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Medigap pricing-Community pricing vs Attained Age Pricing?
Old 12-14-2019, 02:26 PM   #1
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Medigap pricing-Community pricing vs Attained Age Pricing?

I start Medicare Feb 1, 2020 so I've been shopping and learning.

I've decided on a Medigap Plan G. I thought I was all decided on AARP/United HealthCare for $114.22/mo. I liked that they use Community Pricing. Then I talked to Boomer Benefits. They were very helpful, answered a lot of questions and sent me an email with a .pdf of all my plan options and rates.

Boomer Benefits recommended Mutual Of Omaha Plan G $112.70/mo. which has Attained Age pricing. Highly rated according to Boomer Benefits. I asked about the AARP Plan G and the Community pricing. He told me that Ohio is an attained age state and that all companies raise their rates due to inflation.

So I'm a bit confused. I was liking that AARP has a large discount that gets smaller every year and that they are open about their prices. I've heard great stuff about Boomer Benefits so I want to seriously consider their advice to go with Mutual of Omaha.

So with all the folks on Medicare here, what's your experience with rate increases for these 2 companies? Is Attained Age pricing vs Community pricing going to make a difference over many years? If Ohio is an "attained age state" what does that mean for AARP/UnitedHealthCare Community pricing? I wish I would have asked that when I had the Boomer Benefits guy on the phone.

And another thing I'm dealing with is that many of these companies offer a 5%-7% discount of another person in your household enrolls with the same company. DH starts Medicare in April, 2020 but he has to go through his pension plans connector Via Benefits in order to get his HRA allowance. It looks like he has options form only 7 Medigap insurers and my choices for me of Mutual Of Omaha or AARP/UnitedHealthCare are not in his options.
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Old 12-14-2019, 02:37 PM   #2
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Sue J, I'm not sure how helpful this information will be, but I do have some very limited experience with Mutual of Omaha (MoO) rates.

DW and I went through Boomer Benefits to switch to a MoO Plan N supplement last year. They offer a 12% discount if we were both insured with them which was a nice incentive to choose them. After the first year they raised our rates (Texas) by 6%, and I saw info stating they increased G and F rates by 10%.

Good luck in whatever you decide.
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Old 12-14-2019, 03:04 PM   #3
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Hopefully this from Kaiser will help.

Quote:
... There are three different rating systems that can affect how Medigap insurers determine premiums: community rating, issue-age rating, or attained-age rating (defined in the Text box below). States can impose regulations on which of these rating systems are permitted or required for Medigap policies sold in their state. Of the three, community rating provides the strongest consumer protection for Medigap policies because it does not allow premiums to be based on the applicant or policyholder’s age or health status. However, insurers in states that require community rating may charge different premiums based on other factors, such as smoking status and residential area. In states that allow attained age rating, older applicants and policyholders have considerably less protection from higher premiums because premiums may increase at unpredictable rates as policyholders age.

Premium rating systems
Community rating: Insurers must charge all policyholders within a given plan type the same premium without regard to age (among people age 65 and older) or health status. Insurers can raise premiums only if they do so for all policyholders of the given plan type. Insurers may still adjust premiums based on other factors, including smoking status, gender, and residential area.

Issue-age rating: Insurers may vary premiums based on the age of the policyholder at the time of purchase, but cannot increase the policyholder’s premium automatically in later years based on his/her age. Additionally, insurers may charge different premiums based on other factors, including health status, smoking status, and residential area.

Attained-age rating: Insurers may vary premiums based on the age of the policyholder at the time of purchase and increase premiums for policyholders as they age. Additionally, insurers may charge different premiums based on other factors, including health status, smoking status, and residential area.

