Art of Insurance Blog
If you are an older person enrolled in the Medicare program, you can expand your healthcare coverage by supplementing your Medicare plan. That supplement is called Medicare Supplements. As suggested by its name, it provides extra benefits to Medicare beneficiaries. It can pay the out-of-the-pocket health and medical costs not covered by your Original Medicare plan.
The insurance policy fills in the coverage gaps of Medicare Parts A and B. That is why it is sometimes called the Medigap policy. There are nine plans available for the typical Medical Supplements, which are Plans A, B, C, D, F, G, K, L, M, and N.
For Medicare Supplements, policyholders are going to pay a monthly premium. Your premium cost depends on several factors, such as the type of plan you selected and your location. Aside from these factors, here are the two standard methods used by private insurance companies in determining the cost of your Medicare Supplements premiums:
In this scheme, insurance companies will charge every policyholder the same monthly premiums. Everyone will pay the same amount of insurance premium each month regardless of their age.
Unlike in other insurance policies, age is a non-factor in this method. That is why it is also called the no age-rated policy. However, inflation and several other factors can affect your monthly premium.
For example, 65-year-old Sally got Medicare Supplements. She is paying a monthly premium of $175. Her neighbor, 77-year-old Roger, also obtained the same policy. He is paying $175 every month as a premium.
In this Medicare Supplements policy, age will not be a factor in your monthly premium since all of you will pay the same amount.
Issue-Age Rated Pricing
In contrast with community-rated, age is a factor in the issue-age rated scheme. Insurance companies will base your monthly premium on the age when you got the Medicare Supplements policy. The younger you obtain this extra healthcare insurance policy, the lower your monthly premium will be.
Since age plays a significant factor in the monthly premiums, it is occasionally called the entry age-rated. Your premium is tied with your entry age. It will not increase or change as you get older. Your age will go up, but your premium will remain the same.
For example, Harry got his Medicare Supplements at the age of 65, and he is paying a $155 monthly premium. Meanwhile, his friend, Warren, got his policy when he was 74 years old. Warren is paying $175 every month for his policy. Since Harry got his Medicare Supplements at a younger age than Warren, he is paying a lower monthly premium. Nonetheless, the monthly premiums of Harry and Warren will no longer change as they grow older.
As people grow older, many older persons and disabled individuals will be needing to expand their healthcare coverages. In most instances, Medicare Parts A and B are no longer sufficient to cover healthcare costs. Hence, Medicare Supplements is here to provide additional coverages for them.
At Art of Medicare, we do our best in making sure that our clients are well-protected with affordable and comprehensive policies. We make sure to go the extra mile to help you with your needs. To learn more about how we can help you, please contact our agency at (702) 776-7726 or Click Here to request a free quote.