Quotes Accuracy with Premiums

[Wu8jmsM]

I have a quick question that I can't get answered by anyone, anywhere; not even with Mutual of Omaha itself. I think it is a simple question that should be able to be answered but so far, no one has been able to explain it to me. Maybe I'm not explaining myself clearly enough. I hate to give out private information publicly but without a little bit of information, no one is going to be able to help. 75 year old Male currently signed up under plan F since 2010 with Mutual of Omaha. Paying $312 a month in premiums, raises every year on my birthday. Household discount is applied.

I'm using CSG Actuarial's quote tool, put in all the information above necessary and I am getting the below quote for the exact same plan I already have. Why am I paying nearly double the premiums? Can someone explain this to me? How can any quotes from any plans by any insurance company be trusted if they don't show what someone already enrolled in that exact plan is paying? Are these the newcomers prices? Do they jack all the premiums up after you enroll? Is this because I was stuck in this plan since 2010 and they changed something but it doesn't effect me because of whatever reason they want/can come up with? Please help me with any information you can, I would greatly appreciate it.

Feel free to run this quote for yourself.



Edit: I forgot to include Illinois, 62702. Here is a screenshot from Illinois SHIP PDF (a year behind) as well as a screenshot from Mutual of Omaha's quote engine on their website below (matches CSG Actuarial).

 

[MBSC]

Mutual of Omaha has a bad habit of "closing the book" on a plan and opening a "new book". The "book" is also referred to as a "pool" of enrollees. Once the book/pool closes, there are no young, healthy enrollees joining to keep rates low.

The new enrollees are assigned to the new book/pool for that plan letter. Their rates are lower because the pool is healthier. These are the rates you are seeing.

If you are healthy enough to pass medical underwriting, you can be moved to the new, lower priced pool or to another company with lower rates. Some states (CA, CT, MO, NY, OR, WA) have special rules allowing you to switch Medigap plans without underwriting. Let me know if I can be of further assistance.

 

[Wu8jmsM]

Wow, thank you. So within the same Plan F they have multiple 'pools' or 'books' where they charge different rates. I knew I was missing out on something by not having a broker looking into things for me every year. I was going to stay with Mutual of Omaha but I don't know now, that sounds like playing dirty to me. It's no wonder no one from Mutual of Omaha would answer me.

How many other companies do this kind of thing? It's just so hard to pick a company you might be stuck with for the rest of your life. None of them really inspire trust to me.

Thank you again for helping me when so many others would not. I appreciate it very much.

 

[MBSC]

If you buy the plan from the parent company (BCBS, Humana, UHC), they use one pool per plan letter. If you have to buy the plan from a subsidiary like Loyal American Life (Cigna), they are either using multiple pools or intend to establish them in the state. Smaller companies like Thrivent don't have enough members to do this.

I did find the following in case you are not healthy enough to change plans. BCBS-IL supplements apparently are guaranteed issue. It may not be the lowest rate, but should be lower than what you are currently paying. You may also want to consider moving to Plan G. The premium savings is usually greater than the Part B deductible.

Determine Your Client’s Eligibility

- Age 65 or Older
- As long as your client is an Illinois resident age 65 or older and has Medicare Parts A and B, their acceptance is guaranteed.

Reference: https://www.bcbsil.com/producer/medsup.htm

 

[Wu8jmsM]

Thank you for the extra help you have provided, it's being put to good use.

I know I was dumb when we first signed up for plan F, we didn't put any thought into it and let the agent do all the work. I've been unhappy with it for some time. I've recently started educating myself on all things medigap and am hoping we pass underwriting (we may not in the future) so whatever company / plan we choose know may be our last for life so it requires great forethought.

I should have switched into plan G back in 2015 but I wasn't informed because our agent never came around or called. I didn't know about brokers. So now I'm not sure plan G is the best bet because everyone is going to be grandfathered into it now. Plan D is a good choice as long as you don't have to worry about excess charges. I checked all our doctors and they all take medicare assignment. That doesn't mean we won't find ourselves with a different doctor in the future who doesn't. That's something to consider. I thought about plan N for a while. I should have been on this plan from the start as I almost never went to the doctor. My wife probably should have been on D or G. I went through the medical records on medicare.gov and wrote down all the office visit codes and came to the conclusion that plan N is not a good choice now. If it were easy to switch plans then I would consider it but I'm approaching this decision from the standpoint that I won't have that option again and this is our last switch. I still plan on checking the plans from time to time and will switch again if I think it is in our best interest to do so and we are still in good health.

I know that it's a good idea to look for a loss ratio under 80% as that will keep their premiums lower.

