Why has my Medicare Supplement gotten so expensive?!

Spring brings many things – warmer weather, bird song, thunderstorms and for many on Medicare it means facing an annual rate increase for their Medicare Supplement premiums. There are many reasons why Medicare Supplements are increasing between 15-30% this year.

The Covid effect. During Covid, there were many elective procedures that were put on hold. When these procedures were finally performed, they were often more extensive and expensive.
Baby Boomers. This year marks the end of Baby Boomers entering Medicare; therefore, there is the largest demographic ever on Medicare.

The Medicare Advantage effect. In the past 10-15 years, commissions for signing folks up for Advantage plans have been much higher than those for Medicare Supplements. This caused certain agents to not even present the option of getting a Supplement to enrollees or only enrolling those with considerable health problems on Medicare Supplements. This has created a smaller and less healthy group of enrollees with Medicare Supplements, which also creates greater rate increases.

Claim stacking. Because coverage is so good with Supplements, some providers will “stack” as many claims as possible during a hospital stay or procedure. Because members do not pay extra for these charges, they rarely review or question them.

These factors, however, do not diminish the great benefits a Medicare Supplement offers such as low risk of medical expense, no networks, nationwide access to providers and the rare need of pre-authorization for medical procedures. For healthier individuals with Medicare Supplements, the opportunity to shop for better rates can be done at any time of the year. There are other Supplement plans that may offer fewer benefits for lower premiums that may be attractive options before considering an Advantage plan.

For individuals facing rate increases that are no longer financially sustainable and who are unable to pass medical underwriting to get a less expensive Supplement, it may be necessary to consider switching to a Medicare Advantage plan in the fall during the Annual Enrollment Period, October 15th – December 7th.

If you or someone you know is facing these rate increases this spring and in need of help to navigate or update their Medicare choices, contact the licensed insurance agents at On Point Insurance Agency – we are ready to help!