Blog / Medigap

Why do Medigap prices differ by company for the same plan?

The same Medigap letter buys the same benefits at every company. What changes is the pricing method, the health questions and the rate history.

Updated September 3, 2026 · 3 min read · by Gerino Alejos

Because the benefits are set by law and the price is not. The same letter, say Plan G, pays the same bills no matter whose name is on the card. What changes is how each company sets its rates, who it lets in, and what its own members have cost it.

A premium is the monthly bill for the coverage, and the premium is the only piece that moves.

What drives the difference

These things move the price. None of them change what the plan pays.

• The pricing method. Attained age climbs as you age. Issue age locks the rate to the age you bought at. Community rated charges everyone in the area the same. The three land far apart at 65, and farther apart at 80.
• Underwriting, which means the company can look at your health history and say no. One that lets in more health problems pays more claims, so it charges more.
• Claims experience, which is what that company's own members have cost it. It runs high in one state and low in another.
• Market strategy. Some companies open low to pull in members, then raise the rate later. Others start steady and stay there.
• Running costs, including what the company spends to find customers.
• Discounts, such as a household discount, a non tobacco discount, or paying once a year.

The closed block effect

A block of business is the group of people holding one company's version of a plan. When it closes to new members, that group grows older together and no younger, healthier people come in behind them. Claims go up, and the price follows.

That is why Plan F, closed to people who became eligible for Medicare after 2020, often climbs faster than a Plan G beside it. See Plan F next to Plan G.

What is not different: the coverage

• The benefits. Federal law writes the letter, so the same letter pays the same way everywhere.
• The network, the list of doctors a plan contracts with. Medigap has none. Any doctor who takes Medicare works.
• The claims process. Medicare pays its share first and passes the rest along on its own.
• Whether you can be dropped. Every Medigap policy is guaranteed renewable, so the company cannot cancel you for using it.

How to judge a low quote

1. Ask which pricing method it uses. A low attained age quote at 65 can be the costly one at 80.
2. Ask what its rate increases have looked like over the past several years.
3. Ask whether a first year discount sits inside the quote and drops off later.
4. Check its financial strength rating, a grade an outside firm gives on its ability to pay claims.
5. Ask how long it has sold Medigap in Texas.

A low price from a steady company with a mild rate history is a good deal. A low price from one that has raised rates sharply is a cost you pay later.

How to choose

The product is the same, so there is no reason to pay more than you have to, once you have checked the rate history and the pricing method.

What stops people is underwriting. In Texas, switching later means answering health questions. So getting the price right during your open enrollment window, when no company can turn you down over your health, is worth more than fixing it later.

See how to compare rates properly and when your window opens. To go through the pricing methods and rate histories with us, call our McAllen office at (956) 687 3334, or enter your ZIP code in the plan pricing box on this page.

Gerino Alejos

Licensed insurance agent · License 3128710 · NPN 18243381

Owner of McAllen Insurance Group, an independent agency on North 10th Street in McAllen. Works with clients across Hidalgo, Cameron and Starr counties on Medicare, Marketplace health, life and auto coverage. Se habla español.