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Medicare Buyer’s Remorse

Can you help? I am 68 years old and have been on Medicare for three years. I have diabetes and a few other conditions. In the last six months, I was hospitalized twice. I almost had a heart attack when I got the bills. The first one was $1,185 for three days and the second — $1,975 for five days. My friend, also a diabetic, said he doesn’t have any copays for hospitalization. His Medicare insurance covers that.  I am afraid I will land in the hospital again and I don’t want any copays. 

When Jerry turned 65, he enrolled in a zero-premium Medicare Advantage plan. Most Medicare Advantage plans charge a per-day copayment for hospital stays. For Jerry’s plan, that is $325 a day for the first six days. His friend has a Medigap policy, also known as Medicare supplement insurance. This policy carries a monthly premium of $229 but it covers many out-of-pocket costs, including hospitalization.  

Because Jerry has been in the hospital and likely will be again, he does not want to face huge out-of-pocket costs. However, there is not much he can do about that now.  

Medicare grants a 12-month trial period for those who elect Medicare Advantage when first eligible for Medicare at age 65. At any time during that period, a beneficiary has a guaranteed issue right.  He or she can switch back to Original Medicare and purchase a Medigap policy, without regard to health status. However, in most states, once that trial period is over, the guaranteed issue right is gone. Anyone wanting to switch from Medicare Advantage to Original Medicare and get a Medigap policy would likely go through medical underwriting. (There are a handful of states that grant Medicare beneficiaries a guaranteed right to get a Medigap policy at other times. Unfortunately, Jerry does not live in one of those.)  

There are three things Jerry can do.

  • He could apply for a Medigap policy. If he found one that would cover his diabetes and other conditions at a reasonable price, he could drop the Medicare Advantage plan during the Open Enrollment Period or the Medicare Advantage Open Enrollment Period
  • If sticking with Medicare Advantage, he should check out-of-pocket costs for other plans during the Open Enrollment Period. It’s possible that another plan might offer some better options. 
  • He could put away enough money to cover the Medicare Advantage plan’s out-of-pocket limit. The limit on Jerry’s plan this year is $5,500.  Once he hits that, there are no additional charges for Medicare-covered services. 

Jerry says that, at the time he turned 65, he did not know about the out-of-pocket costs or the problems with changing coverage down the road. The lesson for those signing up for Medicare: Carefully consider your decision about which path to take. Know the pros and cons of both types of coverage. At age 65, the lower premiums of Medicare Advantage plans can be attractive; however, if health circumstances change, the out-of-pocket costs can create a challenge, particularly if the person does not know they are coming. 

Learn more about the Medicare Advantage trial period at

Last updated: 08-27-2018