Medigap plan G vs plan N

[sengsational]

Nobody has explained why those people who qualify to enroll under Guarantee Issue would be more expensive to insure than those who are already in a Plan G pool. The circumstances which result in someone having Guarantee Issue eligibility have nothing to do with their individual health. In the absence of any explanation or data, I think that Guarantee Issue is a red herring as far as Plan G rate increases are concerned.

There are two factors at work. In the set of people who are allowed into a plan without underwriting due to an over age 65 guaranteed issue, there will be formerly Medicare Advantage people and formerly traditional Medicare people. The other factor is that the default replacement is plan G. But it is also likely agreed that if everyone has the same level of utilization (no group is sicker than the other), then it doesn't matter.

I guess because I've heard so much about people on Medicare Advantage plans that can't pass underwriting and being starved of important medical services in all sorts of ways, and they now consider their decision to go with the cheaper (at the time) Medicare Advantage plan a mistake, those people would be jumping into traditional Medicare for the obvious reasons. Whereas the healthy person coming from an MA plan might go cheap again because they're not sick don't yet know the problems of getting treated under a marginal MA plan.

The result is that as each decision is made for a guaranteed issue person, the sicker MA people will opt for traditional Medicare. This is the same thing as guaranteed issue at age 65; if you know you'll be using a lot of services, you're advised to go with traditional Medicare.

I'm not sure that it's a big factor. In fact I'm pretty sure it's not a big factor in pricing when you have large pools of people. But if you believe sicker people formerly on MA plans are more likely to switch to traditional Medicare than healthy people, then it's at least a factor of some magnitude.

 

[CWradio]

The reason guaranteed issue folks drive up the price is simple. They’re older and older people tend to be sicker. Additionally, some people on Advantage plans will move back to original Medicare because of a medical problem they have as they age.

Be interesting to see if there was a increase of Medigap Insurance companies rates when the few states implemented the birthday rule a few years back.

 

[MichaelB]

Nobody has explained why those people who qualify to enroll under Guarantee Issue would be more expensive to insure than those who are already in a Plan G pool. The circumstances which result in someone having Guarantee Issue eligibility have nothing to do with their individual health. In the absence of any explanation or data, I think that Guarantee Issue is a red herring as far as Plan G rate increases are concerned.

BTW, I believe there's one other additional cost for Plan N holders vs. Plan G holders: Under Plan N rules, there's up to a $50 co-payment for visits to the ER which don't result in hospital admission.

I agree with the red herring assessment.

In addition, pricing is controlled individually by each state. Just as important, insurers set prices to nudge consumers toward one option over another. When seeing differences in prices for things like insurance my default assumption is the insurer wants us to choose the less expensive option, perhaps just to rebalance their risk portfolio.

 

[anethum]

The reason guaranteed issue folks drive up the price is simple. They’re older and older people tend to be sicker. Additionally, some people on Advantage plans will move back to original Medicare because of a medical problem they have as they age.

I don't think that's correct. In most states, each supplemental plan is priced in age bands. Even AARP/UHC effectively has age bands due to their discounts that decrease with age. Therefore anyone switching plans due to Guaranteed Issue will be paying the same rate as others of their age band. And since there's no reason to think that Guarantee Issue folks are sicker than existing Plan G subscribers in the same age band, it should make no difference.

Even in those few states with Community Pricing (I think NY & VT, for example), it should still be a wash with new members arriving thanks to Guarantee Issue. After all, these folks were already in a supplemental plan. If anything, more Medicare-eligible folks in those states are moving to warmer states as they age, not coming in.

 

[DrRoy]

I have been following a couple threads leading up to my selection soon. I had rather decided that I would go for Medigap G with AARP/UHC. However, I only see a doctor about twice a year, and read comments that excess charges do not come up often, so I am now thinking that N might be better. Humana has a plan N that is $43/mo less than UHC G and $24/mo less than UHC N. It is still better than UHC at age 80. Does anyone know of issues with Humana N, or is this my best option?

 

[ncbill]

The reason guaranteed issue folks drive up the price is simple. They’re older and older people tend to be sicker. Additionally, some people on Advantage plans will move back to original Medicare because of a medical problem they have as they age.

Not likely they'll pass the underwriting needed to move to a Medigap plan from a Medicare Advantage plan once they've developed a medical problem.

 

[Dash man]

We’re discussing guaranteed issue situations as identified above.

