Medicare Supplement

Naples Medigap Buyers: Ask Which of 3 Pricing Methods Applies

# Naples Medigap Buyers: Ask Which of 3 Pricing Methods…

NAPLES, Fla. — If you've shopped for a Medicare Supplement (Medigap) policy along the Paradise Coast, you've probably noticed something odd. Two plans can spell out the exact same benefits — Plan G is Plan G, no matter who sells it — yet the premiums look nothing alike. And even after you buy one, the price can go up over the years, though the benefits themselves are locked in by federal rule.

The reason usually comes down to one question most Naples shoppers never think to ask: how is this policy priced?

Medigap insurers use one of three pricing methods, and each one behaves differently as you age. Understanding which method is attached to a policy — before you sign — can save you a lot of surprise later.

Why Medigap benefits don't change, but the price can

Medigap plans are labeled by letter — A, B, D, G, K, L, M, N — and each letter offers the same core benefits from every insurance company that sells it. That's set by federal rule and is one of the strengths of the Medigap program.

What is not standardized is the price. Each insurer decides what to charge, files those rates with the state, and can raise them over time. According to Medicare.gov, three broad factors typically push premiums up: your age (under some pricing methods), general inflation in health care costs, and the insurer's overall claims experience — meaning how much the company is paying out for the people in that policy pool.

So the benefits on your policy can't shrink, but the bill can grow.

Method 1: Community-rated (also called "no-age-rated")

Under community-rated pricing, every person who buys the same policy from the same insurer generally pays the same premium, regardless of age. A 65-year-old and an 80-year-old with the same Plan G from the same company pay roughly the same base rate.

Premiums can still rise over time because of inflation and claims experience — they just don't rise because you had a birthday.

Method 2: Issue-age-rated

With issue-age pricing, your premium is based on the age you were when you first bought the policy. Buy at 65, and your rate is tied to that starting age. Buy the same plan at 72, and you'll typically start at a higher rate.

The key point: after you buy, your premium doesn't automatically climb each year just because you got older. But it can still increase due to inflation and the insurer's overall costs.

Method 3: Attained-age-rated

Attained-age pricing starts low and rises as you age. Your premium is tied to your current age — your "attained" age — so it's recalculated as the years pass. On top of that, inflation and claims experience can push it higher still.

These policies often look like the most affordable option at 65. The catch is that the same policy usually costs more at 75, and more again at 85, even though the benefits haven't changed.

Which method is offered in Naples?

This is where it gets local. Which pricing methods insurers may use is regulated at the state level, and the mix of options can vary from one company to the next. Florida has its own rules about how Medigap can be sold and rated, but rather than assume what a specific company offers here, the smartest move is to ask each insurer directly, in writing, before you enroll:

• Is this policy community-rated, issue-age-rated, or attained-age-rated?
• What has your rate history looked like over the last several years?
• What factors trigger a premium change?

Naples is in Collier County, and residents can get free, unbiased help sorting through these questions from Florida SHINE, the state's federally funded SHIP counseling program.

A note on timing

Your best window to buy a Medigap policy is your six-month Medigap Open Enrollment Period, which starts the month you're 65 or older AND enrolled in Part B. During that window, insurers generally can't deny you coverage or charge more because of health issues. Outside of it, medical underwriting usually applies — and that can affect both whether you're accepted and what you pay.

Medigap enrollment is separate from the Medicare Advantage and Part D windows (Oct. 15–Dec. 7 for AEP, and Jan. 1–March 31 for Medicare Advantage Open Enrollment).