Medicare Mistakes Costing Retirees Thousands Every Year | The Limitless Retirement Podcast

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Danny Gudorf discusses the complexities of Medicare and the importance of reviewing plans annually. He outlines three main reasons retirees may be overpaying for Medicare: changes in health situations, changes in medications, and not taking advantage of open enrollment. He emphasizes the need for retirees to actively manage their Medicare plans to avoid unnecessary costs and integrate Medicare into their overall retirement strategy.

The Hidden Cost of Staying on the Wrong Medicare Plan — And How a Simple Annual Review Could Save You Thousands

Most retirees don’t realize their Medicare plan may be quietly draining hundreds—or even thousands—of dollars every year.

You’re getting the calls. The mailers. The endless commercials.
Every fall, Medicare season turns into a wall of noise—convincing you to switch, upgrade, downgrade, or overhaul your plan. And if you’re like most retirees, the instinct is simple: tune it out and stick with what you’ve got.

But here’s the truth almost no one talks about.

The Medicare plan that seemed like the perfect fit when you enrolled could now be one of your biggest unnecessary expenses. Not because you chose poorly, but because everything changes—your health, your medications, and even the plans themselves.

And those changes?
They could be costing you significantly more than you realize.

In this article, you’ll uncover why so many retirees overpay for Medicare, the three most common warning signs your plan may no longer fit, and why the timing of your review matters more than anything else. Above all, you’ll discover how a few intentional choices each year could help you keep more of your money where it belongs—supporting your life, not disappearing into avoidable healthcare costs.

The Silent Problem Draining Retirement Budgets

Here’s the hard reality: Medicare isn’t static.

Plans reshuffle their networks, adjust premiums, modify coverage tiers, and redefine formularies every single year. Meanwhile, your health and your needs evolve too.

This creates a dangerous disconnect.
A plan chosen for who you were may not be aligned with who you are today.

And for many retirees, this single mismatch becomes one of the most expensive oversights in their entire retirement plan.

Insight 1: Your Health Has Changed—But Your Medicare Plan Hasn’t

When you first enrolled in Medicare, you made the best choice based on your health at that moment.

Maybe you were taking minimal medication.
Maybe your preferred doctors were in-network.
Maybe you needed more robust coverage for ongoing health issues.

But life shifts.

Your health needs shift.

Doctors move, networks update, and the coverage that once fit perfectly may no longer support your reality.

Consider a scenario many retirees face:

A Medicare Advantage plan that initially offered a comprehensive doctor network slowly loses key providers.


Your primary care doctor changes systems.

A specialist stops accepting your plan.

You don’t notice until an unexpected bill arrives—one that’s significantly higher because the visit was out-of-network.

This isn’t unusual. And it’s not your fault.

It’s simply what happens when plans evolve and you’re not reviewing them regularly.

The key question isn’t what your plan used to cover.

It’s: Does it still meet your needs today?

That single question alone could uncover hundreds of dollars in unnecessary expenses every year.

Insight 2: Your Medications Change. Your Part D Plan Must Change With Them.

Prescription coverage under Medicare Part D shifts more often than most people realize.

Every year, Part D plans update:

  • Premiums

  • Deductibles

  • Drug tiers

  • Formulary lists

  • Out-of-pocket pricing

Even if your medications stay exactly the same, your costs may not.
And if your medications do change, the price difference can be immense.

Here’s where retirees often get blindsided:

A drug that used to be affordable moves to a higher tier—without warning—and suddenly your monthly cost balloons.
Or a new prescription isn’t covered well under your current plan but is covered substantially better under another available plan.

This isn’t a minor inconvenience.
For many retirees, prescription changes can impact annual budgets by hundreds—or even thousands—of dollars.

Reviewing your Part D plan each year isn’t just helpful.
It’s essential.

Insight 3: Open Enrollment Is Your Biggest Opportunity—And the Most Ignored

Between October 15th and December 7th, Medicare gives you a rare advantage:
The ability to switch plans without penalties, health questions, or complications.

During this brief window, you can:

  • Move from Original Medicare to a Medicare Advantage plan

  • Change between Medicare Advantage plans

  • Update your Part D prescription coverage

  • Re-align your coverage to match your health needs, providers, and financial goals

Yet despite the flexibility and potential savings, many retirees let this window pass by—simply because the process feels overwhelming.

Too many options.
Too much noise.
Too much uncertainty about what’s truly best.

But here’s the surprising truth:

The time you spend reviewing your coverage during open enrollment could become one of the highest-value hours of your retirement financial strategy.

Not because switching plans is always necessary.
But because knowing whether your current plan still fits gives you clarity—and potentially real savings.

The Often-Ignored Connection Between Medicare and Your Taxes

Medicare choices don’t just affect your healthcare costs.
They also interact with your broader retirement strategy, especially your taxes.

Most retirees aren’t aware of two critical factors:

1. High-deductible plans and HSAs

If you’re still contributing to an HSA before enrolling in Medicare, timing matters.
 A misstep here can limit your HSA benefits.

