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Medicare Participants: You Have 10 Days Left to Do This

Every year, Medicare participants have to make decisions about their coverage, and they typically have set time periods during which they can figure out what they'll do for a given year. The regular Medicare open enrollment period runs from Oct. 15 to Dec. 7, and that gives Medicare participants the broadest set of choices to make changes in coverage. However, the Medicare Advantage Disenrollment Period is different from the open enrollment period, and it's currently available to those who are considering whether to keep their Medicare Advantage coverage or not. However, this period ends on Feb. 14, giving participants just 10 days to make their final decisions for 2017.

What is the Medicare Advantage Disenrollment Period?

The Medicare Advantage Disenrollment Period runs from Jan. 1 to Feb. 14 each year. If you're in a Medicare Advantage plan, then you choose to leave the plan during the period and switch back to original Medicare coverage under Part A hospital coverage and Part B medical coverage. You're also allowed to enroll in a Part D prescription drug plan, with the idea that many Medicare Advantage plans include integrated drug coverage, and so participants leaving Medicare Advantage need replacement prescription insurance.

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What am I not allowed to do during the Medicare Advantage Disenrollment Period?

The Medicare Advantage Disenrollment Period is very limited. As its name suggests, its only function is to give participants an opportunity to go from Medicare Advantage back to original Medicare.

Specifically, you're not allowed to switch from one Medicare Advantage plan to another during the period, nor are you allowed to go in the reverse direction from original Medicare to a Medicare Advantage plan. Switches between Part D prescription drug plans are also not allowed. For these moves, the only period available is the regular open enrollment from Oct. 15 to Dec. 7.

Are all Medicare Advantage plans eligible for disenrollment?

No. If you have what's known as a Medicare Medical Savings Account or Medicare MSA Plan, then you're not allowed to drop the plan during the Medicare Advantage Disenrollment Period. Medicare MSA Plans are a form of Medicare Advantage, combining a high-deductible Medicare Advantage plan with a medical savings account into which the plan deposits money toward your healthcare expenses.

When is the switch effective?

Changes that you make during the Medicare Advantage Disenrollment Period take effect on the first day of the following month. Therefore, those who are acting now can expect an effective date of March 1.

Also, it's important to note that if you need to get prescription drug coverage along with the switch, you need to get signed up by the Feb. 14 deadline. That change also takes effect on the first day of the following month after enrolling.

Are there downsides to using the Medicare Advantage Disenrollment Period?

One thing to keep in mind is that Medicare Advantage plans tend to be more comprehensive than original Medicare. In particular, Medicare Advantage plans often make it unnecessary to purchase additional Medigap supplemental insurance coverage, which many original Medicare participants use to supplement their coverage.

If you use the Medicare Advantage Disenrollment Period to switch back to original Medicare, then you aren't necessarily guaranteed the right to sign up for a Medigap policy. Without that coverage, you would be on the hook for the various deductibles and copayments required under Medicare, including the 20% of medical coverage costs that Medicare doesn't pay and the expensive deductibles that can apply to long hospital stays. Some states offer access to what's known as Medigap Select, which can be available even when other Medigap coverage might not be. But you should know your options before you make a final decision.

Using the Medicare Advantage Disenrollment Period is an option for those participants who aren't satisfied with Medicare Advantage and want to return to original Medicare. Just bear in mind that the clock is ticking, and you're running out of time to make a move for 2017.

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