Annual Enrollment is your chance to see how your Medicare coverage is changing next year - and make any necessary changes.
The Medicare Annual Enrollment Period (AEP) occurs every year from October 15 through December 7. This is your yearly chance to make changes to your Medicare coverage. But even if you're happy with your Medicare plan, you should never ignore Annual Enrollment.
With all the mailers, TV commercials, and online ads, ignoring AEP may seem impossible. Unfortunately, the majority of Medicare beneficiaries do just that. And in doing so, they may miss big changes to their Medicare plan – changes that could result in loss of coverage, higher out-of-pocket costs, or both.
Original Medicare Changes Expected in 2023
The Medicare program changes a little every year. Typically, this includes adjustments to your Medicare premiums, but there are also changes to benefits.
Original Medicare includes Part A, hospital insurance and Part B, medical insurance.
Changes to Medicare Part A in 2023
Only around 1 percent of Medicare Part A beneficiaries pay a monthly premium. For those who did not work and pay Medicare taxes the required 40 quarters, the Medicare Part A premium will go up slightly in 2023.
- If you paid Medicare taxes for 30 quarters but less than 40, your Part A premium will be $278 per month in 2023
- Those with fewer than 30 quarters of work history will pay $506 per month for Medicare Part A
The Medicare Part A deductible is also increasing in 2023, from $1,566 to $1,600 per benefit period. You should also expect the Medicare Part A coinsurance to increase next year. As usual, there is no coinsurance for the first 60 days of inpatient hospital care.
- Part A coinsurance for days 61 through 90 will be $400 per day
- Coinsurance for days 90 through the 60 lifetime reserve days will be $800 per day in 2023 (you get an additional 365 lifetime reserve days when you join a Medicare Supplement Insurance plan)
If you need skilled nursing facility (SNF) care in 2023, there is still no coinsurance for the first 20 days. But for days 21 through 100 in an SNF, you'll pay $200 per day.
Medicare Part B Changes in 2023
Nearly everyone has to pay the standard Medicare Part B premium – even if you have a Medicare Advantage plan. The premium for 2023 is jumping to $164.90 (compared to the $170.10 in 2022) - the largest dollar-amount increase in Medicare's history.
When it comes to Medicare Part B, premiums also depend on the Social Security cost of living adjustment (COLA). This limits people who receive Social Security benefits from paying a higher Part B premium increase than the COLA amount. (In other words, if the standard Part B premium goes up by $5 but the COLA amount is only $4, your Part B premium cannot go up by more than $4.)
The projected Social Security COLA for 2023 is 8.7 percent. You'll find full information about the Social Security 2023 cost of living adjustment here.
The annual Part B deductible is $226 in 2023.
Will Medigap Plan C and Medigap Plan F be Available in 2023?
As of January 1, 2020, new Medicare beneficiaries cannot enroll in Medigap Plans C and F. This is due to the Medicare Access and CHIP Reauthorization Act (MACRA), which passed in 2015 to help incentivize Medicare beneficiaries to utilize their benefits more carefully.
These Medicare Supplement plans reimbursed enrollees for the Part B deductible. If you became eligible for Medicare BEFORE January 1, 2020, you may still purchase either plan. If your Medicare eligibility date is on or after January 1, 2020, you cannot.
Even if you can sign up for Medigap Plan C or Medigap Plan F, that doesn't necessarily mean that you should. Premiums tend to increase once a Supplement plan has been discontinued. We recommend Medigap Plan D (instead of Plan C) or Medigap Plan G (instead of Plan F). Many Medigap insurers also offer a high-deductible version of Medigap Plan G, just as they did for Plan F.
Changes to the Income-Related Monthly Adjustment Amount
If you are what Medicare considers a high earner, you may owe the Income-Related Monthly Adjustment Amount (IRMAA).
For over a decade, the high-income bracket remained stagnant at $85,000 (filing single) and $170,000 (married filing jointly). In 2020, CMS and the Social Security Administration (SSA) recognized inflation and raised the threshold to $87,000 and $174,000, respectively. The threshold in 2023 is $97,000 and $194,000, respectively.
Fewer than 5 percent of Medicare beneficiaries pay the IRMAA surcharge.
Changes to Medicare Advantage in 2023
Medicare Part C, more commonly known as Medicare Advantage, must provide all the same benefits you get with Original Medicare. However, most Advantage plans offer additional coverage as well.
