If you’re currently enrolled in a Medicare Advantage plan, your plan will send you a “Plan Annual Notice of Change” (ANOC) each fall. The Annual Notice of Change is a booklet that explains any changes in your plan’s benefit coverage, costs, or service area that will go into effect in January for the upcoming plan year.
When you get your Annual Notice of Change, you should read it thoroughly and make sure you understand how any changes affect your coverage and costs in the upcoming year.
Which Medicare plans send an Annual Notice of Change document?
If you’re enrolled in a Medicare Advantage plan or a stand-alone Medicare Prescription Drug Plan, you should receive an Annual Notice of Change from each plan.
A Medicare Prescription Drug Plan provides stand-alone Medicare Part D prescription drug coverage for those enrolled in Original Medicare (Part A and Part B). This type of plan is offered through Medicare-approved private insurance companies.
Similarly, a Medicare Advantage plan is offered by private insurance companies approved by Medicare, under the Medicare Part C program. Medicare Advantage plans must offer at least the same coverage that Original Medicare provides (other than hospice care, which is covered under Medicare Part A). Most Medicare Advantage plans also include prescription drug benefits, also known as Medicare Advantage Prescription Drug plans.
However, some Medicare Advantage plans do not cover Medicare Part D prescription drug benefits (such as Medicare Savings Account plans). If your Medicare Advantage plan doesn’t include prescription drug coverage, in some cases you may be able to enroll in a stand-alone Medicare Prescription Drug Plan (PDP). In this situation, you may expect two Annual Notice of Change documents each fall, one from each of your Medicare plans. Learn more about when you may be able to sign up for a Medicare plan.
What kind of information will I find in the Annual Notice of Change?
Oftentimes, your Medicare plan may make changes for the new benefit year (which coincides with the new calendar year), so the costs and benefits in place on December 31 may be different on January 1. You’ll need to understand how any changes may affect you—that is, your costs and coverage for health-care services you’ll get next year if you stay in the Medicare Advantage or Prescription Drug Plan.
Listed below are examples of plan changes that would be discussed in the Annual Notice of Change if they happened:
- The insurance company that sponsors the plan may change the name of the plan.
- The plan may change (increase or decrease) its service area.
- The plan charges for premiums, deductibles, copayments, and/or coinsurance may change, or covered prescription drugs may be switched to different tiers so that your cost sharing changes.
- The plan may modify its benefit design. For example, it may stop or start offering additional prescription drug coverage during the coverage gap (also referred to as the “donut hole”).
- The plan may alter its formulary (the list of drugs it covers) by dropping some prescription drugs or adding others. Keep in mind that a Medicare plan that includes prescription drug coverage may change its formulary at any time. You’ll be notified by the plan if necessary.
- The plan may change the restrictions it places on some prescription drugs (prior authorizations, quantity limits, or step therapy) by lifting them from some medications and placing restrictions on others.
It’s fairly common for Medicare Advantage plans and Medicare Prescription Drug Plans to mail other important information with the Annual Notice of Change. You’re likely to receive in the same packet the Evidence of Coverage (EOC) for the new benefit year. This document describes in detail all of your benefits (not just the changed benefits), benefit limitations and exclusions, your rights and responsibilities, and more. If your Medicare Advantage plan offers Part D prescription drug coverage, you’ll also receive the formulary, or list of covered prescription drugs, for the new benefit year. You’ll get a multi-language insert that explains in other languages how you may get the Annual Notice of Change, Evidence of Coverage and other important plan information in a language other than English. Your packet may also include a Summary of Benefits, provider and pharmacy directories, and the Low-Income Subsidy (LIS) rider (if you’re eligible) — or these documents may be sent to you in a separate mailing. Note: The formulary, pharmacy network and/or provider network may change at any time. You will receive notice when necessary.
When should I expect to get an Annual Notice of Change?
Medicare requires all Medicare Advantage and Prescription Drug Plans to mail the Annual Notice of Change by September 30. This is so you have a chance to review the coverage costs and the benefits that your current plan will have next year before the Annual Election Period (AEP). Also known as the Fall Open Enrollment, this timeframe lasts from October 15 to December 7. During this period, you can make changes to various aspects of your coverage, including:
- You can switch from Original Medicare to a Medicare Advantage plan, or vice versa.
- You can also switch from one Medicare Advantage plan to another, or from one Medicare Prescription Drug Plan to another.
- And if you didn’t enroll in Medicare Part D coverage when you were first eligible, you can do so during the AEP by enrolling in a stand-alone Medicare Prescription Drug Plan (if you have Original Medicare) or a Medicare Advantage plan that includes prescription drug coverage. However, a late-enrollment penalty may apply if you went without Part D and creditable prescription drug coverage (insurance that is as good as the Part D benefit) for 63 days in a row or more.
Look for a package from your plan in the mail in late September or the first week of October. If you haven’t received it by the first week of October, call your plan and request it.
What should I do when I have received and read my plan’s Annual Notice of Change?
During the Fall Open Enrollment, you can compare your current Medicare plan’s cost and benefit details for next year with those of other plans. Once the Annual Election Period gets underway, you can switch plans or make changes that better suit your current health coverage needs, if necessary. Or, you can confirm for your own peace of mind that your current plan looks like it’s going to meet your health care coverage needs for next year.
I hope you now have a better idea of how the Annual Notice of Change works and why this document is so important to review each year. If you would like help finding Medicare coverage and plan options that may fit your situation, please feel free to contact me. To get started, simply click the Get Quotes button to schedule a phone call or to request a personalized email.