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I am looking to get on to Medicare early next year and while reading up on this topic, I see this line, “All plans with the same letter have the same coverage, but prices can vary based on the insurance company” repeated often regarding the Medigap policies.
For example, when I look up Plan G for my state (SC), I see that there are “47 plans” and the premiums range from a low of $90 all the way up to (gulp) $493.
If all the “plans offer same coverage”, then why would one opt for a higher premium plan? What is the value add or incentive to go with a higher premium plan? Why would everyone not go for the lowest premium plan especially since Medicare sets the rules they all offer “same coverage”? Is there something obvious that I am missing?
Thanks!
Since I started this thread, I wanted to follow up with what I found and the route I was taking.
Here is the playbook I used, first identify the plan. In my case, I looked at Plan G, N and HD G. I quickly ruled out HD G since it maybe tougher to get back to G or N at a later time without underwriting.
While comparing G & N, while the initial premium difference is small (about $30 a month) in the overall scheme of things, I was more concerned with the hikes to come down the road. And based on my reading, between the guaranteed rights that G offers and folks needing greater medical care at this time are likely to lean to G, I thought price hikes could be higher with Plan G (than N).
And with plan N, I get everything that G offers except for the co-pay (not a huge issue in my opinion) and the “excess” charge coverage, again a non-issue in my view.
Once the plan selection was done, the next task was to identify the insurance company. I reached out to our SHIP and got the data in PDF format which I normalized into a spreadsheet.
Company L/R SC L/R US
Woodmenlife 300.09 77.99
Humana Achieve228.54 89.3
MOO 102.71 83.3
Manhattanlife 100.86 93.79
GPM Health 100.32 90.89
Philadelphia 95.92 95.37
Aetna Health 95.77 96.14
Cigna 95.34 94.61
Happy to hear any thoughts
Thanks for reactivating this forum post. I’m finally paying attention to Medicare details now that I’m coming up on my 65th bday in August. I live in NY, which is one of those states that allows you to go back and forth between traditional and Advantage without underwriting, but after reading these posts I will probably just go with traditional and Medigap of some kind, biting the bullet on the extra costs. One goal is to avoid UnitedHealthcare, if I can. Their drive for cost controls at all costs has ruined my longstanding regional healthcare group, acquired by UHC a few years ago. It’s currently being sued by the state attorney general for certain bad practices.
The difference in L/R between the state level and US level is pretty amazing for a few of the companies. The company with the lowest national L/R – Woodmenlife – had a 300% state L/R. I wonder how that is explained? All but one of the companies in the table above had US L/R above 80. What was the breakdown of state vs. US for the company you picked?
Here it goes, unfortunately I haven’t quite figured (in HD) out how to copy/paste from excel and keep the tabular format – so apologies for the presentation (I did a transpose to make it easier to read)
Company=Ace P&C Insurance
#Years in Market=2
Age Average hike%=0.7%
AVG Inflation hike=2.0%
Lives National=51307
Lives SC=1953
LMR Nat%=70.05
LMR SC%=64.81
PRM National=$37,797,106
PRM SC=$1,536,931