 

[RetMD21]

...They’re older and older people tend to be sicker. Additionally, some people on Advantage plans will move back to original Medicare because of a medical problem they have as they age.

Which of the guaranteed issue rules allows this?

 

[Dash man]

For one: • You have a Medicare Advantage (Part C) plan that is leaving Medicare or is ending its coverage in your area. This is also true if you are moving out of your plan’s service area.
You can look up other situations yourself.

 

[RetMD21]

So you think people moving out of the service area or having companies close on them have more medical problems?

 

[sengsational]

So you think people moving out of the service area or having companies close on them have more medical problems?

It could be a little of that, but that's not the majority.

I imagine, and this is speculation, that there's some people who move just to get out of their crappy MA plan. They get sick, and then get sick of dealing with limited network and say "to heck with this" and move, giving them the opportunity to get into Traditional Medicare. So that's probably a "thing", but a "small thing".

If you look at it hydraulically, there is no "back-pressure" on the flow from Traditional Medicare to Medicare Advantage. Anyone that wants to, can switch to an MA plan without restriction. The same can't be said for the opposite direction. So I submit that there IS back-pressure going from MA to TM. Indicated also by states writing laws intended to protect consumers by (selectively) allowing them to get out of a bad deal (birthday rules)?

So if one agrees that it's easy to go one way, and harder to go the other way, then next up is the reason why that's the case. Because of the rules, but why do we need the rules? If the person in the MA plan is healthy, they haven't experienced the down-sides of MA plans and are likely to stay in the MA plan. If the person in the MA plan has been sick and found problems with the MA plan that they're tired of dealing with, and maybe as a sicker person, it's no longer "cheap", they're likely to want to switch. And if they switch to TM, the default is Plan-G.

One need not believe that healthy people in MA plans would be more likely to stick with their MA plan over sick people, given the option to change, but I think that's a pretty reasonable bet.

Again, the magnitude of the "problem" and whether it actually gets all the way to affect pricing in a meaningful way, well, those are things that are harder to argue. And I'm not going to try.

 

[sengsational]

In addition, pricing is controlled individually by each state. Just as important, insurers set prices to nudge consumers toward one option over another. When seeing differences in prices for things like insurance my default assumption is the insurer wants us to choose the less expensive option, perhaps just to rebalance their risk portfolio.

I always thought that pricing was determined by the expenses in the pool. I guess they have flexibility in that it's accounting, after all, which is an inexact science. I don't know enough about it to know how much liberty they have to raid one pool and give it to the other in order to nudge consumers around.

 

[RetMD21]

....So if one agrees that it's easy to go one way, and harder to go the other way, then next up is the reason why that's the case. Because of the rules, but why do we need the rules? If the person in the MA plan is healthy, they haven't experienced the down-sides of MA plans and are likely to stay in the MA plan. If the person in the MA plan has been sick and found problems with the MA plan that they're tired of dealing with, and maybe as a sicker person, it's no longer "cheap", they're likely to want to switch. And if they switch to TM, the default is Plan-G....

Sure, if there were not rules it would be tempting to sign up for the cheaper MA option while healthy then switch to traditional when in poor health. There are no actual facts supporting the speculation that this will affect G rates relative to N. I find it hard to believe that many folks that get seriously ill will be moving to get away from their MA plan.

 

[CRLLS]

Unfortunately, Illinois has decided to no longer publish companies' supplement rates starting this year. In years past one could compare what the various rates were between companies, plans and age in one simple document. Now they publish a pamphlet with no teeth and no premiums listed.

This Guide replaces our Medicare Supplement Premium Comparison Guide. The Guide has been transformed into a “Choices” publication highlighting traditional Medicare with a Medicare supplement policy versus taking a Medicare Advantage plan. The premium rates are no longer printed in the Guide. For a real time quote please contact a SHIP counselor who has access to the SHIP TA Center website that can give ‘real time’ quotes for clients.

It appears to me that the state MA plan providers, whose rates were never publicly displayed in one place, wanted to be on the same level as the Supplements. Their solution is to push to remove the competition's rate data from public perusal. I used that Supplement rate publication many times in choosing for myself and helping others find info for themselves. It will be sorely lost.

Total lack of transparency is not the solution to partial information.

 

[audreyh1]

It could be a little of that, but that's not the majority.

I imagine, and this is speculation, that there's some people who move just to get out of their crappy MA plan. They get sick, and then get sick of dealing with limited network and say "to heck with this" and move, giving them the opportunity to get into Traditional Medicare. So that's probably a "thing", but a "small thing".

