Why did my Medigap premium go up?
Three separate causes, and only one of them means you should shop. Here is how to tell which happened to you.
Medigap premiums rise. It is expected and it is not a sign that anything went wrong. What matters is which of three causes applies, because only one of them means you should do something.
Cause one: your age
Most Texas policies are attained age rated, meaning the premium increases as you get older. That increase happens on a schedule regardless of claims or anything else.
Attained age policies are cheapest at 65 and most expensive at 85. If yours is attained age rated, an annual bump is simply the design.
Cause two: a general rate increase
Carriers file rate increases to reflect medical inflation and claims experience across their whole block of policyholders. This applies to everyone with that plan from that company, not to you specifically.
Some carriers have a long record of moderate increases. Others price aggressively to win new business and raise sharply afterward. That pattern is worth knowing before you buy, and it is worth checking now.
Cause three: a closed block
This is the one that should make you shop. When a plan is closed to new members, such as Plan F for people newly eligible after 2020, the pool ages together with no younger entrants. Claims rise, premiums follow, and the increases compound. A closed block policy can drift well above the market for identical coverage.
See Plan F versus Plan G.
What it is never
Your premium did not go up because you filed claims or because you got sick. Medigap policies are guaranteed renewable and rates are set by class, not by individual. A carrier cannot single you out.
What to do about it
- Find out which pricing method your policy uses. Attained age, issue age or community rated. Your carrier can tell you.
- Get quotes for the same plan letter from several other carriers. Since coverage is standardized by law, this is purely a price comparison.
- Ask each about their rate increase history over the last several years, not just the opening premium.
- Ask about household discounts, which many carriers offer when two people in a home hold policies.
- If a switch makes sense, apply and get written approval before cancelling anything.
See how to compare rates.
The underwriting problem
Here is the difficulty. Switching requires passing medical underwriting in Texas outside a guaranteed issue situation. Premiums typically become uncomfortable at the same age when your health makes underwriting harder.
So shop while you are healthy rather than waiting until the premium forces the issue. And never cancel an existing policy before a new one is approved and in force.
If you cannot switch
- Consider a different plan letter with the same carrier, such as moving from G to N, which some carriers will do with lighter or no underwriting.
- Consider a high deductible version for a much lower premium. See high deductible Plan G.
- Ask about any discounts you are not receiving.
- If the premium is genuinely unaffordable, a Medicare Advantage plan cannot decline you. Understand that returning to a supplement later would face underwriting.
Common follow-up questions
Did my premium go up because I used my policy?
No. Medigap rates are set by class, not by individual claims, and policies are guaranteed renewable.
Which pricing method is best?
Issue age or community rated cost more at 65 and less later. Attained age is cheapest at 65 and most expensive later. Ask which yours uses before comparing quotes.
Should I switch carriers every year?
No. Switching requires underwriting each time. Compare every couple of years and move when the gap is meaningful.
Want this looked at properly?
We are an independent agency in McAllen serving Hidalgo, Cameron and Starr counties. No cost to talk it through.
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What is Medigap (Medicare Supplement insurance)?
Medigap