Medicare Supplement Insurance Costs
There are several variables that may affect the cost of a Medicare Supplement Insurance plan. Below, we examine some of the most common pricing factors to help you find a quality Medigap policy at a fair price.
4 Things That Can Affect the Price of Your Medigap Policy
1. Medical underwriting
If you enroll in a Medigap plan outside of your open enrollment period, you may be subject to medical underwriting by the insurance company. This means that the cost of your Medicare Supplement Insurance plan may be based on your current health status and medical history.
Underwriting is not permitted for Medicare beneficiaries who sign up during the open enrollment period or those who have a guaranteed issue right. Your six-month Medigap open enrollment period begins as soon as you are at least age 65 and are receiving Medicare Part B benefits. There are some exceptions for people younger than 65 who have qualifying conditions or disabilities.
Insurance companies that sell Medicare Supplement Insurance plans may offer discounts for non-smokers, women, married couples, patients who pay their premiums electronically and more. Any potential discounts are not standardized and will vary based on the insurance provider.
Medigap plans sold in one particular market may be quite different from the same plans sold in another part of the country. For example, Medigap Plan F could be found in San Jose in 2016 for between $135 and $168 per month. But in New York City, the cost of the same Medicare Supplement Insurance plan offering the same basic benefits could range from $218 to $444.
4. Plan type
There are 10 standardized Medigap plan types available in most states (Minnesota, Massachusetts and Wisconsin have different plan options), and each type of plan offers a slightly different combination of basic benefits in nine designated coverage areas. Because the amount of coverage differs from one plan to the next, so too will the cost.
Use the chart below to compare the basic benefits of each type of Medicare Supplement Insurance plan.
Scroll to the right to continue reading the chart
Medicare Supplement Benefits
Part A coinsurance and hospital coverage
Part B coinsurance or copayment
Part A hospice care coinsurance or copayment
First 3 pints of blood
Skilled nursing facility coinsurance
Part A deductible
Part B deductible
Part B excess charges
Foreign travel emergency
* Plan F and Plan C are not available to Medicare beneficiaries who became eligible for Medicare on or after January 1, 2020. If you became eligible for Medicare before 2020, you may still be able to enroll in Plan F or Plan C as long as they are available in your area.+ Read more
1 Plans F and G offer high-deductible plans that each have an annual deductible of $2,370 in 2021. Once the annual deductible is met, the plan pays 100% of covered services for the rest of the year. The high-deductible Plan F is not available to new beneficiaries who became eligible for Medicare on or after January 1, 2020.
2 Plan K has an out-of-pocket yearly limit of $6,220 in 2021. After you pay the out-of-pocket yearly limit and yearly Part B deductible, it pays 100% of covered services for the rest of the calendar year.
3 Plan L has an out-of-pocket yearly limit of $3,110 in 2021. After you pay the out-of-pocket yearly limit and yearly Part B deductible, it pays 100% of covered services for the rest of the calendar year.
4 Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to $50 copayment for emergency room visits that don’t result in an inpatient admission.- Read less
Medicare Supplement Insurance Plan Cost Structures
Another variable that may affect the cost of a Medicare Supplement Insurance plan is your age. There are three main ways in which age may be factored into the cost of a Medigap plan.
Under community-rated Medigap plan pricing, each Medicare beneficiary is charged the same rate, regardless of their age. The cost of the plan will not increase over time as a result of the increasing age of the insured, but costs could increase as a result of inflation.
This type of Medicare Supplement Insurance plan cost structure is based on your age at the time of application. Typically, the younger you are when you purchase the Medigap plan, the less you will have to pay for the plan. Again, these plan costs will not increase due to your age but may increase due to inflation.
Attained-age rated Medigap plan costs are similar to that of an issue-age-rated plan, but the cost will increase as you age. Younger enrollees can generally expect to pay less for the plan initially but will see the costs increase over time due to their age.