You Can Save Hundreds on Your Medicare Supplement Plan Premium by Shopping Around, But Your Timing Is Key
Your Medigap plan could be significantly cheaper with another carrier. It's easier than you might think to switch — but beware of the timing trap that can trip you up.
Most people treat their Medicare supplement plan the way they treat a landline: It's something they sign up for once, at 65, and never think about again.
That instinct might make sense for other types of insurance. But it's the wrong instinct when it comes to your supplement plan, and it can cost you hundreds of dollars a year, sometimes for a decade or more, without you noticing.
The part nobody expects: Identical coverage, different price
Here's what most people don't know about Medicare supplement, or Medigap, plans: They're standardized by the federal government. A Plan G from one insurance company covers exactly the same things as a Plan G from every other insurance company selling in your state. Same benefits, same rules, no exceptions.
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The only thing that changes from carrier to carrier is the premium, and that gap is often much bigger than people expect. It's common to see one company quoting around $140 a month for a Plan G in a given ZIP code, while another quotes $240 for identical coverage.
If you live in Massachusetts, Minnesota or Wisconsin, your state uses its own Medigap plan structure instead of the lettered system, but the same principle applies: Compare identical coverage across carriers.
That difference isn't a mistake in the system. It's simply how a heavily regulated product still leaves room for companies to compete on price. Once you understand that the benefits can't differ, price becomes the only variable worth comparing.
If it helps to see the price comparison laid out visually, this video walks through a similar rate check, including how identical Plan G quotes can vary by $100 or more depending on the carrier.
Why the same plan gets more expensive every year you ignore it
Insurance companies tend to price Medigap plans competitively when they're trying to attract new customers, then raise those rates gradually in years two, three and four.
Meanwhile, a different, equally reputable company may be offering the exact coverage you already have at close to what you originally paid. The result is a slow drift where loyal customers end up paying the most for the same benefits, simply by not looking elsewhere.
Consider this scenario based on real-life patterns I often see in my practice: Carol enrolled in a Plan G at 65 for $150 a month and never revisited it. Eight years later, she was paying $310 a month for the same coverage, on the same plan letter, that a different company was now selling to new customers for $165.
Nothing about her benefits had changed. What had changed was the price she was willing to keep paying without checking.
The catch: You need to shop while you're still healthy
Here's the part that makes this more than a simple money-saving tip. When you first become eligible for Medicare, you get a six-month Medigap open enrollment window where you can buy any plan, from any company, regardless of your health.
Once that window closes, switching companies generally means answering health questions. Depending on your answers, you can be charged more or declined altogether.
Several states (including New York, Connecticut, Massachusetts and others with "birthday rule" laws) require little or no underwriting to switch, but check with your State Health Insurance Assistance Program (SHIP) to see your state's specific rules before assuming this applies to you.
That's the trap in Carol's story. The money was there to be saved every year she waited, but the ability to make the switch wasn't guaranteed to still be there when she finally looked. The right time to compare pricing isn't when you're sick and need to. It's now, while you still qualify for whichever plan turns out to be the better deal.
The piece that isn't standardized: Part D
If you go the Medicare supplement route, prescription drug coverage isn't included. You'll need a separate Part D plan, and unlike Medigap, these plans aren't standardized.
Premiums, deductibles and which medications are covered can vary significantly and can change from one year to the next, even if you don't change anything yourself. This is worth reviewing every single year, not every few years, during the annual enrollment window that runs from October 15 through December 7.
Even people who aren't currently taking any medications are better off enrolling in a Part D plan rather than skipping it. Going without one, if you don't have other qualifying drug coverage, can trigger a penalty that gets added to your premium for as long as you're on Medicare.
What to do this fall
You don't need to wait until something feels wrong with your current plan to check whether it's still the right price.
Pull your current Medigap premium and compare it against current rates for the same lettered plan from other carriers licensed in your state, not just your existing company.
Do this while you're healthy. If your health has changed since you last shopped, ask an independent agent what your options are before assuming you can switch freely.
Mark October 15 through December 7 on your calendar every year, and use that window to review your Part D or Medicare Advantage plan, even if last year's plan still feels fine.
The takeaway
Medicare isn't a decision you make once at 65 and close the book on. Your health changes, insurance pricing changes, and the marketplace shifts every year whether you're paying attention or not.
Reviewing your coverage every two to four years, and your Part D plan every single year, can mean meaningful savings without giving up a single benefit. The only real risk is waiting too long to look.
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- The '100% Overwhelming' Decision: What Do You Do About Medigap?
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- Watch Out for the ‘Medigap Trap’
- 11 Costly Medicare Mistakes You Should Avoid Making
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