In the last article, we discussed Medicare Advantage plans. This is a continuation of that article, because with few exceptions, when you are allowed to change your plan is dependent on HOW you receive your benefits. If you are on a Medicare Advantage plan, you have more opportunities to do so than if you were on Original Medicare with a Medicare Supplement.

When Can I Get or Change My Plan (Election or Enrollment Periods)?

Just like Original and Traditional are used to describe Original Medicare, Election and Enrollment are used interchangeably as well. But for all intents and purposes, they mean the same.

Medicare has four (4) general election periods. There are more, but they will not be covered here as they really are more for your agent to know if there is a need, to be able to change your plan to meet your need (for example, MA-OEP).

They are:

1. ICEP/IEP: Initial Coverage Election Period/Initial Election Period
2. AEP: Annual Election Period
3. OEP: Open Enrollment Period
4. SEP: Special Election Period

ICEP and IEP

Since IEP and ICEP typically happen together (but not always), people tend to use the shorter IEP to describe both. But they are different enrollment periods.

ICEP pertains to Part B, while IEP pertains to Part D. Why is this important? Because if you elect to continue working and choose to put off taking your Medicare until you retire, when you do you will have 8 months to take your Part B or face penalties, but only 63 days to take your Part D or face penalties. We will touch on this in the next section, Penalties.

But for the most part, people tend to take their Medicare at 65 and therefore, both happen simultaneously. You have a total of 7 months to make your election:

• Three (3) months before your birthday month
• Your birthday month
• Three months AFTER your birthday month

Now, this doesn’t mean you can pick a plan and change it as often as you would like up to the end of the seventh month. No. Once you have applied for your Parts A and B, and select a Medicare Advantage plan and it becomes effective (a three-dollar word that means it’s active), your ICEP/IEP is over. You have made your election.

However (I said I wasn’t going to cover it, but here I go), you then have a special Medicare Advantage Open Enrollment Period for two (2) months (MA-OEP). Therefore, if you feel you made the wrong choice, your agent can change your plan within those two months.

AEP (Annual Enrollment Period)

This is what we are about to start on October 15^th, and it runs through December 7^th. This is the time of the year when your phone drives you crazy and every geriatric actor/singer/athlete chooses to live on past glory and try to convince you to call a telemarketing operation to change your insurance plan. Well, it’s not the official description…but it should be!

AEP is when you get with your agent and do your Annual Notice of Change (ANOC). What this means for you is your agent will let you know what changes may take place to your existing plan for the following year. He or she will also inform you if there may be something better. Then you must choose whether to stay on your current plan or change it starting on January 1^st of next year.

OEP (Open Enrollment Period)

Many people confuse AEP with OEP. However, OEP runs from January 1^st through March 31^st. I like to say that it’s called OEP because people say, “Oh, Oh…I made a mistake during AEP, so I better fix it!” And, in essence, that is what it is. One opportunity to change your plan if you feel you made the wrong choice during AEP.

OEP is ONLY for those on a Medicare Advantage plan. If you are on Original Medicare, you are not eligible to change your plan. If you want to change from a Medicare Supplement to a Medicare Advantage plan, you must have an eligible code (AEP or an SEP, which we cover below).

SEPs (Special Election Periods)

Now, from April 1^st through September 30^th, it is The Lockdown Season. You are not supposed to be able to change your plan. However, Medicare understands life happens, and when it does, there must be a mechanism to allow one to change his or her plan if needed. That’s where Special Election Periods come in.

There are many, so I won’t cover them here. I will save that for another article. But just know that if life happens, other than 911, your agent should be the next call you make. Whether it’s you got sick, moved, lost coverage, have a financial hardship, etc., call your agent!

Finally, Penalties

If you do not take your Medicare when you should, whether you are on Social Security Disability (SSDI) for 24 months and are eligible on the 25^th month, or whether you are turning 65 and do not have creditable coverage provided by a spouse or employer, you will incur lifetime penalties you won’t get rid of if you don’t qualify for Medicaid.

Veterans need to pay close attention to this! Many choose not to take Medicare, because they go to the VA. The VA states on their website that veterans should not let go of their Medicare benefits. While I will discuss this in detail in another article, they do NOT guarantee medical services to veterans in Groups seven (7) and eight (8) if there should be a budget cut. There are also another 10 reasons why veterans need their Medicare. Stay tuned for that article!

For Part D, prescription drug plans, the penalty is 1% for each month you went without a drug plan, after 63 days have passed. For Part B, your medical insurance, it is 10% for every 12 months without it. And as stated above, the only way to get rid of these penalties is to qualify for Medicaid. There are other creative ways to help reduce them, with plans offering Part-B givebacks, but it doesn’t eliminate them.

So, there you have it! Medicare Advantage for the layperson.

As we continue on this series, you will come to understand your options better and will be able to decide what is best for you. In the meantime, if you have any questions and can’t wait for the other articles, please feel free to contact us for a NO OBLIGATION FREE CONSULTATION, by clicking on CONTACT US. Also, download your FREE digital Medicare & You 2024 guidebook.

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