Medigap Policies Available in New York

I am doing an extensive analysis of the Medigap (Medicare supplement) policies currently available to Medicare beneficiaries. This is because the structure of new policies available to beneficiaries changed last June, and by now there is enough information to give some guidance on both the availability and prices of the newly structured policies. The full analysis will take me quite awhile, but I already producing some helpful information for certain states, and it makes sense to begin sharing this now rather than waiting until my full analysis is complete.

There is no need to go into explaining the new structure; this is all spelled out in Managing Your Medicare, on page 157. And even better, you can access, thorough the CD that comes with the book, a “2011 Medigap Standard Policies Worksheet” to help guide you through the process of selecting a Medigap policy during this current year. (Click on the “check for any updated forms” button on the introduction screen to the CD.)

But what I have available here is information on the number of policies available, the lowest priced one available, the highest priced one available, and the average price. Even better, this information is given for each policy type. Also, there is a quick comparison of the average price of each policy type to type “A”, the “basic” policy, so you can easily determine roughly how much more or less the policy type you are looking at compares to the basic one, or indeed, to any other policy type. All this is harder to explain than it is to show.

In New York, the state is divided into ten general areas where Medigap policies may be priced differently. So I have somewhat arbitrarily run my analysis on only two areas. One is New York City, which has the most expensive policies and has the most Medicare beneficiaries. The other is the part of the state which has a ZIP code beginning with 136 (the Watertown area), and which has the cheapest policies, and possibly the fewest beneficiaries. If you live in an area which is not either of these, your policy will mostly be priced between the amounts shown in the analysis. But the analysis will give you a good sense of the variation in price between policies of the very same type, and also a good idea of the difference in prices between policy types.

The information shown applies to Medicare beneficiaries who are age 65 and older, and also to disabled Medicare beneficiaries under age 65. New York is a “guaranteed issue” state, and any insurer writing Medigap policies must accept a Medicare enrollee’s application for coverage at any time throughout the year, and insurers may not deny the applicant a Medigap policy or make any premium rate distinctions because of health status, claims experience, medical condition or whether the applicant is receiving health care services. They may, however, impose a waiting period for preexisting medical conditions under some circumstances, although not all companies do this. However, my analysis shows that policies with no waiting periods are significantly more expensive than those with a six-month wait. Finally, note that guaranteed issue does NOT apply to beneficiaries under age 65 entitled to Medicare because of End Stage Renal Disease (ESRD).

This information comes from the excellent New York State Insurance Department website, www.ins.state.ny.us, which has more detailed information on these policies.

Again, remember that for each policy type, the benefits are exactly the same no matter who sells it, and you should aggressively look for the best price. You will be surprised by the difference in prices for the same policy type. The dollar amounts shown below are the annual cost of the policies. And by the way, to make things easier, there are currently no SELECT Medigap policies available in New York.


Medigap Policies

Policy A:
In NYC, the lowest price available is $1,765, the highest is $3,132, and the average is $2,489. In ZIP 136NN, the lowest price available is $1,299, the highest is $2,902, and the average is $1,926. Some 11 different companies offer these in each of these areas (but not always the same companies). This is the “basic” policy.

Policy B:
In NYC, the lowest price available is $2,334, the highest is $4,194, and the average is $3,272. In ZIP 136NN, the lowest price available is $1,773, the highest is $3,886, and the average is $2,549. On the whole, these cost about 31% more than Policy A. 11 different companies offer these in each of these areas.

Policy C:
In NYC, the lowest price available is $2,994, the highest is $4,857, and the average is $3,798. In ZIP 136NN, the lowest price available is $2,070, the highest is $4,500, and the average is $2,986. On the whole, these cost about 54% more than Policy A. 7 different companies offer these in NYC, 8 in 136NN.

Policy D:
In NYC, the lowest price available is $3,083, the highest is $4,356, and the average is $3,692. In ZIP 136NN, the lowest price available is $2,319, the highest is $3,477, and the average is $2,924. On the whole, these cost about 50% more than Policy A. Only 3 different companies offer these in each of these areas.

Policy F:
In NYC, the lowest price available is $3,009, the highest is $5,009, and the average is $3,878. In ZIP 136NN, the lowest price available is $2,079, the highest is $4,545, and the average is $3,013. On the whole, these cost about 56% more than Policy A. 11 different companies offer these in each of these areas. These cover all Medigap benefits and are popular.

Policy F – High Deductible:
In NYC, the lowest price available is $804, the highest is $1,313, and the average is $1,003. In ZIP 136NN, the lowest price available is $654, the highest is $1,134, and the average is $838. On the whole, these cost about 58% less than Policy A. 11 different companies offer these in each of these areas.

Policy G:
In NYC, the lowest price available is $3,277, the highest is $4,050, and the average is $3,612. In ZIP 136NN, the lowest price available is $2,463, the highest is $3,616, and the average is $2,900. On the whole, these cost about 48% more than Policy A. 5 different companies offer these in NYC, 4 in 136NN.

Policy K:
In NYC, the lowest price available is $1,224, the highest is $1,983, and the average is $1,610. In ZIP 136NN, the lowest price available is $846, the highest is $1,358 and the average is $1,142. On the whole, these cost about 38% less than Policy A. 5 different companies offer these in each of these areas. This is the 50% catastrophic policy.

Policy L:
In NYC, the lowest price available is $1,746, the highest is $2,533 and the average is $2,212. In ZIP 136NN, the lowest price available is $1,209, the highest is $1,764 and the average is $1,592. On the whole, these cost about 14% less than Policy A. 4 different companies offer these in each of these areas. This is the 75% catastrophic policy.

Policy M:
In NYC, the lowest price available is $2,874, the highest is $3,180. In ZIP 136NN, the lowest price available is $2,162, the highest is $2,197. No average is given as only 2 different companies offer these in each of these areas. On the whole, these cost about 18% more than Policy A. This policy is very new.

Policy N:
In NYC, the lowest price available is $1,872, the highest is $2,966 and the average is $2,360. In ZIP 136NN, the lowest price available is $1,335, the highest is $2,136 and the average is $1,837. On the whole, these cost about 5% less than Policy A. 6 different companies offer these in each of these areas. This policy is very new.