Today we’re going to answer the question, “What and when is the Annual Enrollment Period?” We also explore how the Annual Enrollment Period (AEP) works and who qualifies to switch plans during the AEP. 

How Medicare Works: A Brief Overview

Before we look at the annual enrollment period, let’s briefly review how Medicare works.  When a person goes on Medicare, the first thing they have to decide is how they will use their inpatient and outpatient coverage through Medicare. There are only two options. First, you can stay on Original Medicare and get a Supplemental plan to help fill in the gaps left in original Medicare coverage. If you choose this route, Medicare will be in the first payor position and the Supplemental insurance company pays second, helping cover the gaps original Medicare doesn’t pay for. 

The second option is to get an Advantage plan (also called a replacement plan). This means you’ll be covered directly by a private health insurance company. So instead of Medicare paying for claims first, Medicare will simply pay a certain amount each month to the Advantage plan company, and that company will handle your claims directly (of course you’ll be responsible to pay copays and coinsurance). 

If you stay in original Medicare and get a Supplemental plan, you’ll also have to purchase a separate drug plan. If you go with an Advantage plan, the drug plan will most likely be included. 

What & When is the Annual Enrollment Period?

The annual enrollment period lasts from October 15th to December 7th every year. During this window of time, people on Advantage plans (Part C plans) or prescription drug plans (Part D plans) can switch to a new plan. 

In other words, Part C and D plans are only written for one calendar year (unlike original Medicare A and B, and Supplemental plans which are written for life). So leading up to the end of that calendar year, you have the opportunity to switch to a new C or D plan if you don’t like your current one. 

How Does the Annual Enrollment Period Work?

Every year before the annual enrollment period begins (usually around October 1st), Advantage companies and prescription drug plans will mail you a packet in the mail called the Annual Notice of Change (ANOC). They do this to notify you of the changes taking place in your plan the next year. Advantage and drug plans are allowed to make any changes they want to your plan, so it’s very important to carefully read through these changes to make sure you’re OK with them. If you don’t like the changes, you can switch to a new plan during the annual enrollment period. 

We’ll now explore the plans you can switch to during the Annual Enrollment Period of October 15th through December 7th. 

Advantage Plan -----> Supplemental Plan

Let's suppose you're covered by an Advantage plan and you decide you want to switch to a Supplemental plan. This means you’ll return to your original Medicare A and B, purchase a Supplemental plan, and add a drug plan to that. Keep in mind, you can only make this switch between October 15th and December 7th.

If you've been on an Advantage plan longer than one year (the trial period), you’ll have to medically qualify to get on a Supplemental plan. To medically qualify, the Supplemental insurance company will put you through their medical underwriting process. This typically involves a health questionnaire, medication evaluation, pre-existing conditions check, and a statement from your doctor. So if you’ve been on an Advantage plan for more than 12 months, you can’t automatically switch to a Supplemental plan. You will have to medically qualify. And again, you must make the switch and go through medical underwriting during the annual enrollment period between October 15th and December 7th. 

Supplemental Plan -----> Advantage Plan 

Now let's say you're on a Supplemental plan but you decide you no longer want to pay the monthly premiums. So you decide to switch to an Advantage plan. Once again, you have to make this switch during the AEP. When switching from a Supplemental plan to an Advantage plan, you will not have to go through an intensive medical underwriting process. The only thing that can keep you from making the switch is if you have end-stage renal disease. If not, you will be free to make that switch. 

Advantage Plan -----> (Different) Advantage Plan 

Now let's suppose you’re on an Advantage plan but you’re no longer happy with that particular plan. Maybe your doctor is no longer within the network or the company notified you of a change for next year that you don’t like. During the Annual Enrollment Period, you can switch from your current Advantage plan and enroll in a different one. Again, the only thing that will keep you from switching to a different Advantage plan is if you have end-stage renal disease. Otherwise, you’re free to make that switch during the AEP. 

Prescription Drug Plan ------> New Prescription Drug Plan

If you're on a separate drug plan (not an Advantage embedded drug plan), and you no longer like your plan, you can switch to a new one during the Annual Enrollment period. Reasons you might want to switch to a new drug plan include raised premiums, changes in the formulary, and your medications changing tier levels. If any of these changes occur and you want a new drug plan, you can make this switch from October 15th to December 7th. 

Conclusion

The annual enrollment period is a window of time that lasts from October 15th to December 7th every year. During this time, people on Advantage plans (Part C plans) or prescription drug plans (Part D plans) can switch to a different plan. 

We understand how difficult making the right Medicare decisions can be. To take the next step, watch our full course here, or schedule a free one-on-one call with a certified Medicare School Guide who can answer your questions, compare plans options, and even help you enroll. Click here to get started.

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