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Medicare Supplement Insurance Rates

Medicare supplement insurance rates can depend on many factors, including your age, when you enroll in your policy, your zip code and in some cases, your medical history. Medicare supplement insurance is private coverage that you can purchase to cover your coinsurance, deductibles, excess charges and other services. Your monthly rates are determined by the benefits that you receive with your plan, among a number of other factors. There are 10 standardized options to choose from, each with varying advantages and rates for supplemental Medicare insurance. Researching supplement policies can help you determine the coverage you need before buying a plan.

Supplement Insurance Basics

Since original Medicare can only cover 80 percent of an approved expense for services, most seniors need an extra form of coverage to pay for their coinsurance. This extra coverage can come in the form of a Medicare Advantage plan, like an HMO or PPO, or it can come from a supplement insurance plan, also called Medigap. An HMO replaces your original coverage and places you in a network. This means that you must find medical providers within your network, and you may have to get a referral to see a specialist. A Medigap policy simply supplements your original plan, so you can still see any doctor that accepts Medicare.

The coverage you receive is based on the plan you choose. You can choose from one of 10 standardized Medigap plans. Your Medicare supplement insurance rates are also determined by your plan. Medigap Plan A offers the the most basic coverage with the least expensive premiums. Plan A covers your coinsurance and your first three pints of blood withdrawn. The most comprehensive policy is Plan F. This policy covers your coinsurance, deductibles, excess charges, hospice care and foreign travel emergency insurance. As the most comprehensive, Plan F often has the highest Medicare supplement insurance rates on average. Researching different plans and their premiums thoroughly can help you find the best plan for you at the greatest value.

How Supplement Rates Are Determined

One of the most important factors in determining Medicare supplement insurance rates is the Open Enrollment period. If you purchase your Medicare supplement insurance during Open Enrollment, the six months immediately following the date you enrolled in both Medicare parts A and B, you cannot be denied your first choice Medigap insurance policy, nor must you go through medical underwriting. This means that a company cannot charge you higher rates because to your lifestyle or a preexisting condition. If you let your Open Enrollment period expire, any number of factors can affect your Medicare supplement insurance rates, including your family history, prior medical conditions, age and lifestyle. Tobacco use can particularly affect your rates. Another surprising factor is your gender. Women, who live longer on average than men, often enjoy lower rates.

Another important factor that can affect your Medicare supplement insurance rates is your age. Companies can choose one of three ways to determine your rate based on your age. Companies using the community-rated method charge the same monthly premium to everyone with a given plan, no matter what their age. The second method, issue-age-rated, uses the age you are when you purchase your policy to determine your premium. You keep this rate, adjusted for inflation, as long as you keep your policy. The final method, or the attained-age method, uses your age to determine your monthly premium, so your rate will go up along with inflation as you get older.

A few surprising factors can also play into your Medicare supplement insurance rates. One of these is your zip code. Medigap companies can charge different premiums for different zip codes, so investigating a number of providers in your area can help you determine the best value. Since Medigap plans are standardized by the federal government, all plans of a given letter offer the same benefits, no matter what the price. So Medigap Plan A at a large company in your nearest city is exactly the same as Plan A at a small provider, even if the prices vary significantly.

A surprising factor that can affect the best plan for you regardless of Medicare supplement insurance rates is your income. If you haven't saved very much for your retirement, you might be tempted to choose the least expensive Medigap plan to save money. This could leave you in a financial bind if you face an unexpected medical emergency. If you have a large nest egg and are in excellent health, you might consider a high deductible policy. These plans offer comprehensive coverage after you pay an annual deductible in exchange for a low monthly premium. When researching Medicare supplement insurance rates, examining all options before making a decision is important to finding the right plan for you at the right price.

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