Currently, eight states (AR, CT, MA, ME, MN, NY, VT, and WA) require premiums to be community rated among policyholders ages 65 and older. This means that Medigap insurers cannot charge higher premiums to people because they are older or sicker, and therefore, must charge an 80-year old policyholder the same as a 70-year old policyholder regardless of health status (Table 4). Insurers may still adjust premiums based on other factors, including smoking status, gender, and residential area. A state’s community rating requirement does not, in itself, guarantee that applicants will be issued a policy in the state. However, as described earlier, four of the states that have community rating (CT, MA, ME, NY), have guarantee issue protections and require insurers to issue Medigap policies to eligible applicants either continuously during the year, or during an annual enrollment period. ...

https://www.kff.org/medicare/issue-b...across-states/
With community rating, premiums are the same for a 65yo or a 90yo. Attained age is similar to ACA in most states... premiums increase as you get older so your annual premium increases will be higher. So given that the age 65 premiums are similar I would think the AARP policy is a better deal as premium increases would be less (I think).

We are going through a similar exercise with Boomer Benefits for DW right now. AARP/UnitedHealthcare were one of the companies that they quoted (in Florida) but it might be that they don't represent AARP/UnitedHealthcare in Ohio. AARP was the lowest premium but they recommended Aetna because Aetna would be a lower premium after the household discount which we will qualify for once I start Medigap later in 2020 and AARP didn't offer a household discount.

Quote:
... The majority of Medigap policies issued in Ohio are attained-age rated, according to the Kaiser Family Foundation (KFF). ...

https://www.medicaresupplement.com/medigap/state/ohio/
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Old 12-15-2019, 07:01 AM   #4
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When the agent said OH is an attained-age state, it simply means attained-age plans are allowed to be sold there. Some states prohibit attained-age Medigap plans. In states where attained-age plans are allowed, UHC uses a hybrid pricing method based on a community rate. The community rate is discounted in the early years to compete with attained-age plans. This makes it act like an attained-age plan before age 81 with rate changes for both age and inflation/risk pool health status. Then the full community rate starts with only the inflation/pool health adjustment.

Most agents have blinders on and only consider the first year rate. Consumers need to consider the long term. MOO has a history of "closing the books" on a plan and opening another under a different subsidiary name. Those stuck in the old plan because they can't pass underwriting generally face steeper rate increases as the enrollment pool shrinks. MOO pays a higher commission (~22%) than UHC (~17%). The agent is there to make money and FIRE regardless of the name on the broker's door.

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Originally Posted by Sue J View Post
DH starts Medicare in April, 2020 but he has to go through his pension plans connector Via Benefits in order to get his HRA allowance. It looks like he has options form only 7 Medigap insurers and my choices for me of Mutual Of Omaha or AARP/UnitedHealthCare are not in his options.
FWIW, MOO plans are currently sold under the United World Life name in OH.

2019 Ohio Medigap Guide - page 15, United World Life (website mutualofomaha.com): https://insurance.ohio.gov/wps/wcm/c...222b0c-mS8X21w
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Old 12-15-2019, 09:30 AM   #5
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Originally Posted by pb4uski View Post
AARP was the lowest premium but they recommended Aetna because Aetna would be a lower premium after the household discount which we will qualify for once I start Medigap later in 2020 and AARP didn't offer a household discount.
pb,

Can you explain the household discount? Does every company offer this? Is there an age gap limitation? DW and I are 5 1/2 years apart, so she won't need to sign up for few more years.

thanks
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Old 12-15-2019, 01:42 PM   #6
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I'm a newbie to Medigap plans, but my understanding is that its akin to the discount you receive for buying both home and auto with the same carrier... offered to couples who both buy Medigap plans with the same carrier, so not available to you for 5 1/2 years and then only if the carrier offers it and you and your DW are with the same carrier.
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Old 12-15-2019, 01:44 PM   #7
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Can you explain the household discount? Does every company offer this?
Not all Medigap insurers offer a household/partner discount. For those that do, I've seen the discount amount range between 4 and 12 percent.
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Old 12-15-2019, 11:55 PM   #8
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Originally Posted by REWahoo View Post
DW and I went through Boomer Benefits to switch to a MoO Plan N supplement last year. They offer a 12% discount if we were both insured with them which was a nice incentive to choose them. After the first year they raised our rates (Texas) by 6%, and I saw info stating they increased G and F rates by 10%.
When I was with MoO, the 12% discount was for everyone, if they had at least one, but not more than three (I think it was three) other adults living with them. The other person(s) did not need to be on MoO insurance.

