Almost every day I receive a request from someone who is about to go on Medicare to provide them with Medicare Supplement quotes for their area.
While I am happy to do this, I always feel the quotes I am providing to them are misleading.
The reason for this is there is virtually no relationship between the monthly premium you pay for a Medicare Supplement at age 65 compared to other carriers and what you will pay over the course of your lifetime.
In many situations, the Medicare Supplement carrier with the lowest premium at age 65 will cost much more than other carriers both in the near future and the rest of your life.
Many Medicare Supplement carriers have a business strategy of enticing enrollees with artificially low premiums at age 65. Later, when many policyholders can not change their carrier due to health reasons, these carriers increase their prices to higher levels than other carriers.
The reason they do this because once someone has been on Medicare Part B longer than six months, they must disclose any health conditions they have to enroll in a new Medicare Supplement. Medicare Supplement carriers at that time can and will decline applicants who have existing health conditions that are likely to present the carrier with above-average costs.
There is one rule you should follow when choosing a carrier for your Medicare Supplement: Choose the carrier not the price!
Here are some qualities to seek in choosing a Medicare Supplement carrier:
1) Choose a carrier who has been providing Medicare Supplements for at least 10 years. Any carrier who has been in business shorter than this amount of time is likely to have a policyholder base weighted toward people who are new to Medicare and who will have sharp increases in health care costs as they get older. In this case the carrier will have to sharply increase their premiums to pay to higher claims cost.
2) Choose a carrier who allows independent agents who also represent other carriers to represent them. Carriers whose business strategy is to entice people new to Medicare with artificially low first-year premiums only to increase them later do not want agents who can offer other products. Agents want to avoid the dissatisfaction these carriers generate 4 or 5 years later when the premiums skyrocket. Agents will therefore recommend other carriers.
3) Choose a carrier whose name is familiar. A carrier whose name is unfamiliar is more likely to be trying to generate many enrollments with artificially low premiums and then sharply increase the premiums for the people it has trapped. Such a carrier may then change its name to confuse potential enrollees and not be associated with its price hikes on existing customers.
4) Choose a carrier with at least 500,000 Medicare Supplements policyholders. Such a carrier has proven it plans to offer Medicare Supplements on a permanent basis and it not relying on short-term pricing gimmicks to generate exorbitant profits at the expense of its policyholders.
I would appreciate the chance to help you understand your Medicare options so you can choose the right Medicare plan for you both now and in the future.
Simply click the following link to schedule a free, no-obligation 30-minute Medicare consultation.
I look forward to talking with you soon.
Charles Bradshaw is President and Founder of MedicareAnswerCenter.com.