It may seem counterintuitive, but many Medicare beneficiaries are opting to stay put with their drug coverage despite premiums being at an all-time high. And this gives insurance companies just what they want- a complacent market that makes room for higher premiums.
Everyone has been hit hard by inflation, so why wouldn’t you take advantage of the opportunity to save money on your Medicare insurance? For starters, academic researchers have speculated that during election years, people tend to hold off on spending due to the uncertainty that surrounds these important elections.
Another culprit could be brand loyalty. It is no secret that good marketing can generate lifetime customers, and for a long time, it was implied that the only place to enroll in Medicare insurance was with one specific senior organization- AARP. This led many to tie themselves to AARP, even if they did not share the same left-leaning beliefs. During year 2022, AARP had some of the highest prescription drug plan premiums on the market – about 30% higher than the next comparable plan, according to the Kaiser Family foundation!
“We’re certainly at the point where this AARP (Drug) plan is so expensive that it’s likely that most people in it could save money by switching…But it comes down to brand loyalty” says Juliette Cubanski, co-author of the Kaiser report.
Unfortunately, AARP is not the only one taking advantage of customers who decide to leave well-enough alone. During the past few years, a new pattern has emerged. Consumers enroll in a new low-cost drug plan, only to realize that the premium significantly increases the following year.
Moreover, those who failed to do their research only realized the price hike after the Annual Enrollment Period ended, leaving them with no other option but to keep their high-priced drug plan. On the other hand, there are those who knowingly chose to stay because they couldn’t be bothered changing plans. Both scenarios create opportunities for insurance carriers to slide in higher rates for the following year.
Maybe you have had a wonderful experience with your current carrier, and they have always covered your prescriptions. That’s great, but keep in mind drug plans are subject to change each year. What happens when your plan becomes unaffordable or does not cover your essential medications? Whether you are nervous about upcoming changes or have the “if it’s not broken don’t fix it” mentality, you are doing yourself a disservice by not shopping around for prescription drug coverage annually.
Call a trusted AMAC Medicare advisor to ensure you are not paying more than you have to for your coverage. Our services are always complimentary and there is never any obligation to enroll in a plan.
For help with plans – or any questions you may have about Medicare – contact AMAC’s Medicare Advisory Service at 1-855-611-4856, or request a quote below!
