Capital InsightsFinancial Planning

Medicare Changes in 2023

As we begin to say goodbye to winter and usher in spring here in Washington, DC, change is often expected, and inevitable. Here at AFM, we have been paying attention to the warming weather and upcoming cherry blossom blooms while also tracking changes of a different kind – those coming to Medicare programs this year.

Some of the biggest improvements in years are set to take effect that may affect the current and future coverage of you or your loved ones. There are several provisions that were signed into law last summer, and we have highlighted a few here that are aimed at allowing people to access their Medicare more easily and without penalties or delays.

As planners, we understand the importance of these reforms and are here to guide our clients and community through this new season.

Reforms to the Medicare Enrollment Process

Medicare enrollment can be a daunting and often complicated process, with many pitfalls that must be navigated carefully to ensure deadlines and cut offs are met. Add in the penalty of facing lifetime fines, coverage gaps, and other consequences, and it can feel impossible! The good news is that a streamlined enrollment process will become effective this year that eliminates the potential for a long wait before care begins, thanks to The Beneficiary Enrollment Notification and Eligibility Simplification (BENES) Act.

The BENES Act provisions seek to close some of the coverage gaps that people face surrounding enrollment in Part A and B of Medicare. The Act also directs the Federal Government to provide advance notice to individuals approaching Medicare eligibility about basic Medicare enrollment rules, filling a long-standing gap in education for older adults and people with disabilities.

According to the bill’s fact sheet, it will seek to eliminate needless multi-month coverage gaps in Medicare by mandating that Part B insurance begin the first of the month following one’s enrollment during both the later months of their Initial Enrollment Period (IEP) and during the General Enrollment Period (GEP). So, beginning this year, if you enroll during the general enrollment period, your coverage will begin the first of the month following your Medicare enrollment. The same coverage timeline will apply should you enroll in the last three months of your initial enrollment period, which formerly carried a two to three-month wait. The Act also created special enrollment periods for Part B for certain exceptional circumstances.

Vaccine Coverage Under Medicare

The Inflation Reduction Act (IRA) has now made all adult vaccines covered under Part D free, without deductibles or copays. Advocates hope this will improve access and participation, particularly with the previously expensive two-part Shingles vaccine (Shingrix), which has been underutilized in the past and has lead to painful and occasionally dangerous conditions.

Lower Drug Prices and Penalties for Drug Makers Taking Advantage

Another change taking effect this year under the IRA that’s worth mentioning involves drug prices. Drugmakers will now pay “rebates” to the government if they impose price increases that exceed the rate of general inflation, effectively assessing penalties to companies hiking prices on patients in need.

The Act highlights specific mandates, such as for patients covered by the Federal Medicare health insurance program not paying more than $35 a month in copays or other out-of-pocket costs for an insulin prescription. The penalties the Act refers to will require drug manufacturers to pay rebates when the prices for drugs increase faster than inflation. In terms of rebates, which will be paid to Medicare, it is hoped they will begin to have a moderating effect on prescription drug costs over time.

Helpful Resources to Navigate Medicare Changes

As these noteworthy improvements make headlines and circulate with lots of technical information, it can be confusing to know where you or your loved ones stand. The Medicare Rights Center offers a free national helpline along with in-depth information about specific topics on their website, Medicare Interactive.  The Center for Medicare and Medicaid Services also updates its newsroom to provide monthly roundups on changes and hot topics, along with official press releases directly from the source.