Advertiser Disclosure

6 Mistakes to Avoid When Selecting Medicare Advantage

Want to avoid mistakes when enrolling in Medicare? We listed the most common and expensive mistakes people make when enrolling in Medicare.

5 mins read
Our goal is to give you the tools and confidence you need to improve your health and finances. Although we may receive compensation from our partner insurance companies, whom we will always identify, all opinions are our own. CoverRight Inc. and CoverRight Insurance Services Inc. (NPN: 19724057) are collectively referred to here as "CoverRight".

There are many reasons why you should consider enrolling in a Medicare Advantage plan, however, before you enroll make sure you read this article to avoid these 6 common mistakes made by those who are considering enrolling in a Medicare Advantage plan.

Why should I consider a Medicare Advantage plan?

Outlined below are 4 reasons you should consider enrolling into or switching Medicare Advantage plans:

  • Medicare Advantage plans are getting better each year and insurance providers are getting increasingly competitive with each other. As result, a relevant new benefit that Original Medicare did not have one year could be available the next.
  • Prescription drugs covered by a plan may change from year-to-year meaning you could potentially be overpaying for prescriptions, particularly if your health condition has changed and you have started taking a new drug during the year.  The majority of Medicare Advantage plans bundle in Part D prescription drug coverage as part of the plan, so it is worthwhile considering whether a Medicare Advantage plan makes sense for you (if you are currently not in one) and/or shopping plans if you are already enrolled in one.
  • If you are already in a Medicare Advantage plan, you should consider checking your options each year as doctor networks can also change regularly and your primary care doctor or specialists may no longer accept the plan that you were previously on.
  • Finally, you may be able to get better service. Each year the CMS uses a five-star quality rating system to measure the experiences Medicare beneficiaries have with their health plan and health care system. As plans continue to expand their geographic presence to new service areas you may find a new plan with higher start ratings or 5 stars near you.

When can you enroll or switch Medicare Advantage plans?

You can switch or enroll in a Medicare Advantage plan during one of these Medicare Enrollment Periods:

  • ‘Annual Open Enrollment Period’: This period occurs October 15 – December 7 every year.  During this period, you are allowed to freely enroll, disenroll (and move back to Original Medicare) or switch to Medicare Advantage.
  • ‘Medicare Advantage Open Enrollment Period’: This period occurs January 1 – March 31 each year. During this period only individuals already enrolled in a Medicare Advantage plan on January 1 are allowed to switch plans or disenroll from Medicare Advantage.
  • ‘Initial Enrollment Period’: if you are turning 65, you have a 7-month period that begins 3 months before the month you turn 65 where you can enroll in a Medicare Advantage plan.
  • ‘Special Enrollment Period’:  You can also switch Medicare Advantage plans if you are eligible for a special enrollment period such as if you retire after the age of 65, move residences to a new area, receive Medicaid or Low Income Subsidy (LIS) support (in which case you can switch once every quarter) or if you gain or lose Medicaid support.

6 Common mistakes to avoid when choosing Medicare Advantage plans

Here are the 6 most common mistakes we see customers make when enrolling in or switching Medicare Advantage plans.

Mistake #1:  Picking the plan your friends recommend

While your friends and/or neighbors may highly recommend their current Medicare plan, you should always be mindful when taking their advice. This is because your health situation will not be exactly the same as theirs.  Your doctors and prescription drugs will as a result most likely also be different. So, the plan that works for your friend is probably not going to be the most optimal one for you.

Picking the wrong plan can cost you $1,000’s every year so it’s always better to do your own independent research into what is right for you. In particular, making sure your doctors and drugs are covered and optimizing around any additional services that you use is key.

Mistake #2:  Misunderstanding differences in provider networks (HMO vs PPO)

HMO or PPO plans are the two most common and popular Medicare Advantage plans.  Medicare beneficiaries can often mistake the two, resulting in surprises down the road when they are trying to access healthcare services.

