about to turn 65. It begins three months before the month in which you turn 65. It is time to enroll in Medicare Part B. If you are already receiving early Social Security benefits, your ID card will arrive in the mail. If not, you must enroll. The process is getting more difficult, as the government is trying to prevent identity theft, so there will be several questions to prove who you are. Go to www.socialsecurity.gov/medicareonly to enroll. If this doesn’t work, call Social Security at 1-800-772-1213 and inform them you want to enroll in Medicare Part B. You may also go in to a local Social Security office. This must be done early, as the office visits are long and difficult most times of the year as they are very busy. If you do not apply during this window, it is a long wait for the next opportunity. That would be the General Medicare enrollment period, which is January 1 to March 31 each year, with coverage not beginning until the following July 1. Oh, and there may be financial penalties for late enrollment. There are exceptions to this if you are working and covered by an employer benefit plan, but not COBRA!

Annual Enrollment Period is specifically based on Medicare plans that include prescription drugs. If you are in or wanting to enroll in a Medicare Advantage plan (MA) or a Prescription Drug Plan (PDP) this is the time slot for changes and enrollment. It begins on October 15 and runs until December 7. If you miss out, you may need to remain in your current situation until the following year. Plans enrolled in the AEP begin January 1. Because the fire storms that have ravaged California, if you live in, or a family member or trusted advisor resides in the counties that have burned, a special time slot, now until March 31 may provide an exception for certain MA and PDP enrollments.

Open Enrollment Period has been created to allow for some wiggle room. If you had signed up during the AEP and now it is early January and you discover that your MA plan isn’t what you were believing it to be, you have a one-time chance to change plans. Your reason might be that your doctor isn’t on the plan, it doesn’t cover your medication or you simply don’t like it. Your opportunity is to switch to another MA plan or go back to original Medicare and get a PDP plan.

If you go back to Original Medicare keep in mind that there is no guarantee that a Medicare Supplement plan is available. All Medicare Supplement plans ask medical questions, and you may not qualify. Once again, by planning early, you can avoid the pitfalls by applying before you drop your current situation. On approval, then make the change.
Medicare Supplement plans do not fall into the above. There enrollment timetable is based first on your eligibility. They are “guaranteed issue” when you first enroll in Medicare Part B. You have up to 6 months from the Part B effective date for the Guaranteed Issue (GI) rule. Afterwards, you have to answer the medical history questions and the insurance company has the right to not issue you a plan. Changing these plans falls under a California law; the Birthday Rule.

You have an opportunity to change “to a plan of equal or lesser coverage” for a period of 30 days following your birthday. Coverage will begin on the first of the following month following approval. You may apply for the 30 days prior to your birthday. Your insurance company will mail you a notice about this, but the wording often implies that you can downgrade your present policy with them. You can switch to any plan of equal or lesser coverage; a great opportunity to do some price comparisons.
Richard and Susan, and the many others living here in the KRV now know some of the rules. Procrastinators beware. It takes time for all of the above to happen. This is a very busy time of the year for the government, insurance plans and yours truly. It is NOT like the tax accountant. All the work must be submitted by the close of the AEP on December 7. Unlike the accountant, there are no extensions to be filed. You use it or lose it.

There are exceptions and special rules for people who are covered under an employer plan or having special circumstances. Don’t “assume”. You are probably wrong, and a mistake can be costly. Ask.

Harry P. Thal, MA, is a licensed insurance broker in California (0621106) and 26 other states. His offices are in Kernville. He is a member of the Society of Certified Senior Advisors and Past-President of the Kern Association of Health Underwriters.He may be reached at 760-376-2100, e-mail harrythal@aol.com or visit him on the web at www.harrythal.com.

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