2. How Roth conversions and income spikes affect Medicare premiums

Your Medicare premium may increase if your reported income crosses certain thresholds.
 This is known as IRMAA—the Income Related Monthly Adjustment Amount.

Here’s the surprising detail:
 IRMAA is based on your income from two years prior.

So a Roth conversion, the sale of a property, or any unusually high income event can quietly increase your Medicare premiums later—long after you’ve forgotten about the original income spike.

This is why Medicare planning can’t be done in isolation.
It must fit within your:

  • Tax strategy

  • Income strategy

  • Long-term retirement goals

When these elements work together, your retirement income can stretch significantly further.

Why Reviewing Your Medicare Plan Each Year Matters

Even small shifts in your plan can create real financial impact over time.

A few of the most common areas where retirees overspend include:

  • Out-of-network charges that weren’t there before

  • Prescriptions that moved to higher-cost tiers

  • Increased premiums that go unnoticed

  • Better-fitting plans available but overlooked

  • Missed opportunities during open enrollment

Each one is small on its own.
Combined over years of retirement?
They add up.

The truth is no one will notify you when a better plan becomes available.
It’s your responsibility to compare your options and make sure your coverage still matches your needs.

But you don’t have to navigate the process alone.

Conclusion

Medicare can be one of the largest expenses in retirement—but it doesn’t have to be one of the most frustrating or costly.

By understanding how your health, prescriptions, and plan options shift each year, and by using open enrollment strategically, you can ensure your coverage stays aligned with your needs and your budget.

Retirement is too important to let outdated choices drain your resources.

A little attention each year could help you keep more of your money—so it can support the life you’ve worked so hard to build.

*This blog post is based on the insights shared by Gudorf Financial Group. For personalized advice tailored to your unique circumstances, always consult a financial, legal, or tax professional.*

Transcript: Prefer to Read — Click to Open


Danny (00:00.098)

Medicare season is here again. And if you’re like most retirees, you’re probably getting bombarded with phone calls, mailers, and TV commercials, all trying to get you to switch plans. It’s overwhelming. And honestly, it’s enough to make you want to just ignore the whole thing and stick with what you’ve got. But here’s what most people don’t realize.

that plan you’re on right now, the one that seemed perfect when you first signed up, it might be costing you hundreds or even thousands of dollars more than it should. Not because you made a bad decision back then, but because things change. Your health changes, your medications change, and the plans themselves change every single year. So if you’re on Medicare right now or you’re getting ready to enroll soon,

I want to walk you through three reasons why you might be overpaying and what you can do about it. Because the truth is a little bit of attention during the right window of time could potentially save you a significant amount of money every single year. Before we get into it, my name is Danny Gudorf I am financial planner and I’ve spent the last 12 years helping people over 50

build retirement plans that actually work for their lives. And if you find this helpful, go ahead and hit that subscribe button so you don’t miss future videos. Now, before we continue, I want to be clear. This is educational information about Medicare planning. The examples I share are for illustration purposes and your results will depend on your specific circumstances, health needs, and location.

I’m not providing individualized advice for your situation in this video. All right, let’s talk about why so many people end up overpaying for Medicare. Reason number one, your health situation has changed, but your plan hasn’t. When you first signed up for Medicare, you probably picked a plan based on where you were at that moment. Maybe you were pretty healthy.

Danny (02:26.561)

So you went with a lower premium plan. Or maybe you had some ongoing health issues, so you chose a plan with better coverage for the doctors and medications you needed at the time. But here’s what happens. Life changes. Your health changes. The medications you take change. And if your Medicare plan doesn’t change with you, you could be paying for coverage you don’t need anymore.

Or worse, you could be stuck with a plan that doesn’t cover what you actually use now. Let me give you a hypothetical example. Imagine a client, we’ll call him Tom, who was on a Medicare Advantage plan that had a great network when he first enrolled. But over the next couple of years, his primary care doctor left the network. And so did the specialist he’d been seeing

for his knee issues. He didn’t realize it until he got a bill that was way higher than he expected because he’d been seeing out of network providers. In this example, when we sat down and reviewed his options, we found a different plan that covered all his current doctors, had lower out-of-pocket costs, and could have saved him about $1,400 a year. Same coverage for what

he actually needed just a better fit for where he was at that point. Now, your situation will be different, but this shows why reviewing your coverage matters. So here’s the question you need to ask yourself. Is your current plan still the right fit for your health situation today? Not three years ago, today. Reason number two, your medications have changed

and your Part D plan hasn’t kept up. This one catches people all the time. Part D is your prescription drug coverage, and every year the plans change. The premiums change, the formularies change. That means the list of medications they cover and how much they cost can be completely different from one year to the next. So even if you’re taking the exact same medications

