A key concern among many of those who seek supplemental healthcare coverage on top of that which Medicare provides is “How much is the cost of Medigap?”
Researching for the exact coverage provided by each of the Medigap policies is easy as these are standardized via law to be the same regardless of the state or company offering the policy. However, the cost of Medigap is a little more difficult to obtain and companies normally do not make it public in the interest of client retention and more importantly for business reasons.
The reason why there are no readily available sources on the cost of Medigap is because different companies use different methods to calculate the premium they charge to any specific individual. Likewise, premiums can quickly change without notice depending on the circumstances surrounding the policy. For instance, a 65 year old professional male with no historical record of lifestyle diseases may be charged $270 dollars for a Plan J package if he is in California and $220 if he is in Maine. In the same way, Company A can charge the same guy $250 in Florida while Company B can quote the policy for $210. These situations are common occurrences and help to emphasize the need to properly inquire about prevailing premiums from a variety of companies so that policy owners can pick the cheapest prices for the same coverage. In other words, shop around. The government guarantees you the same coverage on the package you choose regardless of what you pay.
Among the factors that companies use to determine the cost of Medigap policies are location, age, health stats, gender, smoking as an aggravating factor, and even marriage. These factors supposedly take into account one’s susceptibility to diseases and going into the hospital. A supposed healthy 65 year old female who doesn’t smoke and lives in a rural area pays significantly cheaper premium prices than another female of the same age who smokes and lives in Los Angeles. These lifestyle and risk factors factor heavily into premium calculations, particularly when one has been smoking for an extended period, as it carries a lot of risk factors for lifestyle diseases. However, as stated earlier, when choosing a plan shop for the best price since you will be getting the same coverage regardless of the price.
Specific to age which is a primary indicator in the cost of Medigap, companies normally use three methods to determine the price of policies. No-age rated policies price premiums regardless of the age and compute to a lower number over an extended period. By comparison, issue-age-rated policies have premiums calculated based on the policy owner’s age the first time the plan was bought. Subsequent premium increases are adjusted for inflation but age does not become a determinant for the calculation. Lastly, attained-age rated premiums vary every year as you age. These policies have the highest cost of Medigap premiums over the life of the policy and are generally advantageous for policy owners who buy late in their lifetime.
Knowing these details can help you save thousands of dollars over the lifetime of your Medigap policy. Seek the services of a local health officer or a trusted healthcare insurance agent to learn more about the cost of Medigap. Alternatively, there are websites dedicated to comparing prices in your locality so you have a better idea of the cheapest plans available when considering purchasing a Medigap policy. Thanks to today’s technology, some great prices can be found over the internet as compared to local prices.
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