What to know for open registration

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If you’re a Medicare beneficiary, now is the time to assess your prescription drug coverage for 2023.

In addition to checking during annual Medicare fall enrollment to see if you can get a more cost-effective plan, you should be aware of some legislative changes coming into effect next year that could reduce the amount you pay. out of your pocket for your cover.

“It’s about quality of life,” said Elizabeth Gavino, founder of Lewin & Gavino and independent broker and general agent for Medicare plans. “Saving money on medication means more Social Security money is left over for other necessities of life.”

Learn more about year-end planning

Here’s a look at more coverage on what to do financially as you approach the end of the year:

The Medicare enrollment period opened on October 15 and ends on December 7. Beneficiaries can make changes to their coverage during this time.

Prescription drugs are typically dispensed through Medicare Part D. Of the estimated 64.5 million people enrolled in Medicare, approximately 50 million have such coverage, either through a standalone Part D plan, or an Advantage plan, both offered by private insurance companies. Advantage plans provide Part A (hospital coverage) and Part B (outpatient care) and usually Part D.

Here are some changes you might notice next year, along with tips on what to look for when evaluating your options for 2023.

Insulin charges will be capped

Certain changes to prescription drug coverage, enacted under the Inflation Reduction Act, coming into force next year. This includes a $35 monthly cap on insulin cost-sharing under Part D, which will begin Jan. 1. Some plans may already offer a $35 cap.

Part D deductibles — which vary from plan to plan but cannot exceed $505 in 2023, up from $480 this year — also won’t apply to the covered insulin product. For recipients taking insulin through a traditional pump (which falls under Part B), the benefit begins July 1.

“Some of my clients had to choose between buying food and buying insulin. [or] ration insulin to make it last longer, thus taking far less than the prescribed amount,” Gavino said. “It was dangerous, and now they can use the right amount they need to live.

100% coverage for recommended vaccines

Additionally, there will no longer be cost sharing for inoculations recommended under Part D beginning January 1, including for the shingles vaccine.

“In the past, many people paid quite a high price for the shingles vaccine because of the rather high Part D deductible,” said Danielle Roberts, co-founder of insurance company Boomer Benefits.

“The vaccine was usually a covered drug, but since they hadn’t met the deductible yet, they spent a lot on it,” Roberts said.

other supplies to reduce Part D expenditures take effect in subsequent years. This includes eliminating an existing 5% coinsurance in the so-called catastrophic phase of coverage, which takes effect in 2024, and capping beneficiaries’ annual Part D expenses at $2,000, which takes effect in 2025. Currently, there are no payout limits whether you obtain your coverage as a standalone Part D option or through an Advantage plan.

Medicare will also be able to start negotiating the price of certain drugs starting in 2026.

Your plan may change its list of covered drugs

Regarding choosing your 2023 coverage: while you are not required to take any action during open enrollment – your current coverage will generally continue into next year – plans often change their list of covered drugs and their price.

Additionally, each plan assigns individual drugs to different tiers, with the first tier usually being the cheapest and the fifth the most expensive. From year to year, various drugs can move from one level to another in a given plan, making it important to check where your prescriptions stand for 2023.

Also be sure to look at the pharmacies included in the plan. Some are “preferred” – meaning your medications will be cheaper there than at a “standard” pharmacy.

“The pharmacy you use can really impact the price of what you pay for your prescriptions,” said Ari Parker, senior counsel at Chapter, a Medicare consulting firm.

Beneficiaries with higher incomes pay more for coverage

The average monthly premium for standard Part D coverage next year is expected to be $31.50, up from $32.08 in 2022, according to the Centers for Medicare & Medicaid Services. However, be aware that if your income exceeds certain limits, you will be subject to what is called monthly income-related adjustment amounts, or IRMAA, which are in addition to any premium you pay (see table below). Part B also includes these additional amounts.

Your 2021 tax return is generally used to determine whether you are subject to these surtaxes in 2023. You can request a reconsideration if your income has decreased since then.

Obtaining prescription drug coverage through Medicare is optional. However, if you fail to enroll when you qualify for coverage at age 65 and later change your mind, you will be subject to a lifetime penalty unless you meet certain exclusions, that is, you receive acceptable coverage through an employer.

The the penalty is 1% of the national base premium for each month you did not have Part D or valid coverage and should have had it.

Be aware that while you can change your Advantage plan early next year – from January 1 to March 31 – if you find it’s not right for you, the standalone plans in the game are not. D.

“Unless a special circumstance applies, you won’t be able to change it,” Parker said.

In addition, you can sometimes find medications cheaper than in your plan, for example with a free drug discount card. However, if you go this route instead of going through your insurance, your plan won’t factor in the cost of the drug and your share of your deductible or other calculations it uses to determine your share.

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