Danny (04:52.788)

you were last year. Your plan might have moved them to a different tier, which means you’re paying more out of pocket, or maybe your doctor switched you to a new medication and your current plan doesn’t cover it as well as another plan would. Here’s another hypothetical example. Imagine working with a couple. We’ll call them Dave and Sandy and Sandy

was taking a medication for her blood pressure. The first year, it was covered pretty well under her Part D plan. But the next year, that same medication got moved to a higher tier and her copay went from $20 a month to $75 a month. In this scenario, when we reviewed her options during open enrollment, we found another Part D plan that covered

that exact medication at the lower tier. By switching plans, she could have saved over $600 a year just on that one prescription. Again, your medications and available plans will be different. But this illustrates why annual reviews are so important. So if you’re on Medicare and you’re taking any medications, you need to review your Part D coverage every single year.

because the plan that was great last year might not be the best option this year. Reason number three, you’re not taking advantage of open enrollment. Here’s the thing that surprises me. Many people on Medicare don’t review their coverage during open enrollment. They just let it automatically renew and they assume everything’s fine. But open enrollment exists for a reason.

it’s your chance to make changes without any penalties. You can switch from original Medicare to a Medicare Advantage plan. You can switch from one Advantage plan to another. You can change your Part D coverage, and you can do all of this without having to answer health questions or worry about being denied. The open enrollment period runs from October 15th to December 7th.

Danny (07:18.417)

every single year. And if you’re not using that window to at least review your options, you could be leaving money on the table. Now, I get it. The reason most people don’t review their coverage is because it feels overwhelming. There are so many plans, so many options, and it’s hard to know which one is actually the best fit for you. But here’s what I want you to understand. You don’t have to figure this out

alone. There are resources available to help you compare plans based on your specific situation, your doctors, your medications, your budget, and the time you spend reviewing your options during open enrollment could potentially save you a significant amount over the course of your retirement depending on your situation. So it’s worth paying attention to.

Let me share one more hypothetical example. Imagine a client, we’ll call her Cindy, who had been on the same Medicare Advantage plan for five years. She liked her doctors. She liked the coverage. And she just assumed that because it had worked well in the past, it was still the best option. But in this example, when we sat down and reviewed her plan, we found that her premiums

had gone up every year and there was now a different plan available in her area that covered the same doctors, had the same benefits, but cost about $900 less per year. The truth is no one’s going to tell you. It’s your responsibility to review your options and make sure you’re on the right plan. Your results will vary based on your location and circumstances.

But this shows the potential value of reviewing your coverage. So here’s what I want you to do. If you’re on Medicare right now or you’re getting ready to enroll, take some time during open enrollment to review your coverage. Look at your doctors, look at your medications, look at your out-of-pocket costs and compare that to what else is available in your area.

Danny (09:43.976)

because the plan that was right for you three years ago might not be the right plan today. And a little bit of time spent reviewing your options could help you reduce your costs every single year. Now, I also want to talk about something that doesn’t get enough attention. And that’s how Medicare fits into your overall retirement plan because Medicare isn’t just about health coverage. It’s also

about managing your retirement income and your taxes. For example, if you’re on a high deductible health plan and you have a health savings account, there are some strategies you can use to maximize that HSA before you go on Medicare. Or if you’re doing Roth conversions, you need to be aware of how that extra income could push you into a higher Medicare premium bracket.

which is called IRMAA. IRMAA stands for income related monthly adjustment amount. And it’s a surcharge you pay on your Medicare premiums if your income is above certain thresholds. And here’s the thing, ERME is based on your income from two years ago. So if you did a big Roth conversion or sold a property or had any kind of large income spike,

you could be paying higher Medicare premiums two years later without even realizing why. So when you’re planning for retirement, you need to think about Medicare as part of your overall strategy. It’s not just about picking a plan. It’s about understanding how your healthcare costs fit into your income plan, your tax plan, and your long-term goals. And that’s where

working with a financial advisor who understands retirement planning can really make a difference. Because we’re not just looking at your Medicare options in isolation. We’re looking at how everything fits together to help you keep more of your money and live the retirement you actually want. All right, so let’s recap. If you’re on Medicare, here are the three reasons you might be overpaying. Number one,

Danny (12:10.62)

Your health situation has changed, but your plan hasn’t. So make sure your current plan still covers the doctors and services you actually use today. Number two, your medications have changed and your Part D plan hasn’t kept up. Review your prescription drug coverage every year to make sure you’re not paying more than you need to. And number three, you’re not taking advantage

of open enrollment. Use that window from October 15th to December 7th to review your options and make sure you’re on the best plan for your situation. Because here’s the bottom line, Medicare can be one of the biggest expenses you’ll have in retirement. And if you’re not paying attention, you could be spending more than you need to. But if you take the time to review

your coverage and make informed decisions, you may be able to keep more of your money and use it for the things that actually matter to you. Now, before you go, I wanna make sure you’re thinking about the bigger picture. Medicare is just one piece of your retirement plan. To make your money go further, you need to look at how everything works together. Your income sources, your taxes,

and your healthcare costs. So here’s what I recommend. Click on the video I’m putting up on the screen right now. It’s called How to Pay Zero Taxes on Social Security, Six Simple Strategies. If you’re working to reduce your Medicare costs, you should also know how to keep more of your Social Security benefits tax-free. When you combine Smart Medicare Planning,

with smart tax planning, that’s when you really start to see your retirement income go further.

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