The average Medicare Advantage plan premium is expected to be $18 in 2023. However, that number rises when you look only at Medicare Advantage Prescription Drug plans (MA-PD), which average around $40 to $50 per month in 2023. As Part C premiums tend to go down instead of up – even if only slightly – you can expect that amount to remain fairly consistent for 2023.
As of 2021, the 21st Century Cures Act extended Medicare Advantage plan access to people who have end-stage renal disease (ESRD). It was signed by President Obama in 2016.
For ESRD patients who live in a state that gives under-65 Medicare beneficiaries the same Medigap protections as those who age into the program, Original Medicare plus a Medigap plan will probably be less expensive than an Advantage plan. Unfortunately, most states do not offer those protections. In that case, ESRD Medicare beneficiaries will likely benefit from joining an Advantage plan. This is because there is no yearly out-of-pocket maximum with Original Medicare. The maximum out-of-pocket (MOOP) with Medicare Advantage is $8,300. It's worth noting, though, that many Medicare Advantage plans set a lower MOOP than the max required by CMS - and the Original Medicare has no MOOP.
To discover your plan's max out-of-pocket, you need to check with your plan provider.
Medicare Part D Changes Expected in 2023
Medicare Part D provides prescription drug coverage to Medicare beneficiaries. You can get these benefits with either a standalone Medicare Part D prescription drug plan (PDP) or a Medicare Advantage Prescription Drug plan.
Possibly the biggest change for Part D in 2021 was access to insulin for a $35 per month copay. You get this benefit whether you have a standalone Part D or MA-PD plan. In 2023, more Part D plans are expected to offer this benefit.
Additional out-of-pocket costs for Medicare Part D in 2023 are:
- Deductible: $505
- Threshold to reach catastrophic coverage: $7,400
Thanks to the Affordable Care Act (ACA), the donut hole (i.e. the coverage gap) closed in 2020. Please note that the donut hole is not the same thing as catastrophic coverage – you still have a 25 percent copay or coinsurance for covered prescriptions after you meet your yearly deductible and before you reach the catastrophic coverage stage. Before ACA passed, though, beneficiaries had to pay 100 percent of their prescription drug costs between reaching the coverage gap and catastrophic coverage.
How to Handle Medicare Annual Enrollment Like a Boss
Health insurance can be confusing (to put it mildly). Preparing ahead of time helps you get the best coverage to meet both your needs and budget.
Start by making a list of your current providers and any prescription medications you take. Your provider list should include your primary care doctor as well as specialists, labs, hospitals, clinics, durable medical equipment providers – pretty much any entity you rely on for healthcare.
Next, add expected changes for 2021. Did your doctor recommend a procedure? Tell you that a chronic condition was getting worse? You'll need this information when comparing your options and deciding whether your current coverage will still work for you next year.
Is Your Current Coverage Changing?
If you have a Medicare Part C or Part D plan, you can pretty much always expect it to change from year to year. In September, you should have received two documents from your Medicare plan.
- The Annual Notice of Change (ANOC) details plan changes for the coming year, including coverage, costs, network, and service area.
- The Evidence of Coverage (EOC) provides greater detail about costs and coverage.
Compare the information in these two documents to the list of current healthcare needs you created in the first step.
If you have a Medicare Advantage plan, you can expect providers to enter and leave the plan's network. And if you have Part D coverage, don't forget to check the drug formulary. Just because your prescriptions are on it this year doesn't mean they'll be covered next year. Failure to read your plan's ANOC and EOC does not qualify you for a Special Enrollment Period (SEP). In other words, if you ignore Annual Enrollment, you may be stuck with a plan that no longer works for you in 2021.
Compare Your Medicare Plan Options
Comparing your Medicare plan options is easy with our Find a Plan tool. Just enter your location to start reviewing Medicare plans in your area.
Cost-of-Living Adjustment (COLA) Information for 2023
External Web Link
Medicare Costs at a Glance
External Web Link
21st Century Cures Act
External Web Link
How to Compare Medicare Advantage Plans
Internal Web Link
How to Use the Annual Notice of Change to Rock Annual Enrollment
Internal Web Link
Find a Medicare Plan in your area
It's FREE with no obligation
Speak with a Licensed Insurance Agent
M-F 9:00am-9:00pm | Sat 9:00am-3:00pm EST