What Is the Average Cost of Supplemental Insurance for Medicare?

With all the inflation we’ve seen lately, it’s not surprising that one of the most common questions we get asked is, “How much do Medicare supplement plans in Texas cost?” We understand. Moving from an employer-sponsored health insurance plan into the Medicare program can be daunting, especially when you have no idea what it will cost.

Today, we’re going to answer that question by looking at the average cost of supplemental insurance for Medicare in the state of Texas.

Cost of Medicare Supplements in Texas

“Supplemental” insurance could mean many things, but when people ask about supplemental insurance for Medicare, they’re usually referring to Medicare Supplements, also known as Medigap plans. Medigap plans are secondary insurance policies, with Original Medicare (Parts A and B) being the primary insurance.

Unfortunately, it’s impossible to associate one price tag with all Medicare Supplements. Premiums will vary based on which of the plans you choose, your age, gender, zip code, and tobacco status. In addition, the pricing method used by the insurance company will also dictate the cost.

First, let’s explore the three pricing methods used by insurance carriers.

Attained Age. This is by far the most common method used for Medicare Supplements in Texas. Using this method, the insurance company will assign a premium based on your current or “attained” age. In most cases, your premium will increase the older you get. Other things like inflation and the overall cost of healthcare will also play into the pricing.

Issue Age. As the name implies, carriers who use the issue age pricing method determine your premium based on the age you are when you purchase the policy. Your premium will never go up due to your age, but as with the attained age method, inflation and healthcare costs will cause the premium to increase over time.

Community Rated. Very few companies use the community-rated pricing method. In this method, everyone on the policy pays the same price. No individual factors like age or gender are considered. Yet again, inflation and the cost of healthcare could cause the premium to go up.

Next, we need to take a closer look at which Medicare Supplement plan you’d like to purchase. There are about ten plans available, and we’ll look at the three most popular Medigap plans in Texas.

Plan F. Plan F is only available to Medicare beneficiaries who were enrolled in Parts A and B prior to January 2020. This plan picks up every remaining cost that Medicare leaves behind, assuming the services were approved by Medicare. For this reason, it costs more than the other Medigap plans. The average cost of Plan F in Texas for a 68-year-old female is between $150 and $200 per month.

Plan G. Plan G does not have the eligibility limitations of Plan F, and it offers nearly as much coverage. The only thing not covered by Plan G is the Part B deductible. The average cost of Plan G in Texas for a 68-year-old female is between $110 and $160.

Plan N. Plan N is similar to Plan G but also includes copays when you visit your doctor or a hospital emergency room. It also does not cover any Part B excess charges. The average cost of Plan N in Texas for a 68-year-old female is between $85 and $120.

We mentioned earlier that individual factors are used to calculate your premiums. These are the general rules:

  • Older folks pay more than younger ones
  • Men pay more than women
  • Zip codes with higher costs of living have higher premiums
  • Tobacco users pay more than non-users

When shopping for a Medicare Supplement plan in Texas, you should also consider carriers offering discounts. Many will give varying discounts to married couples who enroll in the same plan.

Other Supplemental Insurance to Consider

If you decide to enroll in a Medicare Supplement plan, it’s important to consider the other “supplemental” policies you will need.

At a minimum, you’ll need to choose a Medicare Part D prescription drug plan. These cost less than your Medicare Supplement plan but will largely depend on what prescriptions you take. The more medications you have (and the more expensive they are), the higher your Part D premium. In 2022, the average cost of a Part D plan in Texas was $52.

You should also consider adding a Dental, Vision, and Hearing (DVH) plan to your portfolio. Medicare does not cover preventive or routine services in those three areas. Unless you’re willing to pay completely out-of-pocket, a DVH plan is an easy way to capture coverage for all three. You can tailor these plans to the amount of coverage you’d like, and they range from $30 to $80 per month.

To get an accurate quote on a Medicare Supplement plan in Texas, call Cover Mile. Our independent insurance agents will compare prices across many carriers, so you know you’re getting a competitive rate.