How to Rate Medicare Supplement Insurance Companies

Choosing the right Medicare supplement plan is an important task for many senior citizens. What makes this process difficult is finding the right insurance company to buy it from. Twelve standardized Medicare supplement plans (or Medigap plans) exist; these plans are the same no matter which insurance company you buy them from. The only real difference is the price of the plan—although two different companies might offer you the exact same plan, the price might be different.

Instructions

• 1

  Narrow down your choices to consider just a couple of plans. You should then figure out which companies offer those specific plans and at what cost. You might find out that the same plan is priced differently by different companies. Price is really the only difference when trying to compare insurance companies that offer Medigap plans.

• 2

  Find out how your prospective insurance companies price their plans. Insurance companies price their Medicare supplement plans in three different ways:

  Attained-age rated: Insurance companies will take into account how old you are and price the plan accordingly. As you get older, the price of your plan will rise. So you might start off paying a certain amount for a plan when you turn 65, but by the time you're 75, your premium may have risen dramatically.

  Issue-age rated: This is based on how old you are when you first invest in your Medicare supplement plan. Your premium might start off somewhat high, but it will not change as you get older. Your age will have no effect on the price.

  Community rated: This pricing method is not based on age at all. For this pricing plan, an 85-year-old would pay the same amount as a 65-year-old for the same plan.

• 3

  Get a better feel for how to rate an insurance company based on these pricing methods. If you're older than 75, you might consider trying to find an insurance company that sells your desired plan based on a community-rated method. But if you're still in your late 60s, getting an issue-age-rated plan would be a great financial investment, as your premium would remain consistent as you grow older.

  No matter what insurance company you go to, you'll find the exact same Medicare supplement plans, so the only way to really tell them apart is by how they price their plans. Buy from the company that is going to give you the best deal based on your particular attributes.