The standardized Medigap plans means that two people with a plan with the same policy from two different companies will get the exact same level of basic coverage. What may not be the same from person to person is the price the policy pays. If the plans are standardized, does that not mean the price for each Medicare Supplemental plan should be the same or nearly the same for any given company? As it turns out, the prices are not standardized and companies are free to tailor them to market forces and the risk they feel each individual represents.
When Medicare supplement plans were implemented, companies could offer whatever level of coverage they wanted. This created wide gaps in coverage from company to company. Congress decided to improve this situation by coming up with a Standardized Medigap plan solution. A standardized Medigap plan is coverage that the federal government allows insurance companies to sell to Medicare recipients. The government cannot dictate what the companies can charge, although premiums that are two high may cost the company customers in the long run. Free market forces still reign in the Medigap coverage market.
There are several items a person must consider when picking out a Standardized Medigap plan. Assuming he has shopped around and gotten quotes from various companies, he then should consider the type of premium plan he chose. People within the earliest age ranges should consider an issue-age rated premium structure. Older people should consider a level premium policy. Only under the most extreme circumstance would a person over the age of 75 want to consider an age-rated policy. He should also look at the plans carefully – some plans differ by vary little but have a wide difference in price.