Medicare Supplement

Same Plan G benefits, very different Montgomery premiums

In Montgomery, shopping for a Medigap policy can feel confusing — until you learn one useful fact: a Medigap Plan G from one company covers exactly the same things as a Plan G from any other company. The letter is the coverage. What changes is the insurer behind it, the way that insurer sets its price, and the rules it uses if you apply outside a guaranteed-issue window.

Medicare SupplementMontgomery, AL

Montgomery is in Montgomery County, where Alabama residents can choose from more than 20 insurance companies licensed to sell Medigap. Because the benefits inside each lettered plan are set by federal rules, the smart move is to pick the letter first, then compare insurers on that same letter side by side.

Start with the letter, not the company

People newly eligible for Medicare today can choose from Plans A, B, D, G, G-HD, K, L, M and N. Plans C and F remain available only to people who were eligible for Medicare before January 1, 2020.

Each letter is a defined package of benefits set by federal law. That means a Plan N sold by one company in Montgomery pays the same share of your Part A and Part B costs as a Plan N sold by another company. If a friend tells you their Plan G "covers more" than yours, the benefits are the same — the price, the service and the insurer's rules are what differ.

The table below lists every insurer selling Medigap in Alabama and which letters each one offers.

Which insurers sell Medigap in Alabama

More than 20 companies file Medigap rates with the Alabama Department of Insurance. In alphabetical order, they include AARP - UnitedHealthcare Insurance Company, AFLAC, American Benefit Life Insurance Company, Atlantic Capital Life Assurance Company, Bankers Life (Washington National), BlueCross BlueShield of Alabama, Continental Life Insurance Company of Brentwood, Tennessee (Aetna), GPM Health and Life Insurance Company, Guarantee Trust Life Insurance Company, HealthSpring Insurance Company, Humana (Emphesys), Insurance Company of North America, LifeShield National, Lumos Insurance, Mutual of Omaha (Omaha Insurance Company), Nassau Life, New Era Life, Physicians Mutual, State Farm Mutual Automobile Insurance Company, United American Insurance Company, USAA Life Insurance Company and WoodmenLife.

Not every company sells every letter. For example, BlueCross BlueShield of Alabama offers Plan A only, while United American offers a long list including A, B, C, D, F, F-HD, G, G-HD, K, L and N. The full breakdown is in the table on this page.

The three ways insurers price the same letter

Two people can buy the same Plan G on the same day at different companies and pay different amounts, largely because insurers use different pricing methods. In Alabama, the three you'll see are:

• Attained-age rated. The premium is based on your current age and typically increases as you get older.
• Issue-age rated. The premium is based on how old you were when you bought the policy. It doesn't rise just because you age, though it can still increase for other reasons like inflation or medical trend.
• Community rated. Everyone in the same area pays the same base premium regardless of age.

None of these methods is "better" — they simply behave differently over time. Ask each insurer, in writing, which method it uses for the letter you're considering, and ask for its recent rate-increase history in Alabama. The state rate guide is a good starting point.

Household discounts and underwriting

Many Alabama Medigap insurers offer a household or spousal discount when two people in the same home enroll, or when one spouse enrolls alone but qualifies based on the living situation. The size and rules vary by company, and it's one of the biggest reasons the same letter can cost noticeably different amounts across insurers.

Underwriting is the other big factor. During your six-month Medigap Open Enrollment Period — which starts the month you're 65 or older and enrolled in Part B — insurers must sell you any plan they offer, at their published rate, without asking about your health. Outside that window (and outside a handful of guaranteed-issue situations), most Alabama insurers can ask health questions and either decline you or charge more based on your medical history.

That's why timing matters as much as the company you choose.

A simple way to compare, step by step

1. Decide which lettered plan fits your budget and risk tolerance (for example, G, G-HD or N). 2. Pull up the Medigap policy search at Medicare.gov and enter your Montgomery ZIP code to see every insurer offering that letter. 3. Ask each insurer for its pricing method, current rate for someone your age, rate-increase history, and any household discount. 4. If you're outside Medigap Open Enrollment, ask whether the plan is being offered on a guaranteed-issue basis or requires underwriting. 5. Check the Alabama Department of Insurance rate guide and call your local SHIP for a free, unbiased second look.