3 things to know about your Medicare plan options for 2020

By Ann Kayrish, Senior Program Manager for Medicare, National Council on Aging
couple looking at tablet assessing health care costs

The Medicare open enrollment period (OEP) runs from October 15 through December 7 each year. It is an opportunity to evaluate your Medicare coverage and make changes which become effective January 1, 2020.

During the OEP you can:

  • Change from Medicare Parts A & B (Original Medicare) to a Part C (private Medicare Advantage) plan
  • Change from Medicare Advantage back to Original Medicare
  • Join, drop or switch a Part D prescription drug plan
  • Switch Medicare Advantage plans

Here are three key changes you should know about as you begin to compare plans for 2020.

1. Medicare has a newly designed Plan Finder

The Medicare Plan Finder is the tool that most Medicare beneficiaries use to shop and compare plans. The Plan Finder was updated to modernize the way that beneficiaries shop for Medicare Advantage and prescription drug plans. The updated tool features a mobile friendly and easy-to-read design, ability to compare up to three drug or health plans side-by-side, and a description of supplemental benefits in Medicare Advantage plans.

Be sure to allow yourself some extra time this year to first learn to navigate the updated Plan Finder before beginning the selection process. The Centers for Medicare & Medicaid Services (CMS) recommends that you set up a MyMedicare.gov account. This will allow the site to pull information from your Medicare file (i.e., current plan information, prescriptions filled, subsidy levels) to generate more customized list of plan choices.

2. The Medicare Part D coverage gap has closed (sort of)

Once people with Medicare cross a certain threshold in spending on their medications, they approach what was called the coverage gap or “donut hole.” In 2020, the Medicare coverage gap will close. But that doesn’t mean you pay nothing for medications once you cross that threshold. A closed coverage gap means that Medicare beneficiaries will have a 25 percent copayment/coinsurance for both generic and brand-name drugs from the beginning of the plan year (after paying any applicable deductible) until they reach the 2020 annual out-of-pocket spending limit of $6,350, after which they pay 5 percent of the drug cost.

This out-of-pocket spending limit is significantly higher than this year’s limit, which is $5,100. That’s a key reason why it is important to shop around and compare prices; switching plans can sometimes results in savings of hundreds, if not thousands, of dollars on out-of-pocket drug costs.

3. Some drug formularies may be indication-based

Every Medicare health and drug plan has a formulary, or approved list of drugs the plan covers. In 2020, both Medicare Advantage and Part D prescription drug plans may choose to restrict on-formulary coverage of drugs to specified indications. For example, a drug may be FDA-approved for both Crohn’s disease and plaque psoriasis, but the Part D plan will include it on the formulary only for plaque psoriasis. That means a patient with Crohn’s would not automatically have that drug covered, although the plan must ensure that there is another therapeutically similar drug included on the formulary for the non-covered indication.

When choosing a plan, you should ask whether your plan is utilizing indication-based formulary and if one of your drugs will be affected by the restrictions. Information on indication-based formulary design must disclose in the Plan’s Annual Notice of Change (ANOC) and Evidence of Coverage (EOC) documents and on Medicare Plan Finder.

If you’re unsure about your Medicare coverage and want to get unbiased advice, contact your local State Health Insurance Assistance Program (SHIP). SHIPs are federally funded to provide no cost, objective assistance to people with Medicare and their families. Find your SHIP at www.shiptacenter.org or by calling 1-877-839-2675.

If you’re having trouble affording your prescriptions or healthcare, you may want to see if you qualify for help with your costs. NCOA’s BenefitsCheckUp® is the nation’s most comprehensive, free online screening tool for thousands of programs that can help pay for medicine, healthcare, food and more. Visit www.BenefitsCheckUp.org.