It’s incredibly disruptive to move not to mention expensive. Plus you are uprooted from all your social connections as well as your current healthcare providers. I suspect very few actually do this.

 

[DrRoy]

Is anyone aware if Humana has ever done a 'closing the books'?

 

[MBSC]

It appears to me that the state MA plan providers, whose rates were never publicly displayed in one place...

MA plans, premiums, and cost sharing have been on Medicare.gov for many years. It's the radio button above the one for Part D drug plans.

Unfortunately, Illinois has decided to no longer publish companies' supplement rates starting this year. In years past one could compare what the various rates were between companies, plans and age in one simple document.

Several states, including NC, have removed Medigap rates from their DOI website because they are now available on Medicare.gov. It's the radio button below the one for Part D drug plans. North Carolina DOI provides this direct link if you don't want to start from the homepage.

https://www.medicare.gov/medigap-supplemental-insurance-plans/#/m/?year=2024&lang=en

Total lack of transparency is not the solution to partial information.

This gives more transparency of Medigap plans and rates for states like Texas, which previously had zilch available.

 

[MBSC]

Humana has a plan N that is...$24/mo less than UHC N. It is still better than UHC at age 80. Does anyone know of issues with Humana N, or is this my best option?

Is anyone aware if Humana has ever done a 'closing the books'?

The Humana age 80 premium assumes they don't close the current book to new enrollees. Here is a Humana rate increase request for a closed block in MI. You will need to decide if the guaranteed premium savings today will be enough to offset potentially higher rates later.

From the attachment:
2) POLICY INFORMATION
Plans B, F, F-HD, K, L, and N are guaranteed renewable individual policies which are no longer being sold.

 

[RetiredHappy]

I don't understand the "guarantee issue". We moved out of CA (Kaiser-Medicare Advantage) and my husband applied to go on a Supplement F plan in the new state. He was offered tier 3 pricing (3 times regular Plan F price) due to underwriting/pre-existing condition. He was outside the 65-67 2-year no underwriting exemption age.

When is guarantee issue applied? I have never heard of it.

 

[Wile E. Coyote]

F for Following...

 

[Dash man]

I don't understand the "guarantee issue". We moved out of CA (Kaiser-Medicare Advantage) and my husband applied to go on a Supplement F plan in the new state. He was offered tier 3 pricing (3 times regular Plan F price) due to underwriting/pre-existing condition. He was outside the 65-67 2-year no underwriting exemption age.

When is guarantee issue applied? I have never heard of it.

See post #22

 

[RetiredHappy]

See post #22

I did read it and hence I am puzzled by it. No one is "guaranteed" once outside of the 2 years, or if person was covered by employer or union and it is ending.

 

[MBSC]

Here are some open book rate increases for Plans G and N. Does not include UHC or BCBS.

https://lp.newhorizonsmktg.com/medicare-supplement-rate-changes

 

[sengsational]

I did read it and hence I am puzzled by it. No one is "guaranteed" once outside of the 2 years, or if person was covered by employer or union and it is ending.

If you move, and you provide proof of coverage, you should be able to get into any Medicare policy without underwriting, irrespective of any number of years. I'm not a huge fan of brokers for people that aren't well-informed beforehand, but if you know what you want, I'd call a broker and they know how to make sure you get the guaranteed issue rates.

 

[CRLLS]

MA plans, premiums, and cost sharing have been on Medicare.gov for many years. It's the radio button above the one for Part D drug plans.

Several states, including NC, have removed Medigap rates from their DOI website because they are now available on Medicare.gov. It's the radio button below the one for Part D drug plans. North Carolina DOI provides this direct link if you don't want to start from the homepage.

https://www.medicare.gov/medigap-supplemental-insurance-plans/#/m/?year=2024&lang=en
This gives more transparency of Medigap plans and rates for states like Texas, which previously had zilch available.

As I recall 7 years ago, I did searching on the Medicare site and found a very similar data that it now shows. I get that having the Medicare site may provide more transparency than in some states. I went to your linked page and played with it for a bit. It is a very awkward site compared to what Illinois offered up to this year. Illinois had a single PDF document that showed each provider's plans they offered and pricing for every 5 year age group from 65 thru age 85 IIRC. in a table format. Each provider had everything in their own small table format. One didn't have to click thru different pages to look back and forth as the Medicare site does. Just scroll thru the document.

Alas, not everything that worked so well, is carried on forever.