HMO (Health Maintenance Organizations) generally costs less, however, you are typically only able to see providers that are within the plan’s network.  In addition, you must select a primary care doctor and will typically need a referral from your primary care doctor before you can see a specialist.

On the other hand, a PPO (Preferred Provider Organization) plan will generally cost more but gives you the additional benefit of out-of-network coverage. You also do not need to select a primary care doctor and often will not need to get referrals to see specialists.  This gives you a greater choice for doctors, which is important if you travel often or have many specialists to see.

If the doctor network is important to you or you travel often, make sure an HMO provider network is appropriate for you before signing up.

Mistake #3: Not appropriately checking your drug coverage

In 2023, 89% of Medicare Advantage plans include Part D (Prescription Drug) coverage. However, not all Part D coverage is the same. As drug costs can often be one of the biggest differences between differences in terms of day-to-day costs, not checking can be a big mistake and cost you hundreds if not thousands of dollars a year.

Each Medicare Advantage plan has its own ‘formulary’ which is a list of prescriptions it covers. While the government requires some plans to meet certain minimum thresholds in terms of coverage, the list for each plan can change year to year. There may also be material differences across different plans which can cause the out-of-pocket costs for the same prescription drugs to vary significantly.

Mistake #4: Thinking you can buy a separate Part D plan (Prescription Drug Plan)

If you are in a Medicare Advantage plan, you must obtain your Part D coverage through the prescription drug coverage available with your HMO or PPO plan. This means you are not able to buy a separate standalone prescription drug plan (PDP) if your plan provides prescription drug coverage.

We see many Medicare beneficiaries make the mistake of enrolling in a standalone PDP plan when they are on Medicare Advantage plan with prescription coverage.  Unless you are wanting to revert back to Original Medicare, if you enroll in a PDP you will automatically be disenrolled in from your current Medicare Advantage plan and lose benefits under that plan.

Mistake #5: Fear that your condition will impact your eligibility to switch

Many seniors worry that their health conditions may limit their eligibility to switch Medicare Advantage plans and as a result are hesitant to shop for plans each year. Medicare Advantage plans are not allowed to decline you based on your health conditions. As long as you are eligible for Original Medicare, already enrolled in Medicare Part A and B and within one of the enrollment windows, you are able to enroll in any Medicare Advantage plan in your area.

This, however, does not apply for Medigap (Medicare Supplement) plans which can decline to provide insurance or require you to pay an increased premium if you are switching plans and not enrolling during a ‘guaranteed issue period’.  Medigap plans can also only be purchased if you are on Original Medicare.

Mistake #6: Fear that your premiums increase from using health care services

Seniors who are on a Medicare Advantage plan may worry that using more services will increase the premium they are charged the next year. This is not true for Medicare Advantage plans.

Medicare Advantage plan providers are paid a set amount each year by the government to cover your health needs. By taking this amount, the Medicare Advantage plans agree to cover your health needs each year including capping your out-of-pocket costs. While you may have a monthly premium you pay that is above the standard Part B premium, this premium is unrelated and not tied to your health situation.

Final Words

Medicare Advantage plans are becoming more popular and each year plan providers continue to bring more benefits to Medicare beneficiaries. There are many reasons to enroll in a Medicare Advantage plan, including the fact that these plans often cover extra benefits not typically included under Original Medicare such as Part D drug coverage, vision, dental, and hearing.  If you are enrolling in a Medicare Advantage plan make sure to avoid the common mistakes we’ve outlined in this article.

At CoverRight, we’re here to help you find the right coverage that you deserve.   Reach out today and start finding the best Medicare plan for you.

Josef Katz

Josef is a digital marketing expert, is a podcast host of PrimeLife and formerly a licensed insurance agent. Josef has had an extensive career across the education, healthcare, insurance and financial services sectors and is passionate about educating consumers.

Latest from Blog