There’s a full-page ad in today’s Arizona Daily Star for a Medicare supplement company. The message is to pick a Medicare supplement based on the company with the lowest price.
What to ask about the pricing for Medigap plans:
Ask the question, “How much will this lowest-priced supplement go up in a year?” Then ask, “and what about three months after that, or at the two-year mark? How much will my premium go up within two years?”
Every insurance agent, or the helpful person at a company’s call center, should be able to give you an answer.
The problem with choosing a Medicare supplement based on the lowest price is that that price will certainly go up over time. And if the price goes up 30 to 40% in one year (or just over a year), you may not be able to go shopping for another Medicare supplement.
With Medicare supplements, when a person turns 65, or first gets Part B of Medicare, he has six months to buy a Medicare supplement without answering any medical questions. But after that, when the premium has skyrocketed, that person will have to answer medical questions if he applies with another company. And if that person has health problems (diabetes, cancer history, heart disease….) he can be turned down for coverage. He will then be stuck with that Medicare supplement policy with a premium that will go up 20 to 40% each year.
So be sure to ask what the average price increase is after one year, or two years. If the person you’re talking to won’t give an answer, you should walk away or hang up the phone.
To learn more about Medicare supplements, Medicare Advantage, Part D, and much more, you might want to take a course on Medicare. Click on the image below.