Medigap Premium Increases – Why and What To Do
What Can I Do When My Medigap Premium Increases?
Every year insurers notify Medigap customers of pending Medicare premium increases.
In fact, increases of 10-to-20 percent were common according to a recent report from the American Association for Medicare Supplement Insurance.
When you are notified that your Medigap premium will increase you can take steps. We explain them below.
Why do Medigap insurers raise your premiums?
You Are Older: As policyholders age, their healthcare needs change. They typically increase.
This leads to higher claims costs for Medigap insurers. Most Medigap plans use an attained-age rating system. This means that premiums will rise as the insured individual gets older.
For instance, if you enroll in a plan at age 65, your premium starts at a certain rate. Then it gradually increases as you age. Thus it costs more at 69. And it will cost more at age 75.
Inflation and Rising Healthcare Costs: Healthcare costs generally rise due to inflation and other economic factors. Insurers adjust their premiums annually to account for these rising costs, ensuring that they can continue to provide coverage without incurring losses.
Changes in Medicare Costs: Annual adjustments in Medicare deductibles and related expenses can also prompt insurers to increase Medigap premiums. As Medicare itself changes its cost structure, insurers may need to adjust their rates accordingly.
Rate Actions: Insurers can request permission from state insurance commissioners to raise premiums (“Rate Actions”).
This happens when an insurer determines that the premiums collected are insufficient to cover the medical claims being submitted by policyholders. If approved, this can lead to significant increases in premiums across all members of that specific plan.
Market Competition: The competitive landscape of the insurance market can influence how much an insurer raises its premiums. If one company raises its rates significantly, others may follow suit to maintain profitability while still attempting to attract new customers.
Read the 2024 Medigap Premium Increases report published by the Association (June 20, 2024).
https://medicaresupp.org/rate-increases-vary-according-to-new-analysis/
TIPS: What To Do When Your Medicare Supplement Premium Increases
Review Your Current Medigap Plan and Your Specific Healthcare Needs
- Begin by reviewing your current Medigap plan.
- Do you have Plan F or Plan G (the two most common choices among those first signing up).
- Evaluate your medical needs. Did you see many doctors over the past year.
- Have you had any hospital stays?
- Think about future needs. You are older. Do you anticipate needing more medical care in the years ahead?
Connect With A Local Medigap Insurance Agent
- Medicare is NATIONAL. But Medigap rules can be STATE specific.
- Most important, available Medigap policies can be LOCAL.
You want a local Medicare agent who specializes in Medigap plans. Why local? Because there may be special rules in your STATE that allow you to more freely switch without health qualifying. Secondly, because they’ll know which Medigap insurers offer plans locally. Thirdly, they should know which plans have larger or smaller rate increases.
USE THE ASSOCIATION’s FREE ONLINE DIRECTORY TO FIND LOCAL MEDIGAP AGENTS. Just click and enter your Zip Code.
Click to find Medigap Plan G insurance agents near me
More Tips To Find Best Medigap Plan Coverage and Costs
Compare Other Medigap Plans – For Example Plan G or Plan N
- Research and compare other Medigap plans available in your area. Since premiums can vary significantly between different insurers for similar coverage, it’s essential to explore options that may offer better rates or benefits that suit your needs.
Check for Guaranteed Issue Rights – or Special Medicare Birthday Rules Available In Your State
- Determine if you have any guaranteed issue rights that allow you to switch plans without undergoing medical underwriting. This is particularly relevant if you are within your 6-month open enrollment period or qualify under specific situations where an insurer cannot deny coverage.
Get Everything in Writing and Keep Documentation
Verbal statements are meaningless if you want to contest them in the future. Get everything in writing. Emails are sufficient.
Maintain copies of all correspondence related to your Medigap policy. Firstly this includes notices of premium increases. Secondly, any communications with insurers. Finally this documentation may be necessary if you decide to apply for a new plan under guaranteed issue rights.
Monitor Future Increases
After taking action, continue monitoring any future increases in premiums. Because you’ll be older, reassess your options annually. It can be important to take advantage of the Medicare Annual Election Period (AEP) or when significant life changes occur.
Medicare Insurance Information Statistics Resources
Access relevant Medicare insurance statistics and information using these links.
Another key report to check is the 2024 Medicare Supplement Price Index – PLAN G. See the lowest and highest premium rates for top-10 U.S. markets.
Secondly compare PLAN N Price Index rates. Lowest and highest rates for top-10 U.S. cities.
Especially research ways to find the best Medicare insurance plan.
Likewise valuable info is our Medicare Supplement insurance statistics – what plans people turning age 65 choose.
Finally, latest info to help you find the best Medicare Plan G for 2025.
Lastly find best long-term care insurance costs – free insurance quotes.