Two Mistakes People Make When Choosing a Medicare Supplement—and How to Avoid Them

Choosing a Medicare Supplement (Medigap) plan is one of the most important decisions you’ll make as you enter retirement. These plans help cover costs that Original Medicare doesn’t, such as copayments, coinsurance, and deductibles. They offer peace of mind when it comes to managing healthcare expenses.

But too many people unknowingly fall into the same traps when choosing a policy. Let’s look at two of the most common mistakes and how you can avoid them.

Mistake #1: Focusing Only on Premium Instead of Long-Term Rate Stability

Everyone loves a good deal, but with Medigap, cheaper isn’t always better. It’s easy to compare premiums and choose the lowest cost option, but a company offering a low premium today might not be offering you the best long-term value. Some insurance carriers have a history of steep rate increases year after year, often catching policyholders off guard.

According to the Kaiser Family Foundation, over 14 million people were enrolled in a Medigap plan in 2022, and nearly all of them experienced some form of premium increase over time. Rate hikes can be based on age, inflation, claim history, or company pricing models.

How to avoid it:

When comparing plans, ask your agent to show you the company’s rate increase history over the past 5–10 years. This gives you insight into future costs, not just the current rate.

Mistake #2: Not Considering Household Discounts

Many insurance companies offer household discounts if you and your spouse (or another adult living in the same home) both apply for a policy, even if only one of you is eligible for Medicare. These discounts typically range from 5% to 12%, which adds up over time.

A 2023 AHIP report found that 26% of Medigap policyholders receive a household discount, yet many more are eligible and simply don’t know to ask.

How to avoid it:

Be sure to tell your agent if you live with a spouse or another adult. Ask which carriers offer household discounts in your state and compare the discounted rates, not just the base premiums.

Bonus Mistake: Choosing a Company with a Poor Rate Increase History

Not all Medigap providers are created equal. Some are newer to the market or have unpredictable pricing strategies, which can lead to unexpected spikes in your premium. Others have built a reputation for stability and transparency, which can save you thousands over your lifetime.

How to avoid it:

Work with a knowledgeable agent who is independent and represents multiple carriers. They can provide objective data on rate trends, customer satisfaction, and policy longevity.

Final Thought

Your Medigap plan is more than a monthly payment; it’s a long-term investment in your health and financial security. Take the time to look beyond the price tag. By avoiding these common mistakes, you can choose a plan that’s affordable now and sustainable for years to come.

Need assistance navigating the options? We’re happy to help you compare plans, rates, and discounts based on your unique situation.