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Medicare Annual Notice of Change Explained: How It Affects Your Health Coverage

What Is an Annual Notice of Change (ANOC)?

Medicare’s annual notice of change (ANOC) is a yearly document sent to beneficiaries who have Original Medicare, Part D prescription drug coverage, or Medicare Advantage to inform them of any changes to their plans in the coming year. Medicare issues ANOCs for beneficiaries with Original Medicare (Parts A and B), and individual insurance carriers will send out ANOCs for people with Medicare Advantage (Part C) and Part D prescription drug coverage. 

The annual notice of change is crucial for members to continue receiving their necessary benefits. ANOC letters notify members of any specific changes to their coverage, cost of coverage, or network/service area. Beneficiaries can decide whether to keep their current plan or switch plans during the upcoming annual election period.

Why Does Medicare Send An ANOC? 

Medicare issues ANOCs to enable beneficiaries to decide whether to keep their coverage or choose a different plan. Coverage and costs change regularly and require annual notification by law. Providers also send out evidence of coverage (EOC) letters to explain existing benefits.

How Does ANOC Work? 

The annual notice of change notifies people with Medicare of upcoming changes to their plan. Medicare beneficiaries may choose to change coverage during the next open enrollment period based on their ANOC. 

Who Receives An ANOC? 

Beneficiaries of Original Medicare, Medicare Advantage, and Part D benefits receive ANOCs. This helps to enable beneficiaries to choose from a wide variety of options to accommodate their specific healthcare needs, whether they receive basic benefits with or without Part D or purchase Medicare Advantage. Medigap recipients do not receive an annual notice of change.

Who Sends An ANOC? 

Medicare issues its own ANOCs for beneficiaries of Original Medicare, as they do not receive benefits through a private insurer. The insurance plan provides individual ANOCs for Medicare Advantage and Medicare Part D plans since members purchase this coverage separate from Original Medicare through a third party. 

What Information Is Contained in the Notice? 

While actual updates vary by plan, a typical ANOC may contain information including:

  • Deductible increase
  • Premium increase
  • Copay/coinsurance increase
  • Formulary changes (certain medications no longer covered)
  • Network changes (certain doctors no longer in-network)
  • Authorization changes (certain medications now need special approval)
  • Referral changes (some types of care now require referrals)

Beneficiaries who choose to switch plans may refer to their EOC and ANOC letters to compare new policy options, preferably narrowing their list to only plans with high Medicare star ratings. The star rating system assigns a “score” of 1-5 stars based on the performance of Medicare plans. Star ratings are issued annually before the election period begins in October. 

When Is An ANOC Sent? 

Medicare requires providers to send out ANOCs by September 30, or 15 days prior to Medicare’s annual election period, which begins in October. This gives beneficiaries time to decide whether to keep or switch their Medicare coverage for the following year. You should contact your provider directly if you do not receive your ANOC by September 30.

How Is This Notice Different From Other Kinds of Medicare Communication? 

Medicare issues multiple letters and notifications throughout the year. Outside of ANOCs and EOCs, Medicare regularly sends out communications, such as deemed status notice letters, which notify beneficiaries if they are eligible to receive extra help with Part D coverage. Additionally, Medicare issues handbooks and summary notices of recent claims and statements, which can be mailed and/or accessed in digital form online. 

What You Can Do If Medicare Changes Your Plan 

The annual notice of change exists primarily to provide Medicare recipients the time and resources to change their plan if necessary. Follow the steps below to change your plan after reviewing your ANOC based on your type of Medicare benefits.

Original Medicare 

  1. Review your ANOC from Medicare for any changes to your Part B deductibles or premium costs, coverage of services you regularly use, or your in-network doctors.
  2. Consult a licensed Medicare broker or agent to help you compare plans if you decide to make a change in the new year. You may need to purchase a Medicare Advantage plan for additional benefits and/or add Part D benefits. 
  3. You can change your Original Medicare plan via phone or online during the annual fall open enrollment period, from October 15-December 7. Your new coverage goes into effect on January 1.

Medicare Advantage 

  1. Since private insurers can set their own rates and coverage for Medicare Advantage plans, you may find significant changes noted in the ANOC that affect your out-of-pocket costs, such as increased copays or deductibles. Medicare Advantage plans may also have reduced their provider network or stopped covering a prescription you need. Review your ANOC for these and other critical changes.
  2. Beneficiaries can compare Medicare Advantage plans on the website of the Centers for Medicare & Medicaid Services (CMS). You should note each plan’s Medicare star rating — which ranks its quality and performance from 1-5 stars — to assist in making your choice.
  3. Medicare Advantage beneficiaries enjoy a specific open enrollment period from January 1-March 31. Your coverage takes effect on the first day of the month following the month you enroll.

Medicare Part D

  1. Whether you have Original Medicare with a standalone Part D plan or Medicare Advantage with Part D coverage, certain changes listed in your ANOC may require you to switch plans. Common examples include your plan discontinuing coverage of a medication you need or excluding a preferred pharmacy from your service area.
  2. You may choose to contact a licensed Medicare agent to discuss upgrading your standalone Part D plan or compare Medicare Advantage plans, including Part D benefits. Medicare uses a star rating system to rank Advantage plans and aid in your research.
  3. You can make changes to your Original Medicare benefits with Part D plan during the annual fall open enrollment period, from October 15-December 7. Alternatively, you can switch to a Medicare Advantage plan with Part D beneficiaries during Part C open enrollment period from January 1-March 31. Though rare, you may be eligible for a special enrollment period for Original Medicare/Part D benefits under certain circumstances.

Putting It All Together 

Medicare and Medicare-approved insurance carriers are required to send out annual notices of change to beneficiaries of Original Medicare, Medicare Advantage, and Part D coverage. Common changes include fluctuating premiums and deductibles, dropped service areas, and formulary coverage changes for prescription plans. Issued in September ahead of the Medicare annual election period, ANOCs give beneficiaries ample time to choose to change their plan.  

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