How Often Can a Medigap Policy Raise Rates?

[MayGray]

I signed up for a Medigap "F" policy in January of this year to begin February 1 when I started on Medicare. In June I got a letter saying that my premium would go up, starting with the July payment of the August premium.

Now this seems odd because we cannot change plans until the open enrollment period at the end of the year. If they can raise rates anytime during the year how can we decide which plan to choose?

Is it normal - usual - common for a plan to raise its premiums during the year? This is Blue Shield of California -- what other plans do you know of that change rates during the calendar yer?

 

[mickeyd]

Hey MayGray,

I found this. It appears that your state (CA) has unique regs that cover this. Interesting, since I have TricareforLife as my "medigap", I had never looked into it.

e]In most states, medigap policies can be priced in three ways:

With attained-age policies, premiums will increase as you get older -- typically ratcheting up every one, three or five years. (This is in addition to price increases linked to health-care inflation, a reality that affects all policies regardless of rate structure.) Attained-age policies generally start out less expensive than others, but premiums can rise much faster. For an idea of how fast, ask any insurer whose policy you are considering at age 65 how much it's charging 70-, 75- and 80-year-olds now.

Issue-age policies base your rate on your age at purchase. If you buy the policy at age 65, for example, it's less expensive than if you buy it at 75. But once you buy, the price won't increase just because you get older. (Premiums will rise with health-care inflation.)

"As a general rule, the attained-age policies start out looking inexpensive but end up costing a whole lot more than the issue-age policies," warns Diane Archer, founder of the Medicare Rights Center, which helps senior citizens with their health-care choices.

Community-rated policies are similar to issue-age versions, except that everyone in the same area pays the same price regardless of age (AARP, however, generally provides a discount -- up to 20% -- until about age 68). Once you buy, premiums will not rise simply because you get older.

How to win the medigap pricing game - MSN Money