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 in June of 2010, and by now there is enough information to give some guidance on both the availability and prices of the newly structured policies. There is no need to go into explaining the new structure; this is all spelled out in detail in Managing Your Medicare, on page 157.
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. I have somewhat arbitrarily run my analysis on three of these areas. One covers New York City, Long Island, and parts of Westchester, which, of course, includes the vast majority of Medicare beneficiaries, and which tends to have the highest premiums in the state. The next is the Buffalo area, which is the part of the state with ZIP codes beginning with 140-143 &147; it’s the second most populous area. The last is the Watertown area (ZIPs beginning 136), and which has the state’s cheapest policies, and possibly the fewest beneficiaries. If you live in an area which is not in one of these, policies available to you will mostly be priced between the amounts shown for the New York City and the Watertown areas, and the analysis will give you a very 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 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 Department of Financial Services website, www.dfs.ny.gov, which has more detailed information on these policies, as well as the website addresses of the various insurance companies which sell them.
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 monthly 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 Available in New York City, Long Island and Parts of Westchester
Policy A: The lowest price available is $147, the highest is $273 and the average is $213.
Some 11 different companies offer these. This is the “basic” policy.
Policy B: The lowest price available is $194, the highest is $350 and the average is $280.
These cost about 32% more than Policy A. 11 different companies offer these.
Policy C: The lowest price available is $249 the highest is $405, and the average is $322.
These cost about 51% more than Policy A. 7 different companies offer these.
Policy D: The lowest price available is $257 the highest is $363, and the average is $315.
These cost about 48% more than Policy A. Only 3 different companies offer these.
Policy F: The lowest price available is $251, the highest is $417, and the average is $331.
These cost about 55% more than Policy A. 11 different companies offer these. These cover all Medigap benefits and are popular.
Policy F – High Deductible: The lowest price available is $67 the highest is $116 and the average is $87.
These cost about 59% less than Policy A. 4 different companies offer these. The deductible in 2012 is $2,070.
Policy G: The lowest price available is $273, the highest is $377, and the average is $318.
These cost about 49% more than Policy A. 5 different companies offer these.
Policy K: The lowest price available is $102 the highest is $175 and the average is $138.
These cost about 35% less than Policy A. 5 different companies offer these. This is the 50% catastrophic policy. The catastrophic level for this policy in 2012 is $4,660.
Policy L: The lowest price available is $145, the highest is $224 and the average is $192.
These cost about 10% less than Policy A. 4 different companies offer these. This is the 75% catastrophic policy. The catastrophic level for this policy in 2012 is $2,330.
Policy M: The lowest price available is $240 the highest is $290.
No average is given as only 2 different companies offer these. These cost about 24% more than Policy A. This policy is very new.
Policy N: The lowest price available is $161 the highest is $247 and the average is $202.
These cost about 5% less than Policy A. 6 different companies offer these. This policy is very new.
Medigap Policies Available in the Buffalo Area
(ZIPs Beginning with 140-143 & 147)*
Policy A: The lowest price available is $108, the highest is $242 and the average is $166.
Some 12 different companies offer these. This is the “basic” policy.
Policy B: The lowest price available is $148, the highest is $324 and the average is $221.
These cost about 34% more than Policy A. 12 different companies offer these.
Policy C: The lowest price available is $172 the highest is $375, and the average is $256.
These cost about 55% more than Policy A. 9 different companies offer these.
Policy D: The lowest price available is $204 the highest is $290, and the average is $253.
These cost about 54% more than Policy A. Only 3 different companies offer these.
Policy F: The lowest price available is $173, the highest is $379, and the average is $259.
These cost about 57% more than Policy A. 12 different companies offer these. These cover all Medigap benefits and are popular.
Policy F – High Deductible: The lowest price available is $55 the highest is $102 and the average is $79.
These cost about 52% less than Policy A. 5 different companies offer these. The deductible in 2012 is $2,070.
Policy G: The lowest price available is $217, the highest is $301, and the average is $250.
These cost about 51% more than Policy A. 4 different companies offer these.
Policy K: The lowest price available is $70 the highest is $120 and the average is $100.
These cost about 40% less than Policy A. 5 different companies offer these. This is the 50% catastrophic policy. The catastrophic level for this policy in 2012 is $4,660.
Policy L: The lowest price available is $101, the highest is $153 and the average is $138.
These cost about 16% less than Policy A. 4 different companies offer these. This is the 75% catastrophic policy. The catastrophic level for this policy in 2012 is $2,330.
Policy M: The lowest price available is $190 the highest is $200 and the average is $195.
Only 3 different companies offer these. These cost about 19% more than Policy A. This policy is very new.
Policy N: The lowest price available is $111 the highest is $207 and the average is $168.
These cost about 2% more than Policy A. 7 different companies offer these. This policy is very new.
*Note: In some places in this area certain companies price some policies somewhat lower than shown above, so you may be quoted a little better price that shown, but the pattern described above is the general one.
Medigap Policies Available in the Watertown Area
(ZIP beginning with 136)
Policy A: The lowest price available is $108, the highest is $242 and the average is $165.
Some 11 different companies offer these. This is the “basic” policy.
Policy B: The lowest price available is $148, the highest is $324 and the average is $219.
These cost about 33% more than Policy A. 11 different companies offer these.
Policy C: The lowest price available is $172 the highest is $375, and the average is $252.
These cost about 53% more than Policy A. 8 different companies offer these.
Policy D: The lowest price available is $193 the highest is $290, and the average is $249.
These cost about 51% more than Policy A. Only 3 different companies offer these.
Policy F: The lowest price available is $173, the highest is $379, and the average is $256.
These cost about 56% more than Policy A. 11 different companies offer these. These cover all Medigap benefits and are popular.
Policy F – High Deductible: The lowest price available is $55 the highest is $94 and the average is $72.
These cost about 56% less than Policy A. 4 different companies offer these. The deductible in 2012 is $2,070.
Policy G: The lowest price available is $205, the highest is $301, and the average is $247.
These cost about 50% more than Policy A. 4 different companies offer these.
Policy K: The lowest price available is $70 the highest is $120 and the average is $98.
These cost about 41% less than Policy A. 5 different companies offer these. This is the 50% catastrophic policy. The catastrophic level for this policy in 2012 is $4,660.
Policy L: The lowest price available is $101, the highest is $153 and the average is $138.
These cost about 16% less than Policy A. 4 different companies offer these. This is the 75% catastrophic policy. The catastrophic level for this policy in 2012 is $2,330.
Policy M: The lowest price available is $180 the highest is $200.
No average is given as only 2 different companies offer these. These cost about 15% more than Policy A. This policy is very new.
Policy N: The lowest price available is $111 the highest is $184 and the average is $156.
These cost about 5% less than Policy A. 6 different companies offer these. This policy is very new.
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