You may think to yourself that it is interesting that there could be so much difference in price between Standardized Medicare Supplement Plans. We have seen prices vary by over 100% from company to company. So how are these rates determined? There major factors that weigh into rate determination.

In what region does a company decide to sell within?

Every state has differing regulations that can affect the rates of insurance policies in those states. If you are in a highly regulated state you may be paying more than someone that is in a state that has less regulations. In addition companies that operate in states where the regulatory standards are more stringent will sometimes pass those costs onto their customers in other states thus increasing the costs for all customers in all states where that company operates.

Remember that just because a Medicare Supplement Company does not sell in a certain state does not mean that you would not have coverage in that state. You will have coverage at every provider in the country that accepts Medicare. This means that if you happen to be in a state that does not have very strict regulations you might find yourself getting a much better premium on your Medicare Supplement Plan rate.

Medicare Supplement companies have the option to offer their Medicare Supplement Plans to a group that may be retiring. When a Medicare Supplement Company does offer to a Retiring Employer Group they have to offer Guaranteed Issue status to all applicants. All Medicare Supplement Plans have periods of time where they have to offer Guarantee Issue status. For example, when someone is losing coverage, turning 65, or coming off of a Group Plan.

Think about it like this if a large retiring group is offered Medicare Supplement Plans through a company, it is now that companies responsibility to offer coverage to every single Retiree. You could imagine that the Medicare Supplement Company is opening themselves up to many more potential health issue that they did not underwrite because everybody was Guaranteed Issue.

Want to find out more about medicare supplements, then visit Andrew Coutavas’s site on how to choose the best medigap for your needs.

-- Download Why Is One Medicare Supplement Plan More Than Another?-Part 1 as PDF --