4 Steps to Buying a Medigap Policy
Buying a Medigap policy is an important decision. Shop carefully, and compare available policies to see which one meets your needs. Keep in mind different insurance companies charge different amounts for the same policy, and not all insurance companies offer all of the Medigap policies.
There are four steps to help guide you through buying a Medigap policy:
Step 1: Decide which benefits you want, then decide which of the standardized Medigap policies meet your needs
- When deciding on which benefits you want consider your current and future health care needs. You may not be able to switch policies later. Select the policy that works best for you based on your benefit needs.
Step 2: Find out which insurance companies sell Medigap policies in your state
- Call your State Health Insurance Assistance Program. Ask if they have a “rate comparison guide”. This guide usually lists companies that sell Medigap policies in your state and their costs.
- Call your state insurance department
- Ask if they keep a record of complaints against insurance companies that can be shared with you. When deciding which policy is right for you, consider complaints that have been made.
- Visit Medicare.gov to find a plan
- If you do not have a computer, your local library or senior center may be able to help you find this information. You can also call 1-800-633-4227 (1-800-Medicare) to speak with a customer service representative
- Your local library may have information on an insurance company’s financial strength from independent rating services
Step 3: Call the insurance companies that sell the Medigap policies you are interested in and compare costs
- Before calling insurance companies find out if you are in your Medigap Open Enrollment Period, or if you have a guaranteed issue right.
- Here are some questions you can ask each insurance company:
- “Are you licensed in the state I live in?”
- “Do you sell Medigap Plan __?” (The letter of the plan you are interested in)
- “Do you use medical underwriting for this Medigap policy?”
- “Do you have a waiting period for pre-existing conditions?” Make note of how long the waiting period is
- “Do you price this Medigap policy by using community-rating, issue-age-rating, or attained-age-rating?”
- “I am __ years old. What would my premium be under this policy?”
- “Has the premium for this Medigap policy increased in the last 3 years due to inflation or other reasons?”
- “Do you offer any discounts or additional benefits?”
- Be vigilant of illegal practices.
Step 4: Buy the Medigap policy.
- Once you find a policy that is best for you, apply for it. Read the summary of your policy provided by your insurance company thoroughly. If you have questions be sure to ask them before you buy. Also, remember these points when you buy your policy:
- Filling out your application- the answers you give will determine your eligibility for an Open Enrollment Period or guaranteed issue rights.
- Paying for your policy- you can pay for your policy by check, money order, or blank draft. Some companies may offer electronic funds transfer.
- Starting your policy- Ask for your policy to become effective when you want your coverage to start. Policies usually begin on the first of the month after you apply.
- If you do not get your policy in 30 days, call your insurance company.