Arrow-right Camera
The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Plenty Of Gap In Medigap Premiums

From Staff And Wire Reports

It pays to shop around - or move around - for health insurance to cover the gaps in Medicare, according to a survey released this week.

Florida seniors pay for their place in the sun with the highest cost in the nation for so-called “Medigap” insurance, while Utah residents spend the least, the study by independent insurance evaluator Weiss Ratings Inc. found.

Rates in Washington range from as little as 1 percent more than the low for one plan to more than double the low for another.

Rates in Idaho are generally higher.

There are 10 plans altogether, each offering different levels of coverage. Provisions are identical from company to company.

Medigap policies, bought privately by about 78 percent of Medicare beneficiaries or their former employers, supplement Medicare benefits and pays co-payments and deductibles.

Insurers say they charge more in states with large numbers of people on Medicare because they have to pay out more claims.

The gulf in plan prices can be vast.

Floridians shelled out the nation’s highest rates, at $1,812 a year for a no-frills plan at American Republic Insurance Co. That’s more than seven times what Anthem Life Insurance Co. subscribers in Texas paid, at $242.

Medical Service Corp. of Eastern Washington offered the cheapest no-frills plan in the state, at $336.

Florida seniors who bought the most comprehensive plan from American Pioneer Life Insurance Co. paid $3,985 annually - three times the $1,126 South Dakotans pay South Dakota Medical Service Inc. for the Cadillac plan.

The same plan was only $13 more in Washington than in South Dakota, closer to the low than any other plan sold in the state.

The gap between the best rate in Washington and the best nationally on Plan F, the most popular option, is also relatively narrow.

The $756 charged by Blue Cross of Washington and Alaska is only 12 percent higher than the $676 charged in South Dakota.

The same company often offers dramatically different prices from one state to another. Pioneer Life Insurance customers in Delaware, for example, pay the least in the nation for Plan D, at $402, and the most for the identical plan in Florida, at $1,971.

The company offered six of the ten most expensive plans on the Weiss list.

“The bottom line is it’s hard to establish what company is most expensive or least expensive nationwide,” Weiss Ratings founder Martin Weiss said. “One thing we can say for sure is you really have to shop, because the price variation between one company and another company with the same plan in the same state can be huge.”

The survey, based on 6,118 price quotes by 153 insurers in 50 states and the District of Columbia, compared costs for a 65-year-old male as of last month. Medigap insurers must cover anyone who applies within six months of becoming eligible for Medicare.

Rate information provided by the Washington Insurance Commissioner’s Office differed from that produced by Weiss.

In some cases, the cheapest carriers were not the same, for others the rates were not identical.

Melissa Gannon, a Weiss vice president, said a decision to omit companies with less than $10 million in premiums in a state may account for some of the discrepancies.

The news comes as seniors battle a proposal by President Clinton to raise Medicare costs for elderly couples with annual incomes over $75,000.

The American Association of Retired Persons in particular has been aggressive in criticizing higher costs, saying seniors have been increasingly burdened in recent years. Medigap premiums rose by an average of 13 percent this year, following a 27 percent jump in 1996. , DataTimes MEMO: This sidebar appeared with the story: BEST RATES The least expensive Medigap plans in Washington, as complied by Weiss Ratings Inc. A list compiled by the Washington Insurance Commissioner’s Office varies slightly. Plan A offers the least coverage, Plan J the most comprehensive coverage. Plan A: MSC of Eastern Washington $336. Plan B: MSC of Eastern Washington $528. Plan C: MSC of Eastern Washington $648. Plan D: USAA Life Ins. Co. $694. Plan E: Kitsap Physicians Service $630. Plan F: Blue Cross of Wash. and Alaska $756. Plan G: USAA Life Insurance Co. $802. Plan H: National States Insurance Co. $1,750. Plan I: Blue Cross of Wash. and Alaska $936. Plan J: Blue Cross of Wash. and Alaska $1,138.

This sidebar appeared with the story: BEST RATES The least expensive Medigap plans in Washington, as complied by Weiss Ratings Inc. A list compiled by the Washington Insurance Commissioner’s Office varies slightly. Plan A offers the least coverage, Plan J the most comprehensive coverage. Plan A: MSC of Eastern Washington $336. Plan B: MSC of Eastern Washington $528. Plan C: MSC of Eastern Washington $648. Plan D: USAA Life Ins. Co. $694. Plan E: Kitsap Physicians Service $630. Plan F: Blue Cross of Wash. and Alaska $756. Plan G: USAA Life Insurance Co. $802. Plan H: National States Insurance Co. $1,750. Plan I: Blue Cross of Wash. and Alaska $936. Plan J: Blue Cross of Wash. and Alaska $1,138.