I know it's a good idea to look for an increase history in the single digits. I don't completely understand the negative numbers here. Looks like it fluctuates a lot.

What I really want to focus on more than the premium is the company. I want a good reliable company. I haven't been dissatisfied with Mutual of Omaha, I've been well taken care of in terms of claims. I am afraid of picking a bad company and not being able to transfer out. Some companies have a rating, some don't. I don't know that it shows much. Some companies have almost no website or members area. I like being able to look up claims at Mutual of Omaha. A larger company is going to have that over a smaller one. Blue Cross Blue Shield, State Farm, Aetna and Humana are probably some that also do. If you have any good advice on picking a company, I would love to hear it. This is the part I need help with the most.


I've also looked into High Deductible plan G. We would be responsible for $2340 plus the yearly deductible which is around $600 minimum. This comes out to more than most other yearly plan G premiums so I don't know that anything is saved here. I don't think the HD plans are a good fit in our state.

Thank you again for your help, you have been most kind. I just wish I would have looked into this from the start.

 

[Wu8jmsM]

Here is a good company in financial standing with good premiums but they have been in the 90% in terms of loss since 2018. 79% in our state seems to be improving. But how do I know what the future holds for this company?

 

[MBSC]

I agree this should be treated as the last time you may be able to change plans but no one ever finds the perfect Medigap plan.

1) You seem to be confusing carrier bankruptcy with carriers pulling out of a market area. Financial strength and loss ratios have nothing to do with carriers deciding to leave a particular state. Bankruptcy is not an issue. Companies with a small market share are more likely to leave a state so pick one with a larger state market share if this concerns you. Plan D has a small market share and therefore is more likely to be dropped by a carrier.

2) Claim processing and customer service is about the same across all Medigap carriers. Since you want to be able to see claim history, this should be the deciding factor but I cannot help with this aspect.

3) Plan G rate increase history is no longer useful. Prior to 2020, unhealthy people aging in to Medicare chose the most comprehensive Medigap plan available (Plan F). This insulated Plan G from higher rate increases. Today, the most comprehensive plan available to unhealthy people aging in to Medicare is Plan G. So, future rate increases are expected to be higher than, and unrelated to, prior rate changes. They should still be less than Plan F.

4) Enrollment in the Oxford Plan G dropped from 800 to 500. From my viewpoint, executive management has set the premium artificially low to increase enrollment. I would expect the premium to increase dramatically once the enrollment goal is met.

The "loss leader" premium is reflected in the high Loss Ratio. The premium barely covers claim costs. In 2019, it appears they tried to set the premium high enough to cover administrative costs. This caused the state Loss Ratio to be in the normal 80/20 range but cost them 300 of their 800 enrollees.

 

[Wu8jmsM]

That's interesting. Sorry to keep picking your brain on this but I can't get any brokers in the area to get back in touch with me. Is there a list somewhere with brokers in my area by zipcode? I've been finding them on facebook but am not impressed.

I see many plans with no market data available. Some have only been in business for a year or even less. Some have maybe 4 people in the entire state in the plan which probably isn't a good option. I knew about plan G becoming the default and would likely increase premiums. All the prices from plans D and N were non competitive against G, so I settled on G. Who knows what is in store for G's future and how it will compete with the other plans but it seems no one can know this until the next year or two rolls around.

Here are some plans I have selected, can you tell me what your opinion would be? I've included both 2018 and 2019 market data where available. They all seem to have login panels, incidentally some of them link to Aetna's login portal.

https://imgur.com/a/u0E9iuk

Here is a quote from Physicians Mutual that claims you can choose either Issue Age or Attained Age, which I haven't seen anywhere else. I don't
know the best option on that front as I didn't think it was possible in Illinois to choose another type other than Attained Age.



Thanks again, you keep leaving me with more to think about each time.

 

[MBSC]

I like Aetna ($1588), Humana ($1625) and the issue-age version of Physician's Mutual Plan G ($160.53/mo).

The issue-age plan will have an annual rate change for inflation and the health status of the enrollment pool but not for age. The age increases are baked into the initial premium. So, the starting premium is higher but the increases going forward are lower. It all balances out in the end. $160 is a good issue-age rate for age 75.

I'm only familiar with the national brokers like Boomer Benefits, Senior Savings Network, Senior65, etc.

 

[Wu8jmsM]

Physician's Mutual has some very interesting plan choices. Their innovative plan is similar to a high deductible but it only lasts 3 years. Looking at our medical records this wouldn't make sense for us though but some may find it great.



I am looking very closely at Physicians Mutual from a company perspective. Their claims payout and customer satisfaction seem to be pretty high.

Aetna's website says this state is not yet available when you try to get a quote. So I don't know how you sign up for it.