The increase in TX and some other states was 15%, not 10%, for Plans F & G. That was the first increase after they closed the book that I had enrolled under.
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Old 12-16-2019, 12:16 AM   #9
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Originally Posted by Sue J View Post
so I want to seriously consider their advice to go with Mutual of Omaha.
uh, it remains "buyer beware". Be advised that MoO offers some healthy incentives to brokers to sign people up with them. MoO plays the "book game", where they have low rates and no rate increases for a few years, to rake the people in at a low inviting rate, then they close the book, no new entrants allowed. The new entrants instead, are signed up into the next book that has been opened. From my observation and experience, they do a name change for each book change. I was signed up into MoO's "United World", that closed with me trapped in it. I forget the name of the new book opened, but it will vary by state.
I felt really burned by the whole situation. So I went through medical underwriting to go to AARP/UHC. Which I was able to do, due to very good health. But there is no guaranty that my, or anyone's health will stay that way, of course. My advice... keep your critical eye open, and be skeptical. I also suggest carefully re-reading MBSC's post in this thread, great info there!

I am reminded of the Faces (Rod Stewart) song line -
"I wish, that, I knew what I know now, when I was younger..."
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Old 12-16-2019, 04:23 AM   #10
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Thanks for those details. The whole close the book practice with subsequent large increase by MOO makes me very nervous.
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Old 12-16-2019, 06:30 AM   #11
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Thanks for those details. The whole close the book practice with subsequent large increase by MOO makes me very nervous.
+1

Unfortunately the close the book strategy isn't only limited to MoO. It appears to be common practice for all but UHC/AARP and a few small insurers (I'm sure MBSC will correct me if this is inaccurate). I think you'll find their rates to be initially higher, thus my belief Medigap cost is a choice between "pay me now or pay me later".
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Old 12-16-2019, 06:49 AM   #12
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I wasn’t aware of a family discount and chose BCBS for DW and UHC/AARP for me. The low cost MediGap policy in Florida is United American, they advertise heavily in the local newspaper with the slogan “We’re here to stay”. Somehow that leads me believe just the opposite.

I agree with REWahoo’s view that health insurance is pay now or pay later.
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Old 12-16-2019, 08:46 AM   #13
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We just changed from an "attained age" BCBS plan to a AARP "community" rated plan. The BCBS did not offer a family discount. The AARP/UHC plan does. Bear in mind that the only measurable difference in providers of any given plan letter is premium and service. I had done research on MOO and based on that research, decided that I would not go with them. YMMV.

Illinois has a great website that lists the current premiums for Medigap plans for every age, in 5 year increments. It really showed me which company has unrealistic lower starting rates to get me in the door and helped me make my decisions. I don't know if every state does that. The differences in premiums as one gets further along in age and changing companies is not as easy due to underwriting is clear.

Even though Medicare is a national program, every state has its own rules, plans and premiums for Medigap plans. This also makes it tough for us here to discuss on a level playing field.
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Old 12-16-2019, 08:50 AM   #14
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I know you can get UHC independently, but sounds like you need the AARP membership to ultimately get the 5% discount when two of you are on Medicare?
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Old 12-16-2019, 10:22 AM   #15
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FWIW, you also need to signup for ARRP/UHP Medigap under the same AARP membership number to get the discount. Ask me how I know! For those with automatic withdrawals, there is one transaction for the combined amount.
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Old 12-16-2019, 10:33 AM   #16
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It’s disappointing to hear that your husband’s choices are limited buying through via benefits. I have to buy through them in order to keep the state paying for my part b premium.
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Old 12-16-2019, 11:49 AM   #17
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It’s disappointing to hear that your husband’s choices are limited buying through via benefits. I have to buy through them in order to keep the state paying for my part b premium.
A few years ago they used to pay for the retirees Part B and before that, even the spouse's Part B! Now it's an allowance to be used to reimburse for whatever expenses you have. For DH it's $337.50/mo so still a nice amount.

I went back to DHs Via Benefits site and now AARP is included. I may have missed it before or possibly a glitch with the site? I was glad to see that it's there now.

