How to Make the Right Medigap Choice

logo-collage-smallChoosing the right Medigap plan can be a time-consuming and overwhelming process if you allow it to be. While there is a lot of information out there and a lot of people and companies vying for your “attention”, choosing a Medigap policy does not have to be difficult. Follow this three-step guide to narrowing the choices, reducing the clutter and selecting the plan that is right for you.

  1. Understand the plans. First of all, you must have an understanding of the plans – what they cover, how they work and what is important in the decision-making process. The first thing to know is that the plans are Federally-standardized. That is, all companies provide the same coverage plans – a Plan F with one company is the same as a Plan F with another company. Additionally, the plans all work the same way. Claims are automated (paid electronically without involvement from the patient), and they are done through the Medicare “crossover” system. Lastly, all plans can be used at any doctor or hospital that takes Medicare. In other words, as long as a physician takes your primary coverage (Medicare), they will take your Medigap plan regardless of what Medigap company sold you the plan.In summary, and the main thing to understand when it comes to Medigap plans, is that there are no differences to compare as far as coverage, reliability, how the plan works, where you can use it, etc. The two factors to compare when it comes to Medigap are price (first and foremost) and company rating/reputation. The Federal standardization of plans has made the other variables non-existent or irrelevant.
  2. Compare the rates. Once you understand “what” to compare, it is time to actual do the comparing. There are a couple of ways to do this. The “old-fashioned” way is to get the phone numbers of all companies offering Medigap plans in your area and call them and ask their rates. Some companies will give you this information over the phone; some will require that an agent come to your house to meet with you prior to giving you the information. For most people, this way of doing it is not appealing. However, it is an option.The other way of going about it – which I believe most people would find preferable – is to use an independent agent, or broker, to compare the plans. An independent agent does not work specifically for one particular insurance company, so they are not going to try to “sell” you on their company. Instead, they can give you unbiased information of what company’s offer competitively priced plans in your area. Additionally, they can provide other information such as company rating, past rate stability and reputations, which may help you narrow down the choices and make an informed decision.Keep in mind that the main thing to compare when it comes to Medigap (Medicare Supplement) plans is the rates, as plan coverage is completely standardized by the Federal government. A good independent agent can provide a full breakdown of the companies that offer companies in your zip code, as well as what the rates would be for someone at your age.
  3. Choose wisely. Once you have the information that pertains to premium rates and company rating/reputation, you can easily narrow the choices to which reputable companies are competitively priced for your area. While many people know about Plan F, which is the most common plan, it is not always the most wise choice. It is the most comprehensive but also the most expensive. Plan G is an alternative that typically would provide a savings when compared to Plan F – under Plan G, you have to pay a $147/year deductible but that’s the only difference between ‘F’ and ‘G’ and the premium savings is often $300+/year resulting in a significant net savings.Once you choose a plan, it is easy to enroll, particularly if you are in an “open enrollment” period (i.e. turning 65 or just going on Medicare). Simply complete an application, which the independent agent can facilitate either online or by phone, then the application will be processed by the insurance company. You’ll receive an insurance card and policy in the mail.

While signing up for a Medigap plan is an overwhelming charge for many people, it does not have to be. The standardization of Medigap plans and the proliferation of information available online has made comparing and choosing a Medigap plan much easier than choosing most other types of insurance.

If you would like a listing of the companies/rates in your area or have other questions, you can contact us online or call 877.506.3378.