Here is something most people do not know. A Plan G from Mutual of Omaha and a Plan G from Aetna cover the exact same things. Same hospital stays. Same doctor visits. Same skilled nursing. Federal law makes them identical. So if the benefits are the same, what makes one carrier better than another?
All Medigap plans are federally standardized
Medicare Supplement plans (Medigap) are sold by private insurance companies, but the benefits are set by the federal government. Every Plan G is the same. Every Plan N is the same. The letter you pick decides what is covered. The carrier you pick decides what you pay and how you are treated.
This is unique among insurance products. Most other types of insurance vary by carrier in what they cover. Medigap does not.
What really differs between carriers
1. Price
The same Plan G can cost $90 a month from one carrier and $200 a month from another, in the same zip code, for the same person. That is a $1,320 difference per year for the exact same coverage.
Why? Each carrier prices its plans based on its own claims history, marketing costs, broker commissions, and target customer. Some carriers price low to grab market share. Others price high because they spend more on advertising or pay agents bigger commissions.
This is the single biggest reason to shop around. The benefits are the same. The price is not.
2. Pricing methodology
This part trips people up. Medigap carriers use three different ways to set premiums:
- Issue-age: Your premium is based on the age you were when you bought the policy. The rate does not go up just because you get older. It can still go up due to inflation.
- Attained-age: Your premium is based on your current age. The rate goes up every year as you get older, plus inflation.
- Community-rated (no-age-rated): Everyone in your area pays the same rate, regardless of age. The rate can go up due to inflation but not aging.
Attained-age policies usually have the lowest starting premium and the steepest rate increases. Issue-age and community-rated policies usually start higher but go up more slowly. Over 20 or 30 years, the difference can be thousands of dollars.
3. Rate increase history
Carriers raise premiums every year or two. Some carriers have a history of small, steady increases. Others have a history of big jumps. There is no public database, but a good independent agent can tell you how a carrier has acted with its other customers over the last 5 to 10 years.
This matters a lot for plans like Plan F, where the pool of customers is getting older and the rates are usually climbing faster than other plans.
4. Financial strength
You want to buy from a company that will be around to pay claims. Most Medigap carriers have a rating from one of the big agencies, the most common being A.M. Best. Look for an A- or better rating. The state guaranty association also backs Medigap policies, but the limits vary by state, and you do not want to rely on that as your main protection.
5. Discounts
Many carriers offer discounts you may not know about:
- Household discount: Many carriers give 5% to 12% off if you and your spouse both have a policy with them, or if you live with another adult Medicare member (in some states)
- Healthy lifestyle discount: A few carriers offer a small discount for non-smokers
- Annual payment discount: Paying once a year instead of monthly can save a small amount
- Electronic funds transfer discount: Letting them auto-debit your bank account often saves a small amount
6. Customer service
Claims usually run automatically through Medicare crossover, so you should rarely have to deal with the carrier directly. But when you do, you want a carrier that picks up the phone, processes claims fast, and does not surprise you with paperwork. Online reviews and independent agent feedback can help here.
The big national Medigap carriers
Most Medigap policies in the country are written by these companies:
- UnitedHealthcare (AARP-branded): Huge market share, community-rated pricing in most states, household discount available
- Mutual of Omaha: Big in the Plan G and Plan N space, household discount, generally stable rates
- Aetna: Now part of CVS Health, several Medigap entities, competitive pricing in many markets
- Cigna: Strong in some southern states, attained-age pricing in most areas
- Humana: More known for Medicare Advantage but also writes Medigap
- Anthem and Blue Cross Blue Shield: Many regional BCBS plans are strong in their home states
- State Farm: Available in some states, often competitive Plan G pricing
The "best" carrier really depends on your state, your age, and what plan letter you want. The cheapest Plan G in Florida is rarely the cheapest Plan G in Ohio.
How to compare without getting hounded
If you enter your phone number on a "compare Medicare plans" website, you will get phone calls from a dozen call centers within an hour. Many of those calls come from offshore boiler rooms that do not actually sell insurance, just collect leads and sell them to others.
A cleaner way to compare:
- Get quotes from an independent agent who works with multiple carriers
- Use Medicare.gov's plan finder for ballpark prices (they have a Medigap tool, though it is less detailed than Medicare Advantage)
- Ask the carrier directly if you have one in mind
An independent agent costs you nothing extra. The agent is paid by the carrier you pick, not by you, and the rate is the same whether you buy through the agent or directly from the carrier.
What to ask before you buy
- What is the monthly premium for my exact age and zip code?
- Is this issue-age, attained-age, or community-rated pricing?
- What is the rate increase history for this plan in this state over the last 5 years?
- What discounts can I get?
- What is the carrier's A.M. Best rating?
- How do I file a claim if something does not go through Medicare crossover automatically?
The bottom line
If you are picking a Medicare Supplement plan, do not assume that a big name carrier is the best choice. The benefits are identical across carriers. The price is not. The smart move is to get three quotes for the exact plan letter you want and pick the one with the best price, the best rate history, and a solid financial rating. That is a 20 minute exercise that can save you several thousand dollars over the next 10 years.