Medicare policies are the health insurance benefits you have worked toward throughout your life, and having the proper policy is critical as you are likely to face more health problems as you age.
While these policies can provide you with the coverage you need for your health conditions later in life, they may be confusing to navigate for some and can include a variety of pitfalls. Whether you are ready for a Medicare policy or planning ahead for the future, below are some costly missteps that you can do your best to avoid.
Mistake 1: Failing to Sign Up at the Proper Time
Timing is crucial when it comes to signing up for Medicare, as failing to sign up at the appropriate time may result in penalties. The time to enroll is during the initial enrollment period, from three months before you turn 65 to three months after you turn 65. If you miss this window, your next opportunity to enroll is during the official general enrollment period, which runs from January 1 through the end of March. While you will be able to choose from the same policies and coverage, the monthly premium for the Part B portion will likely increase.¹
Mistake 2: Missing the Special Enrollment Period
If you are 65 and lose your health insurance coverage through job loss, or loss of coverage from your spouse, you will be able to sign up for Medicare under the special enrollment period, which will allow you to sign up outside of the general enrollment period without incurring a penalty. This special enrollment period is only in effect during your other policy coverage and up to eight months after. Missing this period could result in penalties.¹
Mistake 3: Not Comparing Original Medicare and Medicare Advantage Plans
It is essential to review the available plans and consider your health needs before deciding which policy to choose. Original Medicare is a federal government program with Part A for hospital costs and Part B for outpatient and doctor services. With original Medicare, Part D for prescriptions will need to be added as a stand-alone policy. Original Medicare does not cap your annual out-of-pocket costs. Medicare Advantage is a private insurance option that includes all three parts and also provides non-traditional services, such as transportation to medical appointments, as well as a cap on out-of-pocket expenses.²
Mistake 4: Not Enrolling in Part D With Original Medicare
Even if you don't have regular prescriptions you take, you will want to sign up for Part D when you sign up for your original Medicare. Failure to do so will result in a higher premium if you find out you need it later. Prescription costs are continuing to rise, and even the occasional prescription may result in costs higher than the addition to your premium.²
Important Disclosures:
Content in this material is for educational and general information only and not intended to provide specific advice or recommendations for any individual.
All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
Medicare's tiles can be confusing for many people. The Medicare website (medicare.gov) can be a valuable resource. Every year, Medicare also mails Medicare & You to beneficiaries and makes this fact-filled publication available online. You may want to review it to make sure you have an accurate understanding of the Medicare program.
This article was prepared by WriterAccess.
LPL Tracking #1-05374523
Footnotes:
1. “10 Common Medicare Mistakes to Avoid,” AARP,
2. “The Most Common Medicare Mistakes and How to Avoid Them,” US News
The financial consultants at Travis Financial Services are registered representatives with, and securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA / SIPC). Insurance products are offered through LPL or its licensed affiliates. Travis Credit Union and Travis Financial Services are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Travis Financial Services, and may also be employees of Travis Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Travis Credit Union or Travis Financial Services. Securities and insurance offered through LPL or its affiliates are:
|
Not Insured by NCUA or any other Government Agency
|
Not Credit Union Guaranteed
|
Not Credit Union Deposits or Obligations
|
May Lose Value
|
The LPL Financial registered representatives associated with this website may discuss and/or transact business only with the states in which they are properly registered or licensed. No offers may be made or accepted from any resident of any other state.
The "Contact TFS" and "Login to Your Account" links are provided as a convenient connection between the websites belonging to Travis Credit Union and its business partner. The policies and procedures in use at our business partner may differ from those in use at Travis Credit Union. Travis Credit Union is not responsible for the content contained in our business partner website.