You’re going to turn 65 soon and you are looking at all your health insurance options. Do you take out a Medicare Advantage plan or do you go with Original Medicare and pick up a Medicare supplement insurance (also known as Medigap) plan?
The choice you make now is an important one, says Alan Weinstock, insurance broker at http://www.MedicareSupplementPlans.com, because there will be some key questions that you will want to ask your insurance broker if you choose Medicare with a Medigap plan.
To help you out here are five questions that he suggests you ask insurance brokers before you purchase a Medicare supplement insurance policy.
Are they licensed in the state?
While Medigap insurance companies can sell you only a standardized Medigap policy, which ones they sell are dictated by what they choose to offer AND state law. All Medigap policies must have specific benefits so you can compare them easily. Insurance companies that sell Medigap policies don’t have to offer every Medigap policy. However, they must offer Medigap Plan A if they offer any other Medigap policy.
Do they use medical underwriting?
Medigap insurance companies are generally allowed to use medical underwriting to decide whether to accept your application and how much to charge you for the Medigap policy unless you apply during the Medigap open enrollment period, even if you have health problems. After this period, there is no guarantee that an insurance company will sell you Medicare supplement insurance at all if you don’t meet the underwriting requirements.
So if the company does use medical underwriting, then ask if there a waiting period for pre-existing conditions. If the answer is yes, you’ll want to know how long.
Is the insurance community-rated, issue-age rated or attained-age rated?
Insurance companies decide how to set their price (called premium) for its Medigap policies. The way they set the premium affects how much you pay now and in the future. Medigap policies can be priced or rated in three ways.
Community-rated (also called no-age-rated) means the same monthly premium is charged to everyone regardless of age. Issue-age-rated means the premium is based on your age when you buy the policy, so the rate is lower for those who buy at a younger age. Finally, attained-age-rated means the premium is based on your current age, so the premium amount goes up as you get older.
Do they offer any discounts or incentives?
Everyone appreciates discounts, right? Medigap insurance providers sometimes offer discounts or incentives for women, for non-smokers, for people who are married, for paying your entire premium annually, or for paying your premiums using electronic funds transfer.
In addition, you may want to consider a Medicare SELECT Medigap plan. These are sold in some states and require you to use hospitals and, in some cases, doctors within its network to be eligible for full insurance benefits (except in an emergency). Plus they generally cost less than other Medigap policies.
Do they charge extra to process claims automatically?
You may want to make sure your carrier has an arrangement with Medicare so that Medigap claims are filed automatically. That can save you time and removes the risk of your failing to file a claim during a period when you’re recovering from illness or injury.
The whole idea is to ask questions about what types of policies are available in order to determine the right one for you. It means taking the time to do a little research and to compare rates, plans and benefits from several prominent insurance companies.