3 All-too-Common Medicare Mistakes Retirees Make

Millions of older Americans get their health coverage through Medicare. And whether you’re getting ready to enroll or have been on Medicare for years, it’s important to know how to get the most out of these benefits.

Unfortunately, not everyone knows how Medicare works. And that could lead to confusion and some bad choices. With that in mind, here are some big Medicare mistakes you should do your best to avoid.

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1. Sign up late

A delayed Medicare enrollment won’t necessarily just mean delayed coverage. It could mean paying more for Medicare Part B for life.

The initial Medicare enrollment window is seven months. It starts three months before the month you turn 65 and ends three months after that month.

If you do not sign up during the initial sign-up period, you will still be able to sign up. But at that point, you risk a lifetime surcharge for Part B — specifically, a 10 percent penalty for a 12-month period for which you were eligible to enroll in Medicare but didn’t.

Now you may be wondering what the rules look like when you already have access to a health plan when the initial Medicare enrollment window arrives. The answer is that if you are part of a qualified health group of 20 or more employees, you will generally be entitled to a special Medicare enrollment period once that group coverage ends. So in this situation, you can delay your Medicare enrollment without getting hit with a penalty.

But remember, not every health plan gives you this option. If you work for a small business with 12 employees on their health insurance plan, then you will face the above-mentioned surcharges with a late Medicare enrollment.

2. Overlooking the disadvantages of a Medicare Advantage plan

When it comes to Medicare coverage, you have options. You can stay with Original Medicare, which is Parts A and B plus a drug plan for Part D. Or, you can sign up for all-in-one coverage under Medicare Advantage.

There are certain benefits to choosing Medicare Advantage over Original Medicare. An Advantage plan might offer additional benefits beyond what Medicare originally covers and might even cost you less.

But there’s a big downside to choosing Medicare Advantage, and that’s that you’ll usually be limited to a specific provider network. This could make it difficult to get the care you need or find doctors who are conveniently located where you live.

With Original Medicare, you can see almost any doctor in the country that accepts Medicare. That gives you more options overall. And it might also make it easier for you to travel the country without having to worry about what to do if you need to follow up on a medical issue.

3. Do not review coverage options during open enrollment

Each year, Medicare conducts an open enrollment period that begins on October 15th and ends on December 7th. During this time, current enrollees can make changes to their coverage, whether it’s switching from one Part D plan to another, changing Advantage plans. , or switching from Medicare Advantage to Original Medicare.

If you are reasonably satisfied with your existing coverage, you may decide to leave enrollment open. But that could be a big mistake.

You never know when there might be a more affordable plan you’re eligible for. Or, there may be a plan with comparable costs whose benefits are far superior. So it’s always worth exploring coverage options in the fall, even if you don’t end up making a real switch.

It’s important to educate yourself on how Medicare works so you can get the most out of the program and keep your health care costs down in retirement. And while you’re at it, keep these mistakes in mind so you can hopefully avoid them.