Aging has its benefits. You carry more experience, you’re wiser, and you get a discount at your favorite breakfast spot. Another advantage is that you no longer have to get health insurance through an employer, which is great because you’ve worked hard and earned your retirement. Therefore, when you reach the age of 65, you can sign up for Medicare. But Medicare isn’t free. Consequently, you must decide how much coverage you’d like to pay for.

Before you sign up, you need to choose between Original Medicare (Part A and Part B) and Medicare Advantage plans. Once you make that choice, you may choose to also sign up for Supplemental Insurance, otherwise known as Medigap, and other additions such as drug coverage.

Some make these decisions based on the coverage they know they need, while others make the choice based on cost. Unfortunately, the premium cost of a medicare plan is not the same across the board, so it takes some clarification and some math to figure out what your exact costs for monthly premiums will be.

Medicare can be quite confusing to understand, but our team at Patriot Insurance Brokers knows Medicare, and we can help to make sense of all of this confusion. To help you begin to understand whether you need or can afford supplemental insurance, here’s an explanation of how to determine the cost of medicare supplemental insurance.

What is Medicare Supplemental Insurance?

Original Medicare consists of Part A-Hospital Insurance and Part B-Medical Insurance. Medicare coverage for these two parts only covers 80% of your medical bills. Therefore you can sign up for a Medicare Supplemental Insurance plan that helps to cover the remaining 20% of the health care cost.

Depending on what your chosen plan offers, Medicare Supplement plans may cover the Part A and Part B coinsurance and copayments. Though, due to recent changes, it no longer covers the Part B deductible.

Do I Have to Purchase Medicare Supplemental Insurance?

No, it is not a requirement that you carry Medicare Supplement Insurance in order to carry Original Medicare or Advantage plans. It is entirely up to you if you would like to pay for the extra coverage that supplemental insurance offers. It may be a wise choice to carry it, though, if you cannot afford to pay for the coinsurance or copays out of pocket.

How is Supplemental Insurance Cost Determined?

Based on Your Age

Depending on your plan and insurance company, your age may play a factor in the amount you pay for your policy. If you choose a community-rated plan, then your age is not a factor. If your plan is Issue Age Rated, then the younger you are when you lock into a plan, the lower your cost will be. Lastly, if you choose an attained age-rated plan, your prices will be low in the beginning but will increase with age. This type of plan can become quite expensive if you remain healthy and live for a long time.

Based on Type of Plan

Typically, the more comprehensive the plan is, the more expensive it is. Therefore if you want to obtain more coverage, you will be paying a higher price in premium costs. The reverse is also true. If you choose a high deductible plan, then your monthly premium will cost less. This is helpful if you are on a low fixed income or if you know you will not need much medical assistance in the near future.

It is important to note that Plan F and Plan C are being phased out and are no longer available for sign-ups as of Jan 1, 2020.

Based on Insurance Company

Medigap insurance is offered through private insurance companies to “fill in the gap” for Original Medicare. Therefore, each company will have very different plan offerings. For instance, some plans will require medical underwriting to ensure that you meet certain health standards. Some companies will offer guaranteed issue plans that do not require medical exams or questionnaires as a requirement for signing up. These are great options for those who do not qualify for typical plans.

Based on Location

Geographic location can affect the supplemental insurance plans that are offered to you. In many states, Medicare Supplemental plans are standardized, but in a few states, including Minnesota, there are a few differences. For instance, Minnesota supplemental plans are not referenced by letter as in other states. Here, there is a Basic plan and an Extended Basic plan. Coverage can also be customized with riders to the basic plan.

You can seek treatment in any state that offers Medicare, but if you have purchased Medicare in Minnesota and plan to move to a different state, make sure you review your plans to ensure your coverage does not need to change.

What is the Average Cost of Supplemental Insurance?

As you can see, the cost of supplemental insurance is not one-size-fits-all and depends on a number of factors. In most cases, though, the average cost of Supplemental Medicare Insurance in Minnesota without riders is around $190 per month. This number may be higher or lower based on your specific circumstances and needs. Therefore this number should only be used as a ballpark number for determining if you are interested in purchasing supplemental insurance. In many cases, insurance agents will be able to give you a more specifically tailored quote after asking a few questions about you and your family’s needs.

How Do I Sign Up for Supplemental Medicare Insurance?

There are many ways to sign up for Medicare online, over the phone, or through an agent. We highly recommend that you do not sign up for Medicare or Supplemental insurance on your own or without hearing all of your available options. This is not because we do not think you are capable, but because we know that there are many ways to ensure that you are getting the best deal available to you.

At Patriot Insurance Brokers, our number one goal is to ensure you get the exact plan you need for the price you can afford. It is our pleasure to explain your options and shop around to find the best deal for you. We believe you have worked hard for your peace of mind.

If you need assistance understanding Supplemental Medicare Insurance, or if you are ready to hear about the plans available, give us a call at (888)-232-2583 to get started today.