While All Medicare Supplement Plans are the Same, the Price You'll Pay is Not
Weiss Ratings Advises Consumers to Shop Around
When it comes to your retirement health care, combining Medicare Parts A and B with Medicare Supplemental Insurance is one of the best choices you can make.
That’s because Medicare Supplemental Insurance – or Medigap as it’s commonly called – gives you two important advantages.
First, Medigap plans cover most or nearly ALL of the gap between what doctors or hospitals charge and what Medicare pays for. You won’t have to worry about co-pays!
Also, with Medigap plans, you're free to choose your own doctors or to see a specialist whenever you need one. Compare that to Medicare Advantage plans, which restrict you to doctors and hospitals in a network. And you’ll also need a referral to see a specialist.
With Medigap coverage, you're free to go to the clinics or hospitals that are the most convenient for you and will do the best job of taking care of you, without financial worry.
By Federal law, they are all standardized. In other words, every Plan A is the same as every other Plan A, every Plan B is the same as every other Plan B, and so on.
But, while Medigap Plans are the same, the price you’ll pay is not. The same plan can cost hundreds, even thousands of dollars more, each and every year.
This may seem hard to believe, but Weiss Ratings analyzed more than 1 Million premium rates among 173 insurers offering Medigap insurance during 2018 and found that wide disparities in Medigap rates continue to exist for all plans. The national average cost of a Medigap policy for a 65-year-old female ranged from $1,024 to $2,390. Disparities in pricing on specific plans vary even more dramatically; for instance, rates for the popular Plan F varied from a minimum of $1,155 to a maximum of $7,405. The broad ranges in premium rates for Plans A through N are illustrated below:
2018 Medigap Premium Rates1
1Calculations based on a 65-year-old female nationwide, excluding Minnesota, Wisconsin,and Massachusetts, which do not follow the standard A-N plan descriptions. Calculations include all pricing methods.
The vast pricing variations of Medigap policies reflect regional differences in health costs, insurers' underwriting and pricing methodologies, the health status of the target population, and state policies regulating rates. In reviewing the rates for a 65-year-old female, Weiss found the following pricing contrasts:
In Florida, a 65-year-old female may pay $4,470 for Plan C, while a different insurance company issues the same policy for $2,002, representing a 123 percent difference in cost. In Arizona, the same plan ranges from $5,375 to $1,418, a 279 percent difference.
In Rhode Island, premiums for Plan F vary from a low of $1,375 to a high of $4,356, representing a 217 percent difference in cost, while rates in Nevada run from $1,552 to $5,370.
"Even worse, paying a higher premium does not mean you get a better, more financially stable insurer. In fact, many of the highest premiums come from companies with low Weiss Safety Ratings," said Gavin Magor, Director of Weiss Ratings" For example, an insurance company charging the highest premium of $3,146 per year for Plan F has a Weiss Rating of D+. This means the company has significant financial weakness that could result in unpaid claims," advised Magor.
Consumers wanting to explore their options and save money can visit www.weissmedigap.com for a customized Medigap report. This report is a powerful resource that will inform, educate and guide consumers through the Medigap maze and help them pick the plan that is right for them.
You get a complete list of premium rates and plans from ALL Medigap insurance providers based on your age, sex, and where you live.
Plus, your custom guide gives you the Weiss Ratings safety rating for every company. So you can sleep at night, knowing your insurer is solid — and able to pay your claim when you need it.