How do you find the best Medicare Supplement plans? Here are the five things you should know when considering adding Medicare Supplement (also called Medigap) coverage. Tips from the American Association for Medicare Supplement Insurance.
- There are around 30-to-40 insurers offering Medigap plans.
- Each insurer decides what they want to charge. And prices they charge vary significantly.
- Insurers typically offer discounts. These vary as well.
- Costs typically rise each year. It’s smart to ask for a company’s history of rate increases.
- You may be able to switch Medicare Supplement insurers and coverage levels. BUT NOT ALWAYS!
Why is comparison shopping so important? Say you are a male turning 65 and living is Los Angeles (Zip Code 90001). You could pay $155 monthly for Medicare Supplement Plan G coverage. Or you could pay $258 monthly. Same Plan G. Different insurance company.
While Medicare Supplement plans can be identical, prices are not. A female turning age 65 in Atlanta (Zip Code 30313) could pay as little as $119-per-month. Select a different insurer and she’ll pay $321 monthly. That’s $2,424 difference.
This page will help you gain the know how to be a smarter Medigap buyer. Thanks for the interest.
Author: Jesse Slome, Director, American Association for Medicare Supplement Insurance
Reviewed: July 9, 2024
What is Medicare Supplement (aka Medigap)?
Click Here To Find Local Medicare Supplement Brokers
Medicare Supplement insurance, also known as Medigap, is private health insurance that individuals can purchase from private health insurance companies to complement Original Medicare (Part A and Part B).
It helps cover some of the out-of-pocket costs that Original Medicare does not pay for. These include copayments, coinsurance, and deductibles.
Medigap policies are designed to work alongside Original Medicare to provide additional coverage and financial protection for healthcare expenses.
Medicare Supplement insurance is different from Medicare Advantage plans (Part C). Individuals cannot have both types of plans simultaneously.
How Medicare Supplement Works
When a person with Original Medicare receives healthcare services, Medicare pays its share of the approved amount for covered services. Then the individual is responsible for paying their share of the costs.
Medigap policies step in to cover some or all of these out-of-pocket expenses depending on the specific plan purchased.
This can include costs related to hospitalization, doctor’s services, home health care, lab tests, durable medical equipment, and more.
Medigap plans do not include coverage for prescription drugs or dental care. Individuals who want coverage for these services would need to purchase separate plans specifically for prescription drugs (Medicare Part D) and dental care.
Who Is Eligible?
To be eligible for a Medigap policy, individuals must already be enrolled in both Part A and Part B of Original Medicare.
Individuals who are age 65 or older and enrolled in Original Medicare Parts A and B are generally eligible to apply for Medicare Supplement.
Those under 65 who qualify for Medicare due to a disability may also be eligible in certain states. There are specific enrollment periods during which individuals can apply for a Medigap policy without being subject to medical underwriting.
Cost of Medicare Supplement Insurance
The cost of a Medigap policy varies depending on factors such as the type of plan chosen. Most importantly prices vary the insurance company offering it.
Monthly premiums are paid directly to the insurance company providing the coverage. While the core benefits of each type of Medigap plan are standardized across insurers, premiums may differ based on various factors.
What Companies Offer Medicare Supplement Plans?
As of 2024, the following are many of the companies that offer Medigap plans. We list them alphabetically.
- Ace Property and Casualty
- Aflac
- Aetna Health Ins Co
- Allstate Health Solutions
- American Benefit Life
- Anthem Blue Cross
- Bankers Fidelity
- Blue Cross / Blue Shield
- Globe Life
- Guarantee Trust Life
- Humana
- Medico Life and Health Ins Co
- Omaha Ins / Mutual of Omaha
- Nassau Life
- New Era Life
- Physicians Mutual
- UnitedHealthcare Ins Co
- WoodmenLife
What Are The Largest Medigap Insurance Companies?
View the Association’s Medicare insurance statistics webpage for details. We post data for the largest Medigap insurers.
| United Health Group | 4,372,111 | 31.7% |
| Mutual of Omaha Group | 1,359,218 | 9.9% |
| CVS Group (Aetna) | 1,203,716 | 8.7% |
| Health Care Service Corporation | 565,706 | 4.1 |
8 Tips To Shop For The Best Medicare Insurance Plans
Lastly, access the National Directory Listing Local Medicare Insurance Advisors
Here are 8 tips to help you be a better shopper for Medigap plan coverage. Tips shared by expert members of the American Association for Medicare Supplement Insurance.
