Surprises can be fun. Most folks love unwrapping presents during the holidays or being reunited with loved ones returning from armed services duty, and a few hardy souls even enjoy surprise birthday parties. Please note that none of those examples involved a surprise bill.
Almost all of us hesitate during financial decisions, anticipating the future. Might those gym dues go up? Which car insurance will skyrocket after an accident? How long does that low credit-card rate really last?
Medicare Supplement insurance, or “Medigap”, is no different.
What Is Medicare Supplement Insurance?
Medicare Parts A and B cover hospital insurance and medical insurance, respectively. Anyone who’s ever been to see a doctor can tell you there are multiple costs that go beyond those two factors. What do you do about a copay your doctor charges for a physical? How do you cover deductibles in your existing health plan? What if you’re sick while traveling overseas?
That’s where Medicare Supplement insurance may be able to help. Private companies sell these supplemental policies to help cover copayments, deductibles, coinsurance, medical care outside the United States, and much more1. A wide range of policies covering a wide range of situations exists; we recommend you do a fair bit of research to find the company and coverage best suited to your needs.
Are Medicare Supplement Premiums Fixed?
Once you’ve decided on a provider and coverage, you’ll be presented with options that will determine your premiums. Three basic pricing structures exist2:
- Community-rated premiums offer the same premium to everyone, and are not based on age.
- Issue-age premiums are fixed based on the age you purchase the plan, and do not go up automatically as you age.
- Attained-age-rated premiums get more expensive as you age. Issue-age premiums may be more expensive than attained-age- rated premiums at the outset, but attained-age premiums will surpass issue-age premiums as you get older.
Please note that all of these premiums can increase at any time. Medicare coinsurance and deductible amounts are set by the Centers for Medicaid and Medicare Services each year and can increase due to inflation, and other economic factors outside the provider’s control.
If you’re looking for a plan with premiums that less likely to change as often, try to look for companies offering issue-age premiums. They may cost more than the others at the outset, but you less likely to be surprised when the bill comes each month. As always, though, please speak with a licensed Medicare Supplement insurance Agent about your options before deciding on a plan.
Your style is your choice. Shouldn't your doctor and your coverage be, too?
Learn more about Medicare Supplement insurance options.
1 Medicare.gov, What’s Medicare Supplement Insurance (Medigap)?, 2019
2 Medicare.gov, Costs of Medigap policies, 2019