“Premium” is a major factor that determines the price of Medicare Supplement Plans. If you are running on a budget, you must choose supplemental plans based on the amount you can pay every month. The premium depends on your Medigap plan. Also, it depends on the insurance service provider.
Every state offers 10 types of supplemental plans. The features and benefits of these plans are standardized. This means all states (except Wisconsin, Massachusetts, and Minnesota) offer the same benefits and features.
Always bear in mind that insurance service providers decide on the monthly premiums. This is why your premiums can differ between insurance companies.
For example, Medigap Supplement Plan A from one company can cost more than the policy from another company in a different state. Yet, both the service providers will offer similar benefits and features.
How are Supplement Plans Priced?
As mentioned previously, premiums differ because of the insurance service provider. The healthcare insurance company decides on the premium for each Medigap plan. Most companies decide price based on the following factors:
- Attained age rated plans depend on the beneficiaries’ If you are a young buyer, the plans will be inexpensive. As you age, the premiums are likely to increase. Premiums of Attained-age-rated plans increase with inflation.
- Issue age rated policies are also known as “Entry Age Rated”. These plans depend on the insurer’s age during purchase. Insurers of the same age will be asked to pay the same premium. Issue age rated policies are cheap for younger buyers. Premiums of issue age rated policies increase only with inflation.
- Community-rated policies are also known as “No Age Rated”. As suggested by its name, the policy doesn’t depend on your age. Premiums of community-rated policies increase with inflation and other factors (except age).
Another important factor that influences premiums is “Time”. The ideal time to buy Medigap plans in 2019 is during the Medigap Open Enrollment Period. This period begins after you are 65. If you have guaranteed issue rights, the Medigap Open Enrollment Period lasts for 6 months. During this time, insurance companies cannot deny you a supplemental plan.
Most insurance service providers have rewards and discounts for:
- Couples with two different policies
- People who use NEFT to pay bills
- People who make annual payments
Question the Insurance Company!
If you wish to bag a great healthcare insurance plan at a low price, you must question as many companies as possible. Compare at least three different service providers.