How to Manage Medicare Supplement (Medigap) Premium Increases
Medicare Supplement (Medigap) premiums tend to increase over time, often leaving seniors wondering why costs rise and what they can do to keep their expenses under control. In this guide, we’ll explore the reasons behind these increases and provide actionable strategies to help you find the best rates.
Why Do Medicare Supplement Premiums Increase?
Medigap premiums typically increase due to several factors, including:
- Age-Attained Pricing: Most Medigap plans charge premiums based on your current age. As you get older, your premiums automatically go up.
- Medical Inflation & Rising Healthcare Costs: Insurers adjust rates to cover higher healthcare expenses, prescription drug costs, and claims.
- New vs. Existing Customers: Insurers often offer lower rates to attract new customers while raising rates for existing policyholders.
- State Regulations: Some states allow premium increases based on specific rules, while others have protections like “birthday rules” that help limit rate hikes.
Understanding Early Enrollment (New to Medicare) Discounts
Many insurance carriers offer an Early Enrollment Discount (also called a “New to Medicare” discount) to encourage first-time enrollees to sign up at age 65.
- How It Works: These discounts significantly lower initial premiums but phase out over time.
- Are They Legal? Yes, but insurance companies must disclose how long the discount lasts and how much rates will increase afterward.
- Key Takeaway: If your premium suddenly increases, it could be due to the expiration of an early enrollment discount.
How to Minimize Medigap Premium Increases
Fortunately, you can take steps to reduce your Medigap costs:
- Compare Plans Annually: Many states, including Nevada, allow you to switch plans around your birthday without medical underwriting.
- Consider Community-Rated Plans: These plans charge the same premium regardless of age, reducing long-term cost increases.
- Take Advantage of Household Discounts: Many insurers offer 5%–12% discounts when multiple household members enroll.
- Consult an Independent Medicare Agent: Licensed agents can help you compare rates across all carriers to find better deals.
Get a FREE Medicare Supplement Rate Comparison Report from Medicare.org.
Our report gives you the essential details you need to make an informed decision—no sales pressure, just transparent information.
Medicare.org is owned by Allstate but operates independently to provide unbiased rate information. We prioritize education, transparency, and your trust.
Medigap Premium Increase Trends & What to Expect in 2025
Medigap premiums have been rising moderately over the past decade. In 2023, the average Medigap monthly premium was $217, with variations based on age, location, and plan type. With inflation and rising healthcare costs, moderate increases are expected to continue.
What to Do If You Receive a Large Premium Increase
If you notice a sudden jump in your Medigap premium, follow these steps:
- Review Your Notice: Check for explanations related to pricing structure, inflation, or the expiration of an early enrollment discount.
- Compare Rates with Other Companies: Different insurers have different pricing strategies, and you might find a better deal.
- Take Advantage of Special Enrollment Rules: Some states allow switching without medical underwriting during specific windows.
- Consider Changing Plans: If you’re in an expensive plan, you might qualify for a different Medigap plan at a lower cost.
Frequently Asked Questions (FAQs)
Do Medigap premiums always go up?
Most Medigap plans use age-attained pricing, meaning costs increase over time. However, community-rated plans do not increase premiums based on age.
What’s the average premium increase per year?
Medigap premium increases vary, but average annual increases range from 3% to 6% due to inflation and age-related adjustments.
Are there Medigap plans that don’t increase in price?
Community-rated Medigap plans do not raise premiums based on age, but they may still increase due to inflation and other factors.
Can I switch Medigap plans if my premium gets too high?
Yes, if your state has a birthday rule or guaranteed issue rights, you can switch to a different Medigap plan without medical underwriting.
Get Your Free Personalized Medigap Quote
Don’t overpay for your Medigap plan. Compare rates from multiple carriers and see how much you can save!
Conclusion
Medigap premium increases are inevitable, but you can take steps to manage costs. Compare plans annually, take advantage of state protections, and use resources like our FREE Medigap rate comparison service to ensure you’re getting the best deal.
Get a FREE Medicare Supplement Rate Comparison Report from Medicare.org.
Our report gives you the essential details you need to make an informed decision—no sales pressure, just transparent information.
Medicare.org is owned by Allstate but operates independently to provide unbiased rate information. We prioritize education, transparency, and your trust.