Medicare Mistakes

The 7 Most Expensive Medicare Mistakes

Medicare decisions can cost you thousands if you get them wrong. The good news? Most mistakes are easy to avoid once you know what to watch for.

Here are the biggest pitfalls and how to steer clear of them.

Mistake #1: Missing Your Initial Enrollment Period

Your Initial Enrollment Period lasts 7 months—3 months before you turn 65, your birthday month, and 3 months after.

Miss this window and you'll face late enrollment penalties that last for life.

The Cost

• Part B penalty: 10% more per year you delayed, for life
• Part D penalty: 1% more per month you went without coverage
• Gap in coverage: You might wait months for coverage to start

How to Avoid It

Mark your calendar 3 months before your 65th birthday. If you're still working with group coverage, get written confirmation from your employer about creditable coverage.

Mistake #2: Choosing a Plan Based Only on Premium

The cheapest monthly premium often leads to the highest total costs when you need care.

A $0 premium Medicare Advantage plan might have $7,000+ in out-of-pocket maximums.

How to Avoid It

Calculate total annual costs including premiums, deductibles, and expected out-of-pocket expenses. Use a structured comparison worksheet to estimate costs based on your specific needs.

Mistake #3: Not Checking Provider Networks

Assuming your doctors take Medicare Advantage is risky. Networks change every year, and not all Medicare doctors participate in every plan.

The Consequences

• Out-of-network charges can be 2-3 times higher
• You might have to switch doctors mid-treatment
• Some services might not be covered at all outside of the network

How to Avoid It

Before enrolling, verify your doctors are in the plan's network. Confirm with the plan and your provider's office. Re-check annually during Open Enrollment.

Mistake #4: Ignoring Prescription Drug Coverage

Even if you don't take medications now, you need Part D coverage to avoid penalties later.

The Part D late enrollment penalty is 1% of the national base premium for each month you go without coverage.

Example Penalty Calculation

If you delay Part D for 2 years (24 months):

• 2025 base premium: $37.20
• Penalty: 24% of $37.20 = $8.93 per month
• Total penalty: $107 per year, for life

How to Avoid It

Enroll in a Part D plan during your Initial Enrollment Period, even if you don't take medications. Choose the lowest total cost option (premium + expected copays) if you're healthy.

Mistake #5: Waiting Too Long for Medigap

You have a 6-month window after enrolling in Part B to buy any Medigap plan without medical underwriting.

Wait longer and insurance companies can deny coverage or charge higher rates based on your health.

The Risk

If you develop health problems and want to switch from Medicare Advantage to Original Medicare + Medigap, you might not be able to get coverage.

How to Avoid It

If you think you might want Medigap coverage, buy it during your 6-month open enrollment period. You can always cancel later if you change your mind.

Mistake #6: Not Reviewing Coverage Annually

Medicare plans change every year. Your drugs might move to different tiers, doctors might leave networks, and premiums might increase.

What worked last year might be expensive or inadequate this year.

Annual Changes to Watch For

• Drug formulary changes
• Provider network updates
• Premium and cost-sharing adjustments
• Benefit modifications

How to Avoid It

Review your coverage every October during Open Enrollment. Read the Annual Notice of Change your plan sends. Run a side-by-side comparison against last year's expected costs.

Mistake #7: Believing Medicare Covers Everything

Medicare has significant gaps. Without supplemental coverage, you could face thousands in out-of-pocket costs.

What Medicare Doesn't Cover

• Dental care (except emergency situations)
• Vision care (except after cataract surgery)
• Hearing aids
• Long-term care
• Care outside the United States

How to Avoid It

Understand Medicare's limitations before you need care. Consider supplemental coverage for the specific gaps that matter to you.

Mistake #8: Making Emotional Decisions

Healthcare decisions are emotional, but Medicare choices should be based on facts and numbers.

Don't choose a plan because your neighbor loves it or because the sales person was nice.

How to Avoid It

Create a checklist of what matters most to you:

• Keeping your current doctors
• Predictable monthly costs
• Prescription drug coverage
• Extra benefits like dental or vision

Rank plans based on how well they meet your priorities, not emotions.

Mistake #9: Not Getting Help When Confused

Medicare is structured and rule-based. Trying to piece it together without a framework can lead to costly mistakes.

You can use internal checklists, question lists, and comparison worksheets to stay organized.

Where to Get Help

• Internal guides: Quick refreshers on enrollment windows, plan types, and penalties
• Plan summaries: Compare benefits, networks, and projected total costs
• Medication list: Keep dosage and frequency updated for drug comparisons
• Annual checklist: Dates, doctors, drugs, and budget targets

How to Avoid It

Don't be embarrassed to ask questions. Everyone finds Medicare procedural at first. Validate key details (costs, networks, drug tiers) against plan documents.

Mistake #10: Assuming You Can't Change Your Mind

Many people think they're stuck with their first Medicare choice. That's not true.

You can change plans during Open Enrollment every year. Some situations qualify for Special Enrollment Periods.

When You Can Make Changes

• Annual Open Enrollment: October 15 - December 7
• Medicare Advantage Open Enrollment: January 1 - March 31
• Special Enrollment Periods: For qualifying life events

Remember: The biggest Medicare mistake is not taking action. Missing deadlines and not reviewing your options annually can cost thousands.

Creating Your Medicare Action Plan

Avoid these mistakes by being proactive:

1. Mark important dates on your calendar
2. Create a list of your current doctors and medications
3. Set aside time each October to review your options
4. Keep important Medicare documents in one place
5. Build a relationship with a trusted advisor

The Cost of Waiting

Medicare mistakes compound over time. A small penalty today becomes a large expense over 20+ years of retirement.

Take the time to understand your options now. Your future self will thank you for making informed decisions today.