Every year many of our clients are informed of rate increases to their Medicare Supplement plans. For some, the increase can be rather significant, while others may see an increase of only a few dollars. Insurance is about pooling premiums from many people in order to protect individuals within the group from the full burden of healthcare costs. Here are some factors that influence your rates each year.
Most Medicare supplement plans calculate premium costs based on your current age. Typically, the older you get, the more care you will need, thereby increasing the number of claims that you, or others within your insurance pool will make. For some insurance companies the largest premium increases occur when you jump to a different age bracket, while other companies increase their premiums according to your age every year.
Medical inflation costs
Insurance carriers also determine your insurance rates according to increases within the healthcare market. For example, physician costs, lab costs, the increased usage of newer and more expensive technology.
Because your premium is pooled with other insurance holders’ premiums, insurance companies will look at the number of claims filed in a given year by the entire pool. If the number of claims is high, then the cost to the insurance company increases.
Making an Affordable Change
If you would like to discuss your rate increase and any options you might have, we are here for you. Please give us a call.