AARP Medicare Supplement Plan G

[bitiya]

 My wife and I signed up for AARP United Health Care Medicare Supplement plan G in 2020. During the first year our premiums were from January thru December. However, starting from 2021 our premiums increased twice a year from January thru May and again June thru December. I was informed when we signed up that my premiums will change on the month of my birth. My question is, do the premiums increase twice a year? We live in Michigan. Some of my friends with the same plan thru AARP UHC tell me that they are billed once a year. I will appreciate if someone can let me know if this is mistake that we are billed twice a year. I have tried to call their  customer service several times to no avail as I haven’t received a satisfactory explanation. I sent a certified letter to them four months ago and have't heard from them. TIA..

[CBtoo]

AARP increases all plan premiums on June 1 based in inflation, costs, etc. They also increase your premium each year as you get less discount as you get older - either your birth month if you signed up for it to start then or the month you signed up for it to be effective for if you signed up a couple of months later until there are no more discounts left and then you only have your premium increased once a year in June (for example my birthday is in Oct, I signed up in Dec for a Jan start. My increases are for Jan - decreasing age discount and in June - the across the board increase). IF your birthday/when you signed up is in June then you both your increases (annual and reduced discount) hit in the same month so you only get a once a year increase anyway. 

[TRL1111]

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@CBtoo wrote:

AARP increases all plan premiums on June 1 based in inflation, costs, etc. 

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My across-the-board increase happens in July, not June.

[CBtoo]

Well it may depend on the state which month. 

[GailL1]

@bitiya 

It may depend on the type of policy you have - read your Explanation of Coverage that you have on your Medigap plan.

So when medical inflation is a factor, which has been for several years - especially since the PHE (Public Health Emergency aka covid) - you will get an increase that has been based on inflation - meaning a usage spike or higher prices for things medical. Then add in new treatments usually also higher in price - This goes for every Medigap insurer not just UHC.

Another thing that will increase the loss ration is when specific states allow for looser rules for when people can change or in some states, purchase, a medigap plans WITHOUT UNDERWRITING.  Like those in the state who are older, perhaps sicker, who are able to switch plans at some time during the year (4 - 5 states have continuous enrollment) - This would be state specific as to whatever premium increase would come from this type of state legislation. 

Another thing that will also increase the loss ration is a state opening up their Medigap marketplace more freely to those who get Medicare as a result of a disability (under 65).  Again, because they may require more care cost - it adds to the cost to the Medigap insurers.  Federal law does not give any Medigap benefits to those under 65 years old but states definitely can and do. 

Now normally this type of premium increase is only once per year - but it can be more often.  All Medigap insurers have to apply for a premium increase rate review with their state and get approval.  I assume that it is this way in Michigan also.  It is possible that they have a medical loss ratio that needs a large correction.  But again, your state would be the best to know when and how much - as guided by medical loss ratio reports by the NAIC (National Assoc. of Insurance Commissioners)

Michigan.gov - Dept of Insurance - Medicare Supplemental Policies 

The entities that have some affect on Medigap plans;

Now, UHC also has a type of policy that has an enrollment declining discount.  You will have to look at your particular policy to see the details but many of the newer ones give an enrollment discount at the beginning of the policy period and then it stay constant for about 3 years and then the discount declines and your premium goes up because of this and I believe every year after that until age 81 or so and then it is gone.  

Here is a sample page from one of their policies to show you how the enrollment discount works 

Now this - the enrollment declining discount - maybe the increase that is shown around your birthday or thereabouts.