Medigap Plan F Premiums Considerations

Medicare Supplement Plan F is popular and definitely the most comprehensive policy offered under Medigap insurance. The details of this ‘first dollar’ coverage remain the same no matter what state regulates its implementation. However, there are differences in the Medicare Plan F Premiums insurance and two factors that impact the cost.

The Gender Issue
An analysis of Plan F across five states showed a difference in premium payments between men and women. There was also a link to age as the premiums for younger female adults were higher than the male young adults. However, once the focus shifted to premiums paid by 65-year olds, there was a dramatic change in gender-specific payments.

On the average, men in the five states reviewed were paying eight percent higher than women for the same policy and benefits. The actual range of differences in premium costs according to gender is quite large. There are companies which charge the same rate for both genders and there are other insurance providers which charge men up to 20 percent more than women. Specific moderate examples are the six percent men are charged more than women in Florida and the ten percent more in Louisiana.

It is interesting to note the findings reported in the 2009 Medicare Current Beneficiary Survey (MCBS) released by the Centers for Medicare & Medicaid Services. Medicare costs per male policyholder are eight percent more than for a female policyholder of Medigap benefits. The fact that male beneficiaries of Medigap receive more healthcare services might be a rationalization for increased premiums.

The Smoking Factor
The MCBS 2009 Cost and Use File also reported that Medigap insurance policyholders who were smokers cost Medicare 16 percent more than the non-smokers. This significant discrepancy in cost of healthcare services is reflected in the range of Medigap rates charged to smokers and non-smokers. Although there are some Medigap plans that charge the same premium for smokers and non-smokers, the smokers usually have to pay more for the same coverage. There are some premiums that are 50 percent higher for smokers.

The average premium is 12 percent higher for smokers given the same policy and benefits. Two specific examples are the differences of 6 percent in Florida and 14 percent in Louisiana in the non-smokers’ favor. It is easy to conclude that gender and smoking have an impact on the Medigap rates for insurance, particularly Plan F. However, it must be noted that neither factor is as significant as age.

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