Medicare Supplement Insurance: Important Questions To Ask Before Buying

A recent analysis of Medicare Supplement insurance prices revealed a significant difference between the lowest and highest rates for virtually identical coverage,

According to the 2021 Medicare Supplement Insurance Price Index, a woman turning 65 in Chicago can purchase Medigap Plan G protection for as little as $110 monthly.  If she purchased the most expensive Plan G policy available in Chicago, she would pay $270 per-month.

While Medicare Supplement policies, often referred to as Medigap, are designed to meet uniform standards, each insurance company establishes their own pricing.  The prices will vary based on where you live and which company you choose.

The price variance affects buyers in all markets.  The study found the lowest price for a 65-year-old man in Los Angeles was $135.  Another man buying the same plan of coverage could pay as much as $249 monthly.  In Phoenix the highest rate found was $378.

Finding the best coverage for the best price can involve a bit of effort.  Equally important, it can involve asking the right questions.  Here are three shared by leading industry experts.

See also: Best Medicare Advantage Plans

Are any discounts available?  Many Medigap insurance companies offer couple or partner discounts.  The survey found they range from five percent to as much as 14 percent of the base premium.   Note that rules to qualify for the discounts can vary from one company to the next.  Be sure to ask about other discounts that may help reduce your cost.  For example, some companies will offer a discount to those making one annual payment versus monthly installments.

What is the company's history of rate increases?  The lowest priced policy currently available may appear to be the best buy.  Keep in mind however that you'll likely be paying premiums to the insurance company for many years.  An agent who specializes in Medicare insurance will be able to provide you with reports reflecting the insurance company's ratings and history of rate increases.

Can you pay by credit card?  This is especially meaningful for those using credit cards the offer cash back or travel points.   While the amount might seem insignificant on a monthly basis, for a couple the benefits can add up over time.

Find Local Medicare Insurance Agents

Today a growing number of call centers handle consumers seeking Medicare insurance information.  Many consumers still prefer to work with a local Medicare insurance agent.  The American Association for Medicare Supplement Insurance makes available a free-to-use online Zip Code-based directory providing contact information for agents nationwide.  

There's one final important question to ask any insurance sales professional you choose to work with.  Ask whether the individual is an agent or a broker.  By definition, an insurance agent usually is only able to sell policies from one specific insurance company.  

Conversely, an insurance broker will typically represent and earn commissions from multiple insurance companies.  While that may seem the preferred person to work with, a broker may not be able to offer the plan sold exclusively available to agents.  If you are willing to invest the time, speaking with more than one individual may help you get the best coverage for the best price.