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Last chance for open enrollment

By Jennie L. Phipps · Bankrate.com
Tuesday, December 4, 2012
Posted: 1 pm ET

Friday, Dec. 7, is the close of Medicare Open Enrollment for 2012. Health and Human Services Secretary Kathleen Sebelius said Monday that during the first 10 months of 2012, some 2.8 million Medicare recipients have each saved an average of $677 as the result of the doughnut hole shrinking this year -- that's the portion of prescription drug costs that Medicare doesn't cover.

That kind of savings can make a big difference in your retirement planning.

Beyond that, not all Part D prescription drug plans are created equal. The one that is best for you depends on which drugs you take. If you haven't had the opportunity during this year's open enrollment to reconsider your Part D or Part C Medicare Advantage plan that includes drugs, do it today before it's too late. Be prepared to spend some time on this. It's a confusing-but-worthy retirement exercise.

Start by going to Medicare.gov. Have a list of the drugs you take -- or better yet -- the pill bottles in front of you. Type in the drugs along with the dosage, then pick pharmacies you want to consider. That will result in a list of plans. You can sort them in a variety of ways. Lowest to highest cost is a good place to start. I only take one drug, but I found there was a $400 annual difference between the lowest-cost Part D plan and the fifth-lowest cost Part D plan offering the drug I take. And that's in an area where there aren't very many pharmacies.

Other factors may play into your considerations. Medicare assigns all Medicare Advantage and Part D prescription drug plans a star rating, based on a variety of factors that you can find on the Medicare site. Choosing a plan with a rating that is less than three stars isn't a very good idea. There are four-star rated plans available everywhere in the country. Only a few places have plans that are rated five stars. If you can find one where you live, this kind of quality is  worth considering.

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