Medicare Supplement Insurance

Choosing the Best Medicare Supplement Insurance

According to the most recent Medicare publications, there are 12 Medicare Supplement Insurance plans. These plans are subcategorized as Plan A – N and sometimes referred to as Medigap insurance. Depending on the state you reside will determine which Medigap plans are available. Medigap plans A through G cover the basic benefits while plans K, L, M and N present a different group of basic benefits for the insured.

While many of the Medicare supplement insurance plans are similar, the premiums vary significantly depending on the company. Knowing how to choose the best Medicare Supplement Insurance and when to select the plan is important not only for your health but your finances as well.

During the first six months of enrollment in Medicare Part B it is important to establish a Medicare Supplement Insurance. This timing is crucial because it is the only time that insurers must accept you on the insurance plan regardless of any pre-existing health conditions or diseases that you may have. A Medigap insurance company cannot turn you down simply because of a pre-existing health condition. The Medigap insurance is important because while Medicare may provide a substantial amount of coverage, it doesn’t cover everything. Where Medicare falls short, the Medigap insurance will pick up.

Financially, Medigap insurance makes sense. In the event that Medicare doesn’t cover all of your healthcare bills, Medigap will. Some individuals opt for Medigap insurance to cover expenses that fall under Medicare, such as Medicare deductibles or annual co-pays. The insurance is helpful and cost effective.

How Premiums are Established for Medigap Insurance Policies

There are three different methods used to determine the premium for Medicare Supplement Insurance policies, such as Medigap. These methods include the following:

1. Age

The premium is set at the time of purchase, and is established based on your age. This premium is commonly referred to as the issue age policy. The premium will not increase as you age but will be pre-set based on your age at the time of purchase. However, the premium may still increase based on Medicare’s adjustments for inflation.

2. Attained AGE

Attained age is different than issue age (which means the premium is established based on the age at the time of purchase) because the premium does increase as person gets older. For people who have just turned 65, the premium is at its lowest and then increases every year, three years or five years depending on the Medicare supplement insurance policy. These Medigap insurance premiums not only increase as a person increases in age, but are also affected by Medicare’s inflation adjustments.

3. Geographic Location

Premiums based on geographic location are typically referred to as community-rated policies. This means that everyone within the same location area pays the same amount for the premium no matter what age the insured is at the time of establishing the policy.

Most Medicare experts and long-term aging professionals recommend an issue age or community-rated policy when choosing Medigap insurance. The premiums may be a bit more in the beginning but won’t consume your finances later on in life when it may become more difficult to pay. It is beneficial to stay informed and learn about your rights as a Medicare recipient.