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FYR032: Medicare: Upcoming Changes and How to Prepare with Joe Grochowski
Medicare is an important part of retirement planning, and for many is a topic that can feel overwhelming—especially with significant changes on the horizon. In our latest video, Joe Grochowski, Senior Wealth Advisor at Vector Wealth Management, breaks down what you need to know about Medicare, upcoming changes, and how to prepare.
Understanding Medicare: The Basics
Medicare is the government’s health insurance program for people 65 and older. It’s made up of four main parts:
- Part A: Hospital insurance (usually premium-free if you’ve worked long enough)
- Part B: Outpatient care, like doctor visits (monthly premium applies)
- Part C: Medicare Advantage, a private plan that bundles A and B, sometimes with extra perks
- Part D: Prescription drug coverage
You’re eligible at age 65, with a seven-month window to sign up (three months before your birthday month, your birthday month, and three months after). Missing this window can result in penalties.
What’s Changing in 2026?
Several important updates are coming, especially for clients in Minnesota:
- UCare Exit: UCare is leaving the Medicare Advantage market at the end of 2025, affecting about 158,000 Minnesotans. If you’re on a UCare plan, you’ll need to select new coverage during the annual enrollment period (October 15 – December 7, 2025) to avoid losing coverage in January 2026.
- Medigap Flexibility: Minnesota is expanding guaranteed issue protections for Medigap (Medicare Supplement) plans in 2026. This means more people can switch plans without medical underwriting—a win for those with pre-existing conditions. However, premiums are expected to rise by about 6% on average.
National Changes:
- Part D drug costs will be capped at $2,100 per year starting in 2026, with no more out-of-pocket costs for covered prescriptions after that.
- Medicare will begin negotiating prices for high-cost drugs, which could lower pharmacy bills.
- Medicare Advantage plans will face tighter rules on extra perks, focusing on real health outcomes.
- Expect increases in Part B premiums and IRMAA surcharges, especially for higher-income individuals.
What Next?
Here are a few key action items to keep in mind:
- If you’re on a UCare Advantage plan, mark October 15, 2025, on your calendar for open enrollment.
- Considering Medigap? 2026 brings more flexibility, but likely higher premiums—start exploring your options now.
- Using Part D? Budget for the new drug cap and check which medications will be covered under negotiated pricing.
- Each fall, review your annual notice of change to stay ahead of updates.
Stay Proactive
Medicare isn’t a “set it and forget it” program. The rules, costs, and your health needs can all change. Whether you’re preparing for your first enrollment or looking to optimize your current coverage, staying informed and proactive is essential.
Stay well balanced!
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All content discussed in our podcasts, videos, or related blog articles are for informational purposes and should not be construed as individualized financial advice.
Opinions expressed herein are solely those of Vector Wealth Management, our staff, and guests. Material presented is believed to be from reliable sources, however, we make no representations as to its accuracy or completeness. All information and ideas should be discussed directly and in detail with your financial advisor prior to implementation of a strategy or investment. This podcast and related content are not intended to render personalized investment advice, nor should it be viewed as an offer to buy or sell, or a solicitation of any offer to buy or sell the securities or strategies discussed.
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Published on 1 month ago