As the insurance industry updates its products, the Medicare Advantage plans that are available change.  That is why it is especially important to check out the changes to your current Medicare Advantage plan as well as the other plans available in your area.  You want to stretch your dollars so that you get all of the benefits that may be critical to your ongoing wellbeing.

Every year, there is an open enrollment period where you can renew your current Medicare Advantage plan and peruse the other plans on the market for the coming year.  This year, the open enrollment period begins on October 15 and ends December 7, so make sure that you make any enrollment decisions during this period. During this period, you may also switch from a Medicare Advantage to traditional Medicare if you desire.  In some regions, this time of the year is the only time to purchase Medigap policies that provide additional benefits over Medicare Parts A and B.

Before you make any decisions, however, you should learn about how Medicare Advantage plans are changing in 2018. Some of these changes are a result of long-term, systemic changes to the federal program, while others are due to immediate alterations to the insurance markets.

Some Background to Medicare Advantage

In the 1970s, Medicare began offering managed care health plans through private health insurers in an effort to lower costs while improving care quality.  In 1997, Congress formally designated these plans as Medicare Advantage policies under the program name Medicare Part C. Currently almost 18.3 million Americans, or 32 percent of all Medicare beneficiaries are covered through Medicare Advantage plans.

Enrollment in Medicare Advantage plans has skyrocketed in recent years due to extremely high levels of consumer satisfaction.  Since 2010, the number of people enrolled in Medicare Advantage plans has jumped 60 percent.  This is due primarily to the added benefits that many Medicare Advantage plans offer like prescription drugs, dental and vision, while maintaining a price point that is comparable to traditional Medicare.

In the last year, Medicare has made some changes to the program.  The agency has lowered funding to the Medicare Advantage program by 1.5 percent as a result of adjusted risk scores.  In an effort to bring Medicare Advantage plans more in line with original Medicare, the agency implemented a mandatory minimum coding intensity adjustment that aligned coding practices by 5.66 percent. Medicare also adjusted its Employer Group Waiver Plans and lowered its funding to these plans by 1.25 percent; it is likely it will make a similar adjustment in 2018.

Upcoming Changes for 2018

One of the most important changes coming to most Medicare Advantage policies is a modest increase in the payment rates, or the amount that the agency provides to private insurers to administer these Medicare Advantage plans. In 2017, the increase in payment rates was 0.85 percent, but the agency will lower this to an increase of 0.25 percent for 2018.  Medicare would also like to raise payments to insurers that enroll more low-income seniors.

An unfortunate change for many Medicare Advantage enrollees expected in 2018 is a declining number of available plans.  In 147 rural counties among 14 states, there will be no insurers offering Medicare Advantage policies.   For seniors in these limited availability areas, they should consider enrollment in traditional Medicare along with a supplemental Medigap plan.

The Centers for Medicare and Medicaid Services or CMS, the agency that oversees these federal insurance programs, has also released its drug pricing data for Medicare Part D for 2018.  The data reveals a slight drop in premiums for next year due in part to lower prices for many generic drugs. However, you may wish to keep in mind that the price drop may not include medications you take; in other words, before you enroll in Medicare Part D, be sure to investigate the prices under this program compared to other Medicare Advantage plans.

More Medicare Advantage plan providers are offering plans with zero dollar monthly premiums, but more of these plans will have higher out-of-pocket maximums.  It is important to closely examine your financial responsibilities under these plans, to determine if you are likely to pay more than with your current plan.

If you are well off, you may wish to consider switching from traditional Medicare to a Medicare Advantage plan because Part B surcharges are going up for some higher income beneficiaries. Starting next year, certain enrollees who earn more than $214,000 as a couple or $133,000 as an individual could pay more in Part B surcharges.

Finally, Part B premiums will remain unchanged for 2018.  While this is good news for new enrollees in traditional Medicare, it is actually a detriment to many enrollees who have Part B premiums automatically deducted from their monthly Social Security checks. This is due to the “hold harmless” provision that adjusts Part B premiums to match cost of living adjustments (COLA).  For those already enrolled in Medicare Part B, they are likely to see a 2 percent premium increase due to COLA.

How to Prepare for 2018 Changes

If you want the best possible plan for you, you should take the time to research how Medicare Advantage plans match up against your needs and one another.  In addition to costs and benefits, you should also keep in mind the type of provider network they utilize.  In recent years, more plans have adopted narrower networks that may not include your chosen providers. If you don’t see them in a Medicare Advantage plan you like, you may want to consider original Medicare which is much broader in scope.

This can be a complex, challenging task, so if you feel you need extra assistance, you may be able to use your State Health Insurance Assistance Program. These federally-funded agencies offer unbiased advice for Medicare recipients.  However, you should contact these agencies as soon as possible because the Trump administration plans to discontinue funding them. You may also find the answers you need at Boost Health Insurance.