The Medicare open enrollment period has started. There are some issues with the plan assistance tool, Medicare Plan Finder. I think it is worthwhile to go over some general thoughts and decision rules about open enrollment. We’ll talk generally and then specifically for Medicare.
Picking an insurance plan, be it Medicare, be it group insurance through work or individual insurance on the Exchange is tough. It is a cognitively demanding task that has multiple threads of uncertainty pulling your decision processes in conflicting directions.
I would like to consider myself extremely well informed about insurance and benefit design. On this subject, I believe that I’m at least as smart as an average bear looking for a picnic basket. However, I know my limitations. I am very confident that I won’t make a horrendous choice. I am also very confident that I won’t make the optimal choice. And I’m okay with that. When I have to choose an insurance product, I engage in a strategy that minimizes my regret. I’m okay with sacrificing some perfection as long as I know that my eventual choice is at least good enough. The extra two or three or thirty hours of gaming out every potential scenario is not worth the time nor the stress.
How important is access to a particular set of doctors or hospitals? This will be a mixture of your health status and the learning/hassle costs of switching docs. Right now in my life, I am lucky enough to be in good health so I don’t have any investment in a relationship with my primary care provider nor do I have any regular specialist visits. I value those relationships at a fairly low value. My 66 year old mother is a medical zebra. She has a history of weird conditions. She greatly values the team of docs and hospitals that have cared for her needs over the past fifteen years. Switching to a new team would be extremely painful for her.
How much can you afford in a worse case scenario versus how much can you pay out each month? This is a tough trade-off. All else being equal, a higher monthly premium means more protection in a worse case scenario (that is less likely in the ACA as there are an increasing number of gold and silver plans with the same out of pocket maximum as bronze plans but merely take a lot more time/claims to get there). For a given monthly premium, what are you willing to concede to get a targeted level of protection? How important is a cap on exposure?
Insurance can be complex.
Most people don’t spend several thousand hours a year thinking about insurance markets. Some people do. Use those people.
Medicare has decision support tools, navigators and agents. Agents are obligated to give you reasonable advice. The advice does not have to be optimal, but it has to be solid. Use trusted sources to reduce the decision complexity from hundreds of plans to maybe two or three reasonably decent choices given the criteria that you value.
Right now at the start of the open enrollment period, you have time. Medicare beneficiaries will have about seven weeks. ACA individual market enrollees will have a little more than six weeks. Use the early part of the window to quickly discard really bad options and then use the rest of the time to find good advice and expertise to make a not bad choice. Accept that it is unlikely that retrospectively that you will make an optimal choice but be confident that prospectively, you can make a reasonable choice.
Good luck and ask away in comments as weird things come up during open enrollment.