It is Medicare open season. And, let’s face it, nobody has any idea what to do.

The other night, I got a call from a friend who works in the long-term care advocacy world. She will soon turn 65 and is confronting the reality of enrolling in Medicare. She has been doing diligent research and creating detailed spreadsheets. And she is baffled.

Some choice is good. So is competition. But needless complexity is something else entirely. And we know from behavioral science that, faced with too many choices, humans often make poor decisions or …do nothing.

Hence, Medicare—the poster child for choice overload:

The rules

If you have just turned 65, you need to enroll in Part A, even if you still are working and have insurance through your job. If you don’t have employer-sponsored health coverage, you need to decide whether to go with Medicare Advantage managed care (Part C) or with traditional Medicare (Part B), also called original Medicare. If you pick traditional fee-for-service Medicare, you also should choose a Part D drug plan (basic Medicare doesn’t pay for most drugs) and decide whether to buy a Medicare Supplemental   (Medigap) policy to cover costs basic Medicare doesn’t.

If you decide to buy a Medigap policy, you have to choose between 10 different plan designs (lettered A-N). Each letter represents a different benefit package.  And, of course, you need to remember that Medicare Supplemental plans A,B,C, and D are different from Medicare Parts A,B, C, and D.

You could simplify your life and enroll in a Medicare Advantage plan. Because these generally provide comprehensive benefits, including drugs, you won’t need a Part D plan or a Medigap policy. But once you get into MA world, it is hard to get out. You can go back to traditional Medicare, but you may not be able to buy an affordable Medigap policy if you have pre-existing medical conditions.

More rules

Deciding which version of Medicare you want is just the first step. You still need to pick specific insurers.  Where I live, there are 25 Part D plans, 10 managed care plans, and 29 plans that offer, for instance, Medigap F policies. Different carriers offer other policies for other letter plans.

And which plan you choose matters—a lot. The benefits for each letter plan are identical, no matter whose insurance you buy. But provider networks may be very different and so are the premiums. In Maryland, premiums for those Part F plans vary from $151-$344 a month—for identical benefits.

And there is more.

If you are already getting Social Security benefits, you will automatically get Part A and B coverage starting in the month you turn 65. But if you are not yet taking Social Security, you need to sign up for Part A. If you don’t have other insurance, you also need to sign up for Part B during your initial enrollment period, which starts three months before your turn 65 and lasts for three months after. If you don’t sign up in that window, you will owe penalties when you finally do enroll. Congress has been trying to fix this mess but has yet to act.

And more rules

The rules are similar for Part D. If you don’t sign up when you are first eligible, you may owe a penalty.

As long as you are still getting insurance through work or another group policy, you won’t owe a penalty if you wait to enroll in Medicare. But once you lose coverage, you must sign up for Medicare during a special enrollment period or you will have to pay a penalty.

The rules are different still if you are getting individual insurance through the Affordable Care Act health exchanges. In that case you may want to drop your individual coverage and switch to Medicare.

There’s more. What if you have Medicare but want to switch plans?

I won’t even try to describe those rules. Here is how Medicare explains it:

When you first become eligible for Medicare, you can join during your Initial Enrollment Period.

  • If you get Part B for the first time during the General Enrollment Period, you can also join a Medicare drug plan from April 1–June 30. Your coverage will start on July 1.

  • You can join, switch, or drop between October 15–December 7 each year. Your changes will take effect on January 1 of the following year.

  • If you’re enrolled in a Medicare Advantage Plan, you can join, switch, or drop a plan during the Medicare Advantage Open Enrollment Period, between January 1–March 31 each year.

  • If you qualify for a Special Enrollment Period. See the next page.

Medicare tries to explain all this in its Medicare & You handbook. This year’s version is 122 pages long.

Or you can try to sort it out through the website. Or you can contact a counsellor from your local State Health Insurance Assistance Program (SHIP) program.  Or, you can just pour yourself a stiff drink.

Medicare is insanely and needlessly complicated. Different enrollment rules and periods for different plans, complex and restrictive rules for switching plans, and penalties for poor choices all discourage older adults from buying the most appropriate coverage.  They make people like my advocate friend pull out their hair in frustration. And that’s no way to celebrate your 65th birthday.