Thanks to all the posters commenting on Mutual of Omaha and Boomer Benefits tactics. Very eye opening. I knew that asking here would yield clearer advice than asking an insurance sales agent.

Here's another question. DHs Via Benefits shows a Plan G with a very local insurer, Medical Mutual. Here in Northeast Ohio they are very recognizable. Is there an advantage or disadvantage in going with a local Medigap Company? If it was for a Medicare Advantage it would mean a local network. But what does this mean to a Medigap plan? I'm asking because they have the lowest rate for a Plan G with Via Benefits, although it's just under AARP/UHC with the household discount.

My hesitations in making this decision are that it seems like I'm making a very long term decision based on prices that are unknown in the future. I guess that applies to a lot of things but we all know how unpredictable health care costs are.

I very much appreciate all the comments coming from people who have been on Medicare for a while.

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FWIW, you also need to signup for ARRP/UHP Medigap under the same AARP membership number to get the discount. Ask me how I know! For those with automatic withdrawals, there is one transaction for the combined amount.
Ah. Good info to know ahead of time.
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Old 12-16-2019, 03:43 PM   #18
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I have Mutual Of Omaha Plan G and so far my price increases have been very low for the 3 years I have had them. I went with them because 3 years ago UHC AARP did not have a Plan G. I have looked at the AARP plan and my premium is significantly lower with Mutual of Omaha (about $50 per month lower) so I am staying with Mutual Of Omaha for now. Mutual of Omaha has been very good to deal with.
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Old 12-16-2019, 04:20 PM   #19
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I know you can get UHC independently, but sounds like you need the AARP membership to ultimately get the 5% discount when two of you are on Medicare?
The first spouse to sign up needs to have an AARP membership when you sign up. The second spouse can be added to that membership for free. You both sign up under that membership to get the discount on each one.

Once you are both signed up you don't have to continue the AARP membership unless you want to.

We ended up doing AARP UHC for two reasons. First, they are very open about their pricing. It is very clear how it works. By the time I signed up DH had been on it for several years. Each year for him, the price adjusted twice. It adjusted in June for the annual inflation adjustment. This have been small and not unreasonable. Then it would adjust on his birthday to reflect his lower discount. There will come a time when the discount is over and then the price stays the same. That is a nice benefit. My mother had Plan G with an attained age company when she died at 94. Her premium was quite large.

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Here's another question. DHs Via Benefits shows a Plan G with a very local insurer, Medical Mutual. Here in Northeast Ohio they are very recognizable. Is there an advantage or disadvantage in going with a local Medigap Company? If it was for a Medicare Advantage it would mean a local network. But what does this mean to a Medigap plan?
IT means nothing. All Plan G Medigap policies cover the same things. Theoretically one company might be more efficient to talk to or make fewer mistakes, etc. But, really, they kick in and pay after Medicare has paid and pay according to the plan. There is no real advantage to picking a local company. There are no networks.
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Old 12-17-2019, 05:14 AM   #20
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I have Mutual Of Omaha Plan G and so far my price increases have been very low for the 3 years I have had them. I went with them because 3 years ago UHC AARP did not have a Plan G. I have looked at the AARP plan and my premium is significantly lower with Mutual of Omaha (about $50 per month lower)...
For a 68 yr old male in NC, UHC/AARP Plan G is $116.79 including $2 EFT discount. MOO is $122.07. All rates are before household discount.

The $183 UHC rate on the NC DOI website is the community rate for those age 81+. To compete with attained-age plans, UHC discounts the community rate for ages 65-80. Clicking on the UHC name displays the discounts. A new discount formula is used for 2020 plan enrollments.

UHC Pricing Source: https://www.uhcmedicaresolutions.com...ent-plans.html

MOO Pricing Source: https://www.mutualofomaha.com/medica...epage-priority

Quote:
NC DOI Medigap Rates: NCDOI | Medicare Supplement Premium Comparison Database

Early Enrollment Discounts Available - effective dates July 1, 2017 or later - at age 65 - 36% and reducing 3% annually until discount runs out.

Effective dates prior to July 1, 2017 - at age 65 - 30% and reducing annually.
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