Financial Planning, Retirement Planning

Impact of Health Care Expenses on Financial Planning - Focus on Medicare Open Enrollment: What You Need to Know

November 13, 2023

By Andi McNamara, CFP®
Vice President, Director of Financial Planning
Washington Trust Wealth Management

This time each year, it’s almost impossible to turn on your television or open your mailbox without being flooded with advertisements from insurance companies about Medicare open enrollment—each claiming to provide the best benefits for you. It can be overwhelming.

Your Open Enrollment Choices

Medicare—the federal health insurance program for individuals aged 65 and older, as well as some younger individuals with disabilities—has four parts: Part A (hospital insurance), Part B (medical insurance), Part C (Medicare Advantage plans), and Part D (prescription drug coverage). Medigap is a supplemental insurance policy sold by private companies that can be used along with Medicare Parts A and B to fill the gaps in their coverage.

Medicare’s open enrollment period (formally known as the “Medicare Advantage and Prescription Drug Plan annual election period”) is designed to allow you to review your Medicare coverage for the following year, ensuring that your plan still aligns with your healthcare and financial needs. During open enrollment, you can make changes to which parts you wish to enroll in and whether to enroll in a Medigap policy. If you’re already enrolled in Medicare, you can make changes to your plan during open enrollment from October 15 through December 7, with changes going into effect on January 1, 2024.

(Note that this differs from your Initial enrollment period, which is the seven-month period that includes the three months before your 65th birthday, your birthday month, and the three months after.)

So which plan is right for you?

During the open enrollment period, it's important to review your current Medicare plan(s), taking into consideration your healthcare needs, prescription drugs, and your financial situation. Think about any changes in your healthcare needs and whether your current coverage meets those needs. For example, you may want to ensure your preferred doctors and hospitals are in-network, and that any prescription drugs you take are covered.

The right plan depends on your own personal goals and needs. Other resources to evaluate include:

Washington Trust Wealth Management Can Help

Your Washington Trust Wealth Advisor helps you plan for your healthcare expenses as part of your long-term financial plan. We put this very important decision into context, including modeling different scenarios to determine how Medicare and Medigap premiums, out-of-pocket costs, health care cost inflation, using Health Savings Accounts, and long-term care coverage can impact your plan.

Connect with a wealth advisor

No matter where you are in life, we can help. Get started with one of our experts today. Contact us at 800-582-1076 or submit an online form.

Contact us

This document is intended as a broad overview of some of the services provided to certain types of Washington Trust Wealth Management clients. This material is presented solely for informational purposes, and nothing herein constitutes investment, legal, accounting, actuarial or tax advice. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. Please consult with a financial counselor, an attorney or tax professional regarding your specific financial, legal or tax situation. No recommendation or advice is being given in this presentation as to whether any investment or fund is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors, or markets identified and described were, or will be, profitable.

Any views or opinions expressed are those of Washington Trust Wealth Management and are subject to change based on product changes, market, and other conditions. All information is current as of the date of this material and is subject to change without notice. This document, and the information contained herein, is not, and does not constitute, a public or retail offer to buy, sell, or hold a security or a public or retail solicitation of an offer to buy, sell, or hold, any fund, units or shares of any fund, security or other instrument, or to participate in any investment strategy, or an offer to render any wealth management services. Past Performance is No Guarantee of Future Results.

It is important to remember that investing entails risk. Stock markets and investments in individual stocks are volatile and can decline significantly in response to issuer, market, economic, political, regulatory, geopolitical, and other conditions. Investments in foreign markets through issuers or currencies can involve greater risk and volatility than U.S. investments because of adverse market, economic, political, regulatory, geopolitical, or other conditions. Emerging markets can have less market structure, depth, and regulatory oversight and greater political, social, and economic instability than developed markets. Fixed Income investments, including floating rate bonds, involve risks such as interest rate risk, credit risk and market risk, including the possible loss of principal. Interest rate risk is the risk that interest rates will rise, causing bond prices to fall. The value of a portfolio will fluctuate based on market conditions and the value of the underlying securities. Diversification does not assure or guarantee better performance and cannot eliminate the risk of investment loss. Investors should contact a tax advisor regarding the suitability of tax-exempt investments in their portfolio.