Each fall, many people with Medicare receive an important letter called an Annual Notice of Change, often shortened to ANOC. It explains changes to your Medicare Advantage plan or Medicare Part D prescription drug plan for the next calendar year.
It may be tempting to set this letter aside with the rest of your mail. But reviewing it can help you avoid surprises with your doctors, prescriptions, premiums, or out-of-pocket costs in the year ahead.
Your plan can change from one year to the next, even if you do nothing. That does not always mean you need to switch plans. Still, it is generally wise to understand what is changing and decide whether your current coverage still fits your needs.
What is a Medicare Annual Notice of Change?
The Annual Notice of Change is a document sent by your Medicare Advantage plan or stand-alone Part D drug plan. It compares your current plan benefits and costs with what the plan expects to offer next year.
Plans generally mail or make this notice available by the end of September. It covers changes that take effect on January 1 of the following year.
If you have Original Medicare with a Medicare Supplement insurance policy, also called Medigap, you may not receive an ANOC for the Medigap policy itself. Medicare Supplement plans are standardized differently from Medicare Advantage and Part D plans. However, your Medicare Supplement carrier may send a separate renewal notice about premium changes or other policy information.
You may still receive an ANOC if you have a stand-alone Part D plan along with Original Medicare and a Medicare Supplement plan.
Why should you read your ANOC?
Medicare plans can adjust their premiums, deductibles, copays, provider networks, drug formularies, and coverage rules each year. A plan that worked well this year may still work well next year. But even one change could matter if it affects a prescription you take or a doctor you see regularly.
For example, your Part D plan may move one of your medications to a different cost level, called a tier. This may change what you pay at the pharmacy. A Medicare Advantage plan may also change which doctors, hospitals, or pharmacies are in its network.
Your ANOC gives you time to review these changes before the Medicare Annual Enrollment Period, which runs from October 15 through December 7 each year.
What should you look for in the notice?
You do not need to read every page all at once. Start by looking for the sections that compare this year with next year. Focus on the items that could affect your budget, prescriptions, and access to care.
- Monthly premium: Check whether your plan premium is increasing, decreasing, or staying the same.
- Deductible: Review what you may need to pay before the plan begins sharing certain costs.
- Doctor and hospital network: If you have a Medicare Advantage plan, check whether your preferred providers will remain in-network.
- Prescription drug coverage: Review whether your medications are still covered and whether their tiers, restrictions, or pharmacy rules have changed.
- Copays and coinsurance: Look at costs for doctor visits, specialists, hospital care, urgent care, and other services you use.
- Maximum out-of-pocket amount: Medicare Advantage plans have an annual limit on certain covered medical costs. Review whether that limit is changing.
- Extra benefits: Dental, vision, hearing, transportation, fitness, or over-the-counter benefits may change from year to year.
Benefits, provider networks, drug coverage, and premiums can vary by plan, carrier, county, and state. A change that seems small on paper may be more important for one person than another.
What if your prescriptions are changing?
Prescription drug changes are one of the biggest reasons to review your coverage each fall. A plan may still cover your medication but place it on a different tier. It may also add rules such as prior authorization, step therapy, or quantity limits.
Prior authorization means the plan may need to approve a medication before it will cover it. Step therapy means the plan may ask you to try a lower-cost medication first in some situations. A quantity limit may restrict how much of a drug you can receive at one time.
It can help to make a current list of your prescriptions, including the drug name, dosage, and how often you take it. Then compare that list with your plan’s drug coverage for the coming year. Also check your preferred pharmacy, because pharmacy networks and pricing can change.
Do you need to change plans if you get an ANOC?
Not necessarily. Receiving an Annual Notice of Change does not mean your plan is ending or that you must make a change. Many people look over the notice, confirm their doctors and medications are still covered, and keep their plan for another year.
However, you may want to compare other options if your premium rises, your medication costs change, your providers leave the network, or your health needs have changed. The Annual Enrollment Period may allow you to change Medicare Advantage plans, move from one Part D plan to another, or make certain changes between Medicare Advantage and Original Medicare.
If you are considering leaving Medicare Advantage and moving to Original Medicare with a Medicare Supplement plan, timing and medical underwriting can be important. In many states, you may need to answer health questions when applying for a Medicare Supplement plan unless you qualify for a guaranteed-issue right. It can be helpful to understand your options before dropping your current coverage.
What if you have Original Medicare and a Medigap plan?
If you have Original Medicare plus a Medicare Supplement plan, your main fall review may be your Part D prescription drug plan. Medicare Supplement benefits are standardized by letter in most states, meaning a Plan G from one carrier generally has the same basic Medicare-covered benefits as a Plan G from another carrier. Premiums, customer service, and available plan options can still vary by carrier and state.
You may also receive a notice from your Medicare Supplement carrier about your upcoming premium. A premium increase does not automatically mean switching is the best choice. Depending on your health and your state, changing Medicare Supplement policies may involve underwriting and may not be available on the same terms.
What should you do after reviewing the notice?
Keep the ANOC with your Medicare records and compare it with your current health care needs. Ask yourself whether your doctors, hospitals, prescriptions, and budget are likely to fit the plan next year.
If everything still works for you, you may not need to take action. If something important has changed, use the fall enrollment period to explore available choices carefully. Eric can help you review your Medicare Supplement and Part D options at no cost and with no pressure, so you can feel more confident about the coverage you choose.