Medicare beneficiaries in Advantage Plans can change 2023 coverage

For Medicare beneficiaries enrolled in an Advantage Plan, now’s the time to change your 2023 coverage if it’s not a good match.

Each year between Jan. 1 and March 31, beneficiaries unhappy with the choice they made during Medicare’s annual open enrollment period — which ended Dec. 7 — can switch to a different Advantage Plan. Or, they can drop the one they have altogether in favor of basic Medicare (Part A hospital coverage and Part B outpatient care coverage).

“It’s the time of year when only beneficiaries in Advantage Plans who feel they made the wrong plan selection for 2023 can change it,” said Elizabeth Gavino, founder of Lewin & Gavino and an independent broker and general agent for Medicare plans.

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Common reasons to do so include discovering a preferred doctor or other provider is not in network — which means you pay more to see them — or finding out your prescriptions either are uncovered or cost more than anticipated.

Of Medicare’s 64.5 million beneficiaries — the majority of whom are age 65 or older — about 29.1 million are enrolled in Advantage Plans, which deliver Parts A and B and usually Part D prescription drug coverage, along with extras such as basic dental and vision. However, they come with their own cost-sharing structures (i.e., deductibles and copays) and their lists of drugs covered (and their cost), which differ from plan to plan — and are likely to change from year to year.

In contrast to Medicare’s annual fall enrollment, when a variety of options were available for those who wanted to modify their coverage, this Advantage Plan-related window comes with restrictions.

For starters, you can only make one switch. This means that once you move to a different Advantage Plan or drop it for basic Medicare, the change is generally locked in for the year. 

This means it’s important to be sure your new choice will work for the rest of 2023. If you are looking for a more suitable plan, you can use Medicare’s online plan finder.

Alternatively, if you want to make sure your doctor or other key provider is in network with a plan you’re considering switching to, you can check directly with them, said certified financial planner and physician Carolyn McClanahan, founder of Life Planning Partners in Jacksonville, Florida.

“Call your doctor’s office and ask what their favorite Medicare Advantage Plan is,” said McClanahan, a member of CNBC’s Financial Advisor Council.

You also could check with your pharmacy if you want to confirm your prescriptions are covered. “They see a lot come through so they often do know which Advantage Plans cover your drug,” McClanahan said. 

Be aware that the current three-month window also differs from fall enrollment in that you cannot switch from one standalone Part D plan to another. 

If you picked a Part D plan in the fall open enrollment period based on faulty or misleading information, you can call 1-800-Medicare to see if your situation would allow you to make a change.

Meanwhile, dropping an Advantage Plan in favor of basic Medicare often means losing drug coverage — which means you would have to enroll in a standalone Part D plan.

This matters, because if you go 63 days without the coverage, you could face a lifelong late-enrollment penalty that gets tacked on to your monthly premiums. That charge is 1% of the national base premium ($32.74 for 2023) for each full month you go without drug coverage.

Also, if you want to switch to basic Medicare and pair it with a supplemental policy (so-called Medigap), be aware that you may not qualify for guaranteed coverage. These policies either fully or partially cover cost-sharing of some aspects of Parts A and B, including deductibles, copays and coinsurance.

However, they come with their own rules for enrolling. Depending on your state, you may need to pass medical underwriting to get approved for a Medigap policy. This makes it worth knowing first that you would be able to be approved, said Danielle Roberts, co-founder of insurance firm Boomer Benefits.

There is an exception to the medical underwriting requirement: If you are within the first year of trying out an Advantage Plan, you generally can return to a Medigap policy without facing underwriting.

Also from Jan. 1 through March 31, separate from the Advantage Plan window: If you missed your initial Medicare enrollment period, you can sign up during this timeframe. As of this year, coverage takes effect the month after you enroll (it previously was July 1).