Medicare Part D Annual Open Enrollment

Medicare Part D Annual Open Enrollment

A couple, both age 65, retiring today will spend, according to Fidelity Investments’ 2013 survey, approximately $220,000 on health care during their retirement years – and that doesn’t include any assisted living or nursing care. While this year’s figure represents an 8 percent decrease from last year’s estimate of $240,000, making the most of your health expense resources during retirement can make a significant difference in how long your retirement savings will last.

The annual open enrollment period for 2014 Medicare Part D begins Oct. 15 and will extend until Dec. 7. The open enrollment period changed in 2011 to move the deadline away from the holidays to allow for more time to make decisions.

During the enrollment period, Medicare recipients can add, drop or change their prescription drug coverage (Part D). According to Medicare Today, anyone eligible for Medicare Part A (whether actually enrolled or not), or who is currently enrolled in Medicare Part B, may join Medicare Part D for help paying prescription drug costs. Your eligibility is not dependent on your income, health status or current prescription expenses. Although enrollment in Medicare Part D is voluntary, if a beneficiary does not sign up when first eligible and decides to enroll later, a penalty fee may apply.

Medicare Part D participants can choose between joining a Medicare prescription drug plan (PDP) through a Medicare-approved private company or joining a Medicare Health Plan, such as Medicare Advantage, that includes prescription drug coverage. If you are already enrolled in Part D, you can switch your plan during the enrollment period. For those using a PDP, changing plans has no impact on the doctors you see. With a Health Plan, however, you may be limited to the doctors within the particular plan’s group. That hurdle often discourages participants from changing plans, but if premium costs are a concern, participants would do well to investigate their options.

The Medicare Plan Finder can help you determine if you would benefit from switching plans. You will find this tool and many others at www.Medicare.gov. If you have questions or need additional help in determining how health care costs may impact your retirement, please call your financial advisers office.

FINANCIAL FACTS

Out Of Work – The national unemployment rate in the U.S. was 7.3 percent at the end of August 2013, the lowest unemployment rate reported by the government since December 2008. The 11.3 million out-of-work Americans is also the lowest total reported since December 2008 and is down 890,000 since the beginning of calendar year 2013 (source: Department of Labor, BTN Research).      

In Stocks – The average 401(k) participant had 61 percent of his or her retirement dollars invested in the stock market as of Dec. 31, 2011 (source: Employee Benefit Research Institute, BTN Research). 

How Long? – The current partial government shutdown is the 12th such slowdown since 1980 (past 33 years). Of the previous 11, the first nine (occurring between late 1981 and late 1990) all lasted three days or less. Only the 10th slowdown (starting in November 1995 and lasting five days) and the 11th slowdown (starting in December 1995 and lasting 21 days) were longer in duration (source: Congress, BTN Research).