• The Medicare Annual Notice of Change
• Medigap Enrollment + What Are Guaranteed Rights
• Explore Your Medicare Plan Options
• What Is the Medicare “Evidence of Coverage”
• Don’t Ignore the Medicare ANOC
• Wall Street Journal Medigap Story
• HeyMOE
• Boomer Benefits
• Medicare Advocacy Organizations:
  • State Health Insurance Assistance Program (SHIP)
  • Medicare National Helpline
  • Center for Medicare Advocacy
  • Solace: Healthcare Advocates

You may not be on Medicare right now — but chances are, someone you love is. A parent, a spouse, or a friend. And sooner or later, you’ll be making Medicare decisions yourself.

That’s why it’s worth knowing about an important letter that shows up every September in the mail: the Annual Notice of Change.

Most people glance at it, maybe toss it aside, and never think twice.

But with major shifts coming in 2026, ignoring that notice could be a costly mistake. And here’s the thing — that letter is only one piece of the puzzle.

There are three other common Medicare mistakes that trip people up year after year.

Not just mistakes that can cost you a few extra thousand dollars or limit access to important doctors and treatments, but also mistakes that can be catastrophic to a retirement plan.

So, in this episode, I’m going to tackle both sides of the equation.

First, I’ll walk you through the 2026 changes you need to prepare for.

Then, I’ll share the three Medicare pitfalls to avoid, no matter what year it is.

By the end, you’ll know exactly what to watch for, what mistakes to sidestep, and how to feel confident about Medicare—whether you’re already enrolled, preparing for it in the future, or helping someone you care about navigate the system.

The 3 (Biggest) Medicare Mistakes

When you turn 65, you’re faced with two big choices for your Medicare coverage.

The first option is Original Medicare. This is the federal health insurance program made up of Part A, which covers hospital care, and Part B, which covers outpatient medical care. If you also want prescription drug coverage, you’ll need to add a separate Part D plan.

The second option is Medicare Advantage, also known as Part C, and it’s offered by private, Medicare-approved companies. Medicare Advantage plans include everything that Original Medicare covers and usually, but not always, include Part D prescription coverage as well. On top of that, these plans often advertise extra perks—things like dental, vision, fitness, and hearing benefits.

Now, here’s why this decision really matters: the choice you make will directly impact how much you pay out of pocket, which doctors you can see, the quality of your care, and the services available to you.

And while Medicare Advantage plans can look especially appealing—thanks to their low or even $0 monthly premiums and all those extra benefits—they come with trade-offs.

Sometimes those trade-offs are small, but other times they can be significant, or even catastrophic. And unfortunately, they don’t always become obvious until later, when more costly care is needed.

I’ll get into those details shortly.

But before we do, let’s set the stage by looking at the first big mistake retirees often make with Medicare: ignoring the fine print when their plan changes from year to year.

Medicare Mistake #1: Ignoring Your Annual Notice of Change

If you’re enrolled in a Part D prescription plan or a Medicare Advantage plan, every September, you’ll receive a document called the Annual Notice of Change. It’s sent directly by the plan and may come by mail or email, depending on your chosen delivery method.

According to the vice president of eHealth, nearly half of recipients toss this document aside without reading. And honestly, it’s hard to blame them—the annual notice can run 50 pages or more and is loaded with technical details.

But here’s the thing: ignoring it can be a costly mistake, especially in 2026. And that’s because the Annual Notice spells out exactly how your coverage and costs will change in the year ahead.

As Danielle Roberts of Boomer Benefits points out:

“I don’t think I’ve ever seen an Annual Notice that said ‘no change.”

And next year, the changes are expected to be bigger than usual thanks to shake-ups among insurers and rising Medicare costs. In fact, UnitedHealthcare, the nation’s largest Medicare Advantage provider, recently announced it’s dropping plans that affect 600,000 people.

Those kinds of moves—and the ripple effects they create—will show up in the fine print of your coverage, and one of the biggest areas to watch is Part D prescription drug plans.

