What You Need to Know About Medicare for 2021
Transitioning into Medicare can be an intimidating process. If you’re enrolling in Medicare in 2021, you need to know how it works, when to enroll, and details about your coverage, so you don’t make costly mistakes.
There are several parts to Medicare
If you’re not automatically enrolled at age 65, you’ll need to enroll in Part A and Part B through the Social Security Administration (SSA). These two parts are known as Original Medicare. Once enrolled, you have the option to enroll in a Medicare Advantage or Medicare Supplement Plan.
Both Medicare Advantage and Medigap plans are purchased through private insurance carriers. If you enroll in a Medigap plan, Original Medicare is primary, and your Medigap plan is secondary. Medigap plans pay some or all of your share of covered Medicare expenses. If Original Medicare denies a claim, your Medigap plan won’t pay either.
If you enroll in a Medicare Advantage plan, also called Medicare Part C, your Medicare plan replaces Original Medicare. However, you must still pay your Part B premium as long as you have Medicare Advantage.
Medicare Advantage plans generally include Part D prescription drug coverage, but Medigap plans do not. Therefore, if you go the Medigap route, you’ll need a standalone Part D plan for prescription drug coverage.
There are important Medicare enrollments periods you shouldn’t ignore
Whether you’re new to Medicare in 2021 or you’re already enrolled, there are important enrollment periods to keep in mind. New Medicare beneficiaries should prepare for their Initial Enrollment Period (IEP) and Medigap Open Enrollment (OE).
Your IEP is generally the time you’ll want to enroll in Original Medicare and either a Part D plan or a Medicare Advantage plan. Your IEP starts three months before your 65th birthday month and ends three months after (7 months total).
Your Medigap OE is the best time to enroll in a Medigap plan because there are no health questions during this time. Once this window closes, you’ll have to pass medical underwriting to buy a Medigap plan. Your Medigap OE starts on your Part B effective date and ends six months later.
Note that Medicare Advantage plans have no health questions as of 2021, so you can’t be turned down for a pre-existing condition such as end-stage renal disease. However, there are specific enrollment periods for Medicare Advantage.
If you’ve already enrolled in Medicare, you should look out for the Annual Election Period (AEP – October 15, 2021 – December 7, 2021). This annual fall enrollment period is one of the few times you can make changes to an existing Medicare Advantage plan, enroll in a new Part D or Medicare Advantage plan, or drop a Part D or Medicare Advantage plan. If you are already enrolled in Medicare Advantage, you can also use the Medicare Advantage Open Enrollment Period (January 1 through March 31) to make changes to your coverage.
Insulin-dependent Medicare beneficiaries have new Part D plan options
If you take insulin, your prescription may be covered under Part B or Part D, depending on how it’s administered. For example, if you receive your insulin through a Medicare-approved pump, Part B will cover your insulin prescription as well. However, if you administer your insulin yourself, you’ll look to Part D for coverage.
In 2021, there is a new insulin savings program called the Part D Senior Savings Model. If you enroll in a plan participating in the new program, your Part D-covered insulin will never cost you more than $35 for a 30-day supply. If you’re an insulin-dependent beneficiary, you should enroll in a Model Part D plan during your IEP and then shop plans again during the AEP. Doing this will ensure you’re always enrolled in the most cost-effective Part D plan this year and next.
While there are many decisions to make in your first year on Medicare, you’ll also have some annual choices to make each year. It’s recommended you always research your coverage options to avoid costly Medicare mistakes.
About Danielle Kunkle Roberts
I’m a Medicare Supplement Accredited Advisor, National Social Security Certificate Holder, and the chief blogger here at Boomer Benefits. My agency is licensed and appointed in 48 states and we have helped tens of thousands of Medicare beneficiaries understand their benefits since 2004.
I write articles in my column at Forbes, where I am a member of the Forbes Finance Council, to help readers like you to navigate the Medicare enrollment process and live to tell about it. Connect with me and our over 400,000 fans on Facebook for continuing tips about Medicare.