- Medicare is National. But Plans Choices are Local.
- An ‘agent’ typically sells plans from one company.
- Brokers can sell plans from multiple insurers. But rarely all of them.
- The largest Medigap insurers (names you know) may charge more.
- Discounts can save you money. Some will only apply in the future.
- There’s a reason different Medigap plans exist. (Plans A – N).
- Rates generally increase each year. The important question many fail to ask!
- You may be able to switch in future years. But NOT always. Understand why.
Medicare is National. But Plans Choices are Local.
In Manhattan, New York, seniors basically have 4 insurers offering Medigap Plan G. In Dallas or Chicago there are around 20.
Insurance companies decide where they want to offer Medicare Supplement. If there are just a few insurers, comparing is relatively easy. If there are 20 or more plans, it is virtually impossible to compare them all.
An ‘agent’ typically sells plans from one company.
Insurance has it’s own lingo. An insurance agent generally is only selling plans from one company. That does NOT means it’s a bad thing. The plan they are selling could indeed be your best choice. But asking the following question can help you find out if they sell only 1 or if they sell plans from multiple companies.
Ask; “How many Medicare insurance companies are you appointed with?” Appointed is insurance lingo that means they can sell you plans from that particular company.
They’ll tell you the name of the insurance company they sell. Remember, it could be the best choice for you. But you’ll certainly want to comparison shop.
Brokers can sell plans from multiple insurers. But rarely all of them.
There are ‘agents’. And, there are ‘brokers’. Brokers are appointed with multiple insurance companies. They can sell you plans from any of those companies.
If there are 20 insurers offering Medigap in your city, it’s unlikely a broker will be appointed with them all.
Ask; “How many Medicare insurance companies are you appointed with?”
And, “Can you tell me the names of the Medigap companies you sell the most of?” Write down the names. If you see some major names missing (like UnitedHealthcare, Aetna, Humana, Blue Cross) ask why they don’t sell them.
The largest Medigap insurers (names you know) may charge more.
Each year the American Association for Medicare Supplement Insurance publishes a Medigap Price Index. It reports the lowest and the highest monthly rates for men and women turning 65.
The rates vary significantly.
The Medigap insurance company names you know may have low rates in some cities. In others they have among the highest. No company is always the lowest cost. Neither is one always the highest.
Discounts can save you money. Some will only apply in the future.
Some companies offer discounts. The discounts primarily are for spouses and partners.
They can range from zero to as much as 14%.
Here’s why asking about Medigap premium discounts is important. First, they can save you significant money; hundreds of dollars annually.
But, often the discounts wont kick in until both parties qualify for Medicare. So, it is vital to ask about these discounts. And, how to get them applied when both reach Medicare eligibility.
There’s a reason different Medigap plans exist. (Plans A – N).
Medicare Supplement Plan G is the most popular plan among seniors turning age 65. See what Medigap plans seniors pick.
Plan N can save you money. That’s why it’s today’s second most popular plan choice. It can be ideal for those who rarely see doctors. Or those willing to take the added risk in exchange for the monthly saving in premium costs.
Rates generally increase each year. The important question many fail to ask!
It’s natural to focus on the immediate cost. But your costs for Medigap protection are very likely to increase. Generally not the first or second year. But pretty surely after that.
Ask; “Can you share me the insurance’s company’s history of recent rate increases for Plan “G”?”
You may be able to switch in future years. But NOT always. Understand why.
Lastly, access the National Directory Listing Local Medicare Insurance Advisors
Things change. Do you really expect the policy you buy at age 65 will be the right one when you turn age 75. Or age 85?
Medicare’s rules provide provisions for switching. But insurance companies have their own rules. And, in certain states, the states have special rules. These are often called Medicare Birthday Rules.
Ask the agent or broker you are speaking with what rules will apply if you want to switch insurers or Plans (say from Paln N to Plan G).
Key Medicare Insurance Information Resources
Access relevant Medigap information using these links.
2024 Medicare Supplement Price Index – PLAN G. See the lowest and highest premium rates for top-10 U.S. markets.
PLAN N Price Index rates. Lowest and highest rates for top-10 U.S. cities.
Medicare Supplement insurance statistics – what plans people turning age 65 choose.
Findbest long-term care insurance costs – free insurance quotes.