Because, starting in 2026, all plans will be required to provide access to the ten drugs included in Medicare’s new drug-price negotiation program at the negotiated Maximum Fair Price.

Discounts are expected to range from 38% to as much as 79%, creating meaningful savings for people who rely on them.

But that good news comes with trade-offs. For example, nearly every Part D plan is expected to include a deductible in 2026, with the maximum set at $615.

So, if your plan didn’t have a deductible before, you’ll now be paying more out of pocket the first few times you visit the pharmacy each year.

In addition, monthly premiums are also expected to rise in 2026. L

ast year, the average monthly premium for a standalone Part D plan was $39, and a prior rule that had capped annual premium increases at $35 is being raised to $50. 

And it’s not just premiums and deductibles to pay attention to. The drug list each plan covers can also change. That means a medication you depend on today might not be covered next year, or it could be moved into a higher cost-sharing tier, driving up your costs.

It’s worth noting here, too, that even pharmacies play a role in these changes, since insurers often have “preferred” pharmacies that offer lower prices, so you’ll want to confirm that your local pharmacy still qualifies.

Now let’s turn to Medicare Advantage plans, where changes could be even more noticeable. One of the biggest shifts for Advantage plans will be in supplemental benefits—the enticing extras these plans advertise, like dental, vision, hearing, or even transportation to appointments.

As a result of recent financial pressure, insurers are expected to scale back in 2026.

As Danielle Roberts explains:

“Medicare Advantage plans are going to try to go back to basics. Maybe they used to cover dentures and now they don’t, or maybe the $1,000 annual dental maximum gets reduced to preventive care only.”

We’re also likely to see more Advantage plans move from PPOs to HMOs.

As a refresher, PPOs give you the flexibility to see doctors outside your network, though often at a higher cost. HMOs, on the other hand, restrict you to in-network providers only.

And to make matters worse, some of your doctors or hospitals may no longer be in-network next year, plus monthly premiums for Advantage plans are also expected to rise by about 5%.

Really quick, to avoid any confusion, you might remember me saying earlier that many Medicare Advantage plans advertise $0 premiums, so why am I talking about 5% premium increases.

Well, $0 premiums will still be true and available for some plans, but you’ll want to look closely at what’s included and what’s being reduced. Advertising $0 premiums is a bit like Texas advertising 0% state income tax—they have to make up for that lost revenue somewhere.

For Texas, it’s through higher-than-average property and sales taxes. For Medicare Advantage plans, it can be higher medical cost sharing, higher out-of-pocket limits, or cuts to those supplemental benefits.

So yes, the Annual Notice of Change can feel overwhelming. The good news it that the notice documents all of the key changes in the first few summary pages that you should be able to get through in less than 30 minutes. And if something doesn’t make sense, just know that your insurer is legally required to explain it.

But reading and understanding the annual notice isn’t the final step; you’ll also want to dig into the fine print of the specific plan you’re on or the plans you are considering. A good starting point before contacting a professional is the free tool on Medicare.gov.

After you enter some basic personal information, you’ll see a list of available plans. When you click into the plan details, you’ll notice small hyperlinks on the page that say “limits apply.”

Unfortunately, most people don’t click on these and read further. They assume they’re properly covered, and then they find out the hard way that a service requires prior authorization or isn’t covered at all.

This becomes especially common as people age and need more costly care. What once felt seamless can suddenly turn into a maze of approvals, denials, and delays.

To be extra cautious, I recommend visiting the insurer’s website directly and downloading a document called the “Evidence of Coverage.” It’s a 200-plus page behemoth, but it’s the most complete picture of what you’re really signing up for. And of course, if that feels overwhelming, you don’t have to go it alone.

A fiduciary financial planner who doesn’t earn commissions from selling insurance can help you weigh your options. If you prefer to work with a Medicare broker, just make sure to pair their guidance with your own research on Medicare.gov—or with support from free advocacy organizations, which I’ll link to in today’s show notes.

