Medigap premiums can vary widely depending on the insurance company- according to a new study- so be sure to shop around before choosing a policy.
When you first become eligible for Medicare- you may purchase a Medigap policy from a private insurer to supplement Medicare’s coverage and plug some or virtually all of Medicare’s coverage gaps. You can currently choose one of 10 Medigap plans that are identified by letters A- B- C- D- F- G- K- L- M- and N. Each plan package offers a different combination of benefits- allowing purchasers to choose the combination that is right for them. Federal law requires that insurers must offer the same benefits for each lettered plan- so each plan C offered by one insurer must cover the same benefits as plan C offered by another insurer.
When choosing a plan- you need to take into account the different benefits each plan offers as well as the price for each plan. To make things more difficult- the premiums for a particular plan can vary widely- according to an analysis by Weiss Ratings- Inc.- consumer-oriented company that assesses insurance companies’ financial stability- and recently reported by the Center for Retirement Research at Boston College.
Weiss Ratings compared Medigap premiums in each zip code nationwide and found huge disparities. For example- a 65-year-old man who lives in Hartford- Connecticut- can buy a Plan F policy for anywhere between $2-900 and $7-400 annually. A 65-year-old woman in Houston can pay $5-300 a year for Medigap’s Plan C policy from one insurance company or she can buy exactly the same policy from another insurer for $1-700 a year.
When looking for a Medigap policy- make sure to get quotes from several insurance companies to find the best price. In addition- if you are going through a broker- check with two or more brokers because each broker might not represent every insurer. It can be hard work to shop around- but the price savings can be worth it.