Common Medicare Mistakes (And How to Avoid Them)

Medicare mistakes can be expensive, and some are permanent. After helping thousands of people navigate Medicare, we have seen the same errors come up again and again. Here is how to avoid them.

Mistake #1: Missing Enrollment Deadlines

The mistake: Assuming you can enroll in Medicare "whenever" or that deadlines are flexible.

The consequence: Late enrollment penalties that last for life.

• Part B penalty: 10% higher premium for each 12-month period you could have had Part B but did not
• Part D penalty: 1% of the national base premium added per month without creditable coverage

Example: If you delay Part B for 3 years without creditable coverage, you will pay 30% more for Part B premiums for the rest of your life. That is currently an extra $52/month, forever.

How to avoid it:

• Know your Initial Enrollment Period (7 months around turning 65)
• Understand whether your current coverage is "creditable"
• Do not assume employer coverage automatically counts
• Mark your deadlines on a calendar

Mistake #2: Not Comparing Plans Annually

The mistake: Assuming your current plan is still the best option year after year.

The consequence: Overpaying for coverage, losing access to doctors, or paying more for medications.

Medicare plans change every year:

• Benefits increase or decrease
• Premiums change
• Drug formularies update (your medications may cost more)
• Provider networks change (your doctor may leave)
• New plans become available

Example: A client came to us paying $180/month for a Medicare Advantage plan. When we compared options, we found a plan with better benefits and a $0 premium. She was overpaying by $2,160/year.

How to avoid it:

• Review your Annual Notice of Change (ANOC) each September
• Compare your plan to alternatives during Annual Enrollment (October 15 to December 7)
• Check that your doctors are still in-network
• Verify your medications are still covered at reasonable costs

Mistake #3: Missing Medigap Open Enrollment

The mistake: Not enrolling in Medigap during your 6-month Open Enrollment Period, thinking you can do it later.

The consequence: Being denied coverage or paying significantly more based on health conditions.

During your Medigap Open Enrollment Period (6 months starting when you are 65+ AND enrolled in Part B):

• Insurers must accept you regardless of health
• They cannot charge more based on health conditions
• You get guaranteed issue rights

After this window closes, insurers can:

• Deny your application
• Charge higher premiums based on health
• Exclude pre-existing conditions

Example: A healthy 65-year-old chose Medicare Advantage. At 72, after developing heart disease, she wanted to switch to Medigap for better specialist access. Every insurer either denied her or quoted premiums over $500/month.

How to avoid it:

• Understand that this window does not come back
• Consider enrolling in Medigap during your Open Enrollment even if you are unsure
• You can always switch to Medicare Advantage later; the reverse is often impossible

Mistake #4: Choosing Based Only on Premium

The mistake: Selecting the plan with the lowest premium without considering total costs.

The consequence: Paying more overall due to high out-of-pocket costs.

A $0 premium plan may cost you thousands if:

• Your medications are not on the formulary or are in a high cost tier
• Your doctors are not in the network
• The plan has high copays for services you use frequently
• The out-of-pocket maximum is $8,000+

Example: A $0 premium plan might save $150/month in premiums but cost $200/month more in drug copays and specialist visits. That is a net loss of $600/year.

How to avoid it:

• Calculate total expected costs: premiums + expected copays + drug costs
• Compare plans using your actual medications and doctors
• Consider how often you use healthcare services
• Do not forget the out-of-pocket maximum (your worst-case scenario)

Mistake #5: Not Verifying Provider Networks

The mistake: Assuming your doctors are in a Medicare Advantage network, or that networks stay the same.

The consequence: Unexpected bills, having to switch doctors, or paying out-of-network costs.

Provider networks:

• Vary significantly between plans
• Change every year
• May include a hospital but not all specialists there
• Can be confusing (a doctor may be "participating" but not "preferred")

Example: A client enrolled in a Medicare Advantage plan because the hospital was "in-network." She later discovered her surgeon and anesthesiologist were out-of-network, resulting in thousands in unexpected bills.

How to avoid it:

• Verify each doctor individually. Do not assume.
• Call your doctors' billing offices to confirm participation
• Check both the facility AND the providers you will see
• Verify annually, as networks change

Mistake #6: Ignoring Prescription Drug Coverage

The mistake: Focusing on medical coverage while overlooking Part D details.

The consequence: Paying far more for medications than necessary.

Part D formularies are complex:

• Not all drugs are covered
• Covered drugs are in different "tiers" with different costs
• Preferred pharmacies have lower costs than non-preferred
• The coverage gap ("donut hole") can be expensive

Example: Two Part D plans might both "cover" a medication, but one charges $45/month and the other charges $180/month due to different tier placements.

How to avoid it:

• List all your current medications (name, dose, quantity)
• Enter them into Medicare's Plan Finder to compare actual costs
• Consider pharmacy convenience and mail-order options
• Review drug coverage annually (formularies change)

Mistake #7: Not Understanding COBRA and Medicare

The mistake: Staying on COBRA instead of enrolling in Medicare, assuming COBRA counts as creditable coverage.

The consequence: COBRA is NOT creditable coverage. You will face late enrollment penalties.

When you are eligible for Medicare:

• COBRA generally becomes secondary to Medicare
• Delaying Medicare while on COBRA triggers penalties
• COBRA coverage may not even work well without Medicare

Example: A 66-year-old stayed on COBRA for 18 months after leaving work, thinking it was better coverage. When she finally enrolled in Medicare, she faced a permanent 30% Part B penalty.

How to avoid it:

• Enroll in Medicare when first eligible, even if you have COBRA
• Understand that COBRA coordinates with Medicare, not replaces it
• Get professional guidance when transitioning from employer coverage

Mistake #8: Dropping Part B to Save Money

The mistake: Dropping Part B coverage to save on premiums, planning to re-enroll later.

The consequence: Gaps in coverage, late enrollment penalties, and waiting periods to re-enroll.

If you drop Part B:

• You can only re-enroll during the General Enrollment Period (January to March)
• Coverage will not start until July
• You will face permanent late enrollment penalties
• You may lose Medigap coverage (and may not be able to get it back)

How to avoid it:

• Do not drop Part B without understanding the consequences
• If cost is an issue, look into Medicare Savings Programs for premium help
• Talk to an advisor before making coverage changes

Get Help Avoiding Mistakes

Medicare decisions have long-term consequences. A free consultation can help you:

• Understand your enrollment windows and deadlines
• Compare options based on your specific situation
• Avoid the costly mistakes we have seen others make
• Get it right the first time

Schedule Your Free Medicare Review