Put simply, ignoring the Annual Notice of Change and the fine print of your chosen plan could leave you (or your loved ones) with higher costs, fewer benefits, or limited access to care in 2026. Taking the time to read it is one of the simplest ways to protect yourself—and it sets the stage for avoiding the next big Medicare mistake: The Medigap Trap.

Medicare Mistake #2: Falling Into the Medigap Trap

A few years ago, The Wall Street Journal ran an important story that I don’t think received enough attention. The author wrote a story about a man who, at age 65, when he became eligible for Medicare, opted for a Medicare Advantage plan. (Remember, you have two options: Original Medicare or Medicare Advantage.)

So, this man in the story chose option two, the Medicare Advantage plan. Not too long after making this decision, he was diagnosed with prostate cancer, and discovered that the specialists he wanted to see weren’t in his limited network of doctors. 

Wanting more flexibility to see cancer specialists and protection from big looming medical bills as a result, he later he tried to switch back to Original Medicare and also add a Medigap policy.

But because of his diagnosis, every Medigap insurer turned him down. And that’s the catch: outside of very specific windows, Medigap insurers can deny coverage for pre-existing conditions.

Before I explain more about why this happened and how you can avoid ending up in the same position, let me quickly explain what Medigap is. 

Medigap is extra insurance that you can voluntarily purchase from a private insurance company to help you pay for out-of-pocket costs that you may incur. And, in order to buy Medigap, you must be enrolled in Original Medicare.

In other words, insurers cannot sell a Medigap policy to someone with a Medicare Advantage plan—it’s one or the other.

So if you have Original Medicare and you’re worried about covering out-of-pocket expenses in retirement, you can elect to purchase a Medigap policy.

Now, while Medigap coverage may not be for everyone, it is important for everyone to know that if you pass on Medigap when you are first eligible for Medicare, it is not guaranteed that you’ll be able to purchase it in the future.

After your first year of eligibility, insurers can reject Medigap coverage due to pre-existing medical conditions, just like the man in the Wall Street Journal story who was diagnosed with prostate cancer.

The only time period where Medigap insurers cannot reject you, or charge you higher premiums due to pre-existing conditions, is when you first join Medicare at age 65.

More specifically, when you join Medicare at age 65, you have six months from when Part B coverage kicks in to buy a Medigap policy without being rejected.

If you happen to delay Part B past 65, your 6-month window will begin when Part B starts, not necessarily at age 65.

Either way, during this window, you’ll also typically get better pricing and have more options to choose from. After that window, there’s no guarantee that you’ll be able to buy a policy in the future, and options may be limited and or more expensive.

Now, if you’re outside of this six-month window, there are some hyper-specific situations where you are guaranteed to be able to buy a Medigap policy and avoid being denied. These situations are known as guaranteed rights.

One common guaranteed right applies if a Medicare Advantage plan was chosen when first eligible at 65 and, within the first 12 months, you decide to switch back to Original Medicare.

In that case, there’s what’s called a federal ‘trial right’ to buy a Medigap policy without medical underwriting.

However, it isn’t a blanket right to any plan, because the guaranteed-issue options are limited to specific standardized Medigap plans, with the exact choices depending on your situation and your state’s rules.

Now, there are some unique rules and nuances here, as well as other guaranteed rights that you may be eligible for. But instead of trying to cover every possible scenario, I’ll simply link to a couple of good resources in today’s show notes if you want to learn more about Guaranteed Rights, which can again be found by going to youstaywealthy.com/253.

So, once again, Medigap policies aren’t for everyone, but it is important for everyone to understand their rights to purchase one, as well as the potential consequences of skipping coverage during that first year of eligibility.

And while choosing Medigap is a highly personal decision you’ll want to talk through with your trusted advisors, there are three big reasons why it might make sense for you.

