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Issue Age Pricing for Medigap Plans
How does Issue Age Pricing work?
Medicare Supplement plans based on issued aged pricing means that the premium is based on the age you are when you buy, or "issued", the Medicare Supplement policy from a private insurance company. Premiums are lower for individuals who purchase at a younger age and like community-rated pricing, premiums will not go up due to your age. However, prices may go up due to other factors, including inflation.
Example of how this type of pricing works
The following example shows how issue age pricing of a Medicare Supplement plans works:
Mr. Han is age 65. He buys a Medicare Supplement policy and pays a $145 monthly premium.
Mrs. Wright is age 72. She buys the same Medigap policy as Mr. Han. Since she is older when she buys it, her monthly premium is $175.
Source: Information from the official government handbook published by the Centers for Medicare and Medicaid Services: Choosing a Medigap Policy 2010
Not all insurance companies price Medicare Supplement Insurance plans based on issued aged pricing so it is important to ask how an insurance company prices its policies before applying.