Understanding Medigap Costs

How Much Does Medigap Cost?

Medigap costs vary significantly based on several factors, but understanding how pricing works can help you find the best value. Monthly premiums typically range from $80 to $400, depending on the plan, your location, age, and other factors.

Factors That Affect Medigap Premiums

1. Which Plan You Choose

Different plans have different premium costs:

• Plan A: $80-$150/month (basic coverage)
• Plan N: $100-$200/month (good value)
• Plan G: $140-$280/month (comprehensive)
• Plan F: $160-$320/month (most comprehensive, if eligible)
• High Deductible Plans: $30-$80/month (lowest premiums)

2. Your Location

Premiums vary by state and even by ZIP code. The same plan can cost twice as much in one state compared to another. Urban areas often have lower premiums than rural areas due to more competition among insurance companies.

3. Your Age

Insurance companies use three pricing methods:

• Community-rated: Everyone pays the same premium regardless of age
• Issue-age-rated: Premium based on age when you buy; doesn't increase with age
• Attained-age-rated: Premium increases as you get older (most common)

4. Gender

In some states, men and women pay different premiums. Women often pay slightly less because they statistically live longer and use healthcare more wisely.

5. Tobacco Use

Tobacco users typically pay 15-30% more in premiums. Some companies don't charge more for tobacco use, so it pays to compare if you use tobacco products.

6. Household Discounts

Many insurance companies offer 5-12% discounts if both spouses have policies with the same company.

Ways to Save on Medigap

Enroll During Your Open Enrollment Period

This is the most important tip! When you enroll during your 6-month Open Enrollment Period, companies cannot charge you more based on health conditions. If you wait, you might pay significantly more or be denied coverage.

Compare Multiple Companies

Since all Plan G policies are identical, shop around! Prices can vary by $500-$1,500 per year for the exact same coverage. Get quotes from at least 3-5 companies.

Consider Plan N Instead of Plan G

If you're healthy and don't see doctors frequently, Plan N can save you $20-$60 per month ($240-$720 per year) compared to Plan G.

Look into High Deductible Plans

High Deductible Plan G has much lower premiums but requires you to pay $2,950 out-of-pocket before coverage kicks in. Great for healthy people who want catastrophic protection.

Ask About Discounts

• Household discounts (both spouses enrolled)
• Electronic Funds Transfer (EFT) discounts
• Online enrollment discounts
• Member association discounts

Premium Increase Expectations

Medigap premiums typically increase over time due to:

• Age: If you have attained-age pricing
• Inflation: General healthcare cost increases
• Claims experience: If many policyholders file large claims

Expect premium increases of 3-7% annually on average, though this varies by company and plan.

Can You Switch Plans to Save Money?

Yes, but with limitations. You can apply to switch Medigap plans at any time, but outside your Open Enrollment Period or without guaranteed issue rights, you'll need to pass medical underwriting. If you're healthy, shopping around every few years can save money.