First, if you have a solid retirement plan and you’re comfortable paying a bit more in premiums in exchange for the freedom to see any doctor you want—no matter the network or where you live—a Medigap policy can be a great fit. This flexibility is especially valuable if you expect to travel often or spend different parts of the year in different states.

Second, if you like the idea of going directly to a specialist without needing a referral from a primary care doctor, a Medigap policy can give you that freedom.

And finally, maybe the most obvious reason: if you have health concerns or ongoing medical issues and want strong protection from high out-of-pocket costs, Medigap can provide the extra layer of coverage that gives you peace of mind.

Really quick, before we move on, it’s important to clarify that Medigap does NOT provide prescription coverage, so you would still need to purchase a Part D prescription plan if that’s important to you.

Medicare Mistake #3: Auto-Renewing Your Part D Plan

Speaking of prescription coverage, let’s move into the third mistake people make with Medicare: letting your Part D prescription plan automatically renew year after year. 

On the surface, it feels convenient—no extra work, no decisions to make—but the lack of attention can also end up costing you. 

That’s because premiums change. Formularies—the list of drugs each plan covers—change. And even pharmacy networks can change. So even if your medications stay exactly the same year to year, the plan you’re in today could cost you much more next year.

As discussed earlier, while all plans will be required to cover the 10 drugs included in Medicare’s new drug price negotiation program, nearly every Part D plan is expected to include a max deductible of $615 next year. Monthly premiums are also expected to rise by as much as $50. 

So, the first step to avoiding this mistake is not to let your Part D plan auto-renew without reviewing upcoming changes. 

Step two is to use the Medicare Plan Finder during the annual open enrollment period beginning on October 15th to compare 2026 costs, coverage, and details for options where you live.

This free, interactive tool lets you enter your prescriptions and dosages, select your preferred pharmacies, and compare plans. It also ranks them by cost, factoring in premiums, deductibles, and copays.

If you need more hands-on help, your State Health Insurance Assistance Program — known as SHIP — provides you with free access to Medicare experts who can provide guidance and answer questions, but they can’t tell you exactly what plan to get. However, a recent study found that roughly 40% of SHIP requests couldn’t be completed because people didn’t get calls returned.

It’s going to be a busy year for Medicare experts and agencies because so many changes are expected to occur, so don’t wait until the last minute to seek help. 

If you or a loved one is having trouble getting in touch with SHIP, you can also try the National Council on Aging, which has a free helpline.

If you’re willing to fork out a few dollars, there’s also a service called HeyMOE from 65 Incorporated that costs $30 a year and reviews Part D plans to recommend the best ones for you.

Lastly, you can also work directly with your financial planner or an insurance agent who sells Part D plans. 

Just be aware that some health insurance companies have decided not to pay insurance agents to sell certain Part D plans. So if your insurance broker won’t earn a commission from a particular company, they might not recommend its plan, even if it would be your best choice.

So, be careful, and when in doubt, consider working with a fiduciary financial planner who doesn’t get paid to sell insurance and can guide you to the best recommendation.

Before wrapping up today’s episode, one additional mistake many couples make is choosing he same Part D plan. And this is more common than you might think – one spouse does all the research, finds the best plan for them, and the other spouse assumes if it’s good enough for their wife or husband who just did all the research, it must be good enough for them.

But here’s the thing – there are no household discounts with Part D plans. And since most spouses have different prescription needs, it’s usually better for each person to pick their own plan.

Hopefully, it’s clear that Medicare is not a “set it and forget it” program. It requires review, comparison, and sometimes change. But the payoff is worth the time and attention because it typically leads to better coverage, lower costs, and peace of mind knowing you have the right plan in place.

Thank you as always for listening, and once again, to view the resources and research referenced in today’s episode, just head over to youstaywealthy.com/253.

Disclaimer

This podcast is for informational and entertainment purposes only, and should not be relied upon as a basis for investment decisions. This podcast is not engaged in rendering legal, financial, or other professional services.