Open enrollment cutoff for Medicare plans moves up

A new deadline for privately run versions of the government’s Medicare program may trip up customers who typically wait until the holidays to settle on their health insurance coverage for the coming year.

This fall’s open enrollment deadline for Medicare Advantage plans and Part D prescription drug coverage has been moved up nearly a month to Dec. 7. The new deadline aims to help prevent coverage problems arising from late-December enrollment decisions, but it also could pose a quandary for many beneficiaries.

Medicare Advantage plans cover more than 11 million people. They offer basic Medicare coverage topped with extras, such as vision or dental coverage or premiums lower than standard Medicare rates.

Most beneficiaries enroll after they turn 65. Then they have an open enrollment window every fall in which they can drop their coverage and switch to another plan. Here are some questions to consider this fall.

What deadlines will change?

Beneficiaries will receive their annual notice telling them about any changes in their coverage for next year by Sept. 30, which is a month earlier than last year. Insurers then will start marketing their 2012 plans on Oct. 1.

This year’s open enrollment runs from Oct. 15 to Dec. 7. That’s a longer stretch than last year’s window of Nov. 15 to Dec. 31.

But the health care overhaul calls for the earlier deadline to ensure that new coverage begins as planned on Jan. 1, according to a Senate Finance Committee aide. The new date provides more time for applications to be processed by the end of the year.

Will the deadline changes affect many beneficiaries?

Medicare Advantage customers will have enough time to consider their options and enroll in another plan if they avoid waiting until the last minute, said Judith Stein, executive director of the Center for Medicare Advocacy, a Connecticut-based consumer group.

But last-minute stragglers are common. Plans can receive as much as a quarter of the applications for coverage they normally get during open enrollment in those last three weeks of December, according to Matt Burns spokesman of UnitedHealth Group Inc., the largest Medicare Advantage coverage provider with more than 2 million customers.

Many people take time to make their coverage decisions. Beneficiaries start seeing Medicare Advantage ads in the fall. Then they might talk to their families, stew on the decision, and wait for the holidays to pass, said Dr. Jan Berger, chief medical officer at Silverlink Communications Inc., which works with Medicare Advantage providers.

What happens if you miss the deadline and make no changes?

This can get complicated.

If the plan is still offered for 2012, then a customer who doesn’t make any changes remains enrolled. But details of that plan may change.

If the plan is discontinued, customers may be switched to another Medicare Advantage plan offered by the same insurer. They also could be dropped into regular Medicare, which does not provide prescription drug coverage.

Options do not completely dry up if a beneficiary misses the Dec. 7 deadline. From January 1 to February 14, Medicare Advantage customers can drop their plans and enroll in regular Medicare. During this time, they also can pick a Part D prescription drug plan to go along with that coverage, but they cannot jump to another Medicare Advantage plan.

Here’s another wrinkle: Beneficiaries can enroll any time during the year in a Medicare Advantage plan that has prescription drug coverage if they receive a low-income subsidy or if they have access to a plan with a five-star quality rating. The catch: Only a few plans attained that rating for this year, said David Lipschutz, an attorney with the Center for Medicare Advocacy.

The government will announce a new list of five-star rated plans next month.

Should Medicare Advantage customers review their coverage even if they don’t plan to make changes?

Absolutely.

Plans can change how they cover expenses from year to year. Customers may find that prescription drugs that were covered last year aren’t covered in the new year, or they may suddenly face a big bill for a costly treatment like chemotherapy. Any changes will be laid out in the annual notices consumers receive from their insurers.

“People really, really need to look carefully and not assume that because something worked last year it will work this year,” Stein said.