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UNDERSTANDING ALL OF THE MEDICARE SUPPLEMENT/MEDIGAP PREMIUM INCREASES
- Michael Braden
- Apr 17
- 16 min read
Michael T. Braden April 2, 2026 MEDIGAP PREMIUMS
WHY HAVE THERE BEEN SO MANY PREMIUM INCREASES THE PAST 2-3 YEARS?
If you’ve been enrolled in a Medigap plan for a while, you probably noticed
Premium increases were not just higher, they were noticeably outside the normal range most people had come to expect.
Our goal with this article is to try and bring some clarity and honesty to why Medicare Supplement and Medigap Premiums have been increasing at not just an elevated rate the past few years, but I think we could safely say at an Alarming Rate!
I have been an Independent Medicare Broker and certified Medicare Planner for more than a decade. Prior to 2024, I could confidently say that Medigap rate increases have historically been fairly predictable. In most years, premiums tended to rise somewhere in the 3% to 7% range. It wasn’t ideal, but it was manageable. You could plan on those increases and although not liking it, these increases typically do not break the bank.
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MEDIGAP RATE INCREASES ARE OCCURING NATIONWIDE
Across many states and carriers, beneficiaries began seeing larger-than-normal rate increases, sometimes well into the double digits. For individuals living on a fixed income, these increases don't just stand out, they demand our attention and we need to all have a better grasp of the 5-W's, as it pertains to Medicare Supplement and Medigap premiums. (Who, What, When, Where, Why)
WHO
Medicare Insurance Carriers, Medigap Insurance Companies, Hospital's and All Healthcare Companies have seen a large increase in bills for Doctors and Hospital Services that have been ignored and gone unpaid. The vast majority of these recent trends seem to mirror the large increases in individuals entering the US unlawfully.
Other contributing factors include Loss Ratios, and the under-estimating the true costs of Healthcare with the lingering inflation we have all been experiencing. In researching this, I also found that more Medicare Beneficiaries are using Medicare in the first five years, than at anytime, going back to 1967.
It also raised many questions about whether something had fundamentally changed in the Medicare Supplement/Medigap market. AS of March 1, 2026 nearly 14 million people have a Medicare Supplement Policy in the United States, and of those over 95% own a Plan N, Plan G or Plan F policy. So price increases are being felt far and wide across America.
So the real question is not easy to answer, we will all find out together, whether or not these premium increases were a temporary adjustment, or is it something we need to constantly be planning for moving forward.
WHAT
Over the past 30 Months, the highest Premium Increases for Medigap/Medicare Supplement Plans in Arizona have come from:
MUTUAL OF OMAHA
AARP/UHC
BCBSAZ
HUMANA
AETNA
USAA
PHYSICIANS MUTUAL
This same percentage of increases have been seen across the US. Floridians have seen 15-25% increases, and they were already 50% higher than Arizona for example. Some companies almost seemed to delight in demanding 25-40% premium increase nationwide.
WHEN
We started seeing issues with large double-digit Medigap premiums at the end of 2023, and it has not stopped.
We literally do not know how long this trend will continue, and whether or not it is similar to the housing market collapse of 2008, or something more sinister. Time will tell.
WHERE
Oftentimes we can see price increases simply based on geography, however; in this instance, there is nothing we can point a finger out as being geographically driven.
Even though this article is focused on Medicare Supplement premiums, there has also been a huge change in the Medicare Advantage Market the past two years. Below are just a few things that have also caused alarm with other Seniors who chose Medicare Advantage plans.
Most States Have 30% or Medicare Part D Plans available than there were in 2024.
Medicare Advantage Plan Annual Maximum Out-Of-Pocket expenses have jumped 2-3K the past two years alone.
Many Medicare Advantage Companies Cut 20% of their plans, and removed commissions from their plans.
There are now only a handful of Medicare Part D Drug Plans that pay commissions to Agents.
Insurance Companies have greatly reduced the levels of Dental, Vision, and other Supplemental Benefits, while the cost for Hospital Stays continues to go up year after year.
Companies have increase their insistence that any procedure be submitted for Prior Authorization before it can be performed.
Note: Most Medicare Beneficiaries have no clue that Medicare (CMS) pays each Medicare Advantage Company $12,000 per year, for every person enrolled in a Medicare Advantage plan every year. Yet people want too act like Chicken Little if Medicare ever considers reducing their payments.
WHY
We have already listed a variety of things that impact where companies set their premiums:
Healthcare Costs Increase year after year, Doctors, Nurses, Hospitals and Insurance company's all cry that they are poor and need more money.
Margins on Prescription Medications are shrinking. While demand for expensive drugs is at an all-time high.
People are living longer
However, one item that has grown very quickly, I believe has had a lasting impact, but; none of the so-called experts have not figured it out. That is, the explosion of states with Medicare Birthday Rules. This is great for Beneficiaries and Agents, but it cuts into the profits of Insurance companies who have lost a lot of the control of who they offer policies to. This lessens their profit margins because it increases their risk pool. And they have compensated by increasing premiums across the board.
Inflation, whether it is all real, or partially manufactured as the over-riding excuse for mismanagement. The fact it Inflation has and will continue to be a large factor as it pertains to costs and containing costs for anything and everything. We just need to trust and hope that once there is some sort of normalcy again, then it will also result in lower costs in many areas of the economy.
ITS WHAT MOST PEOPLE NEVER SEE OR HEAR ABOUT THAT HAS THE HIGHEST IMPACT ON TEH COST OF PREMIUMS
Behind the scenes, there’s a level of competition in the Medigap market that most beneficiaries never hear about.
Every day, roughly 11,000 Americans turn 65 and become eligible for Medicare. That steady wave of new enrollees has made the Medicare market one of the fastest-growing segments in health insurance. Naturally, insurance companies want a piece of that growth.
To compete, many carriers use a strategy that looks great on the surface. They enter a market with very aggressive pricing, often coming in lower than established competitors to attract new policyholders quickly. And it works.
Lower premiums get attention. Agents quote those plans more often. Enrollment grows.
But here’s the part most consumers don’t see.
When a company prices aggressively, they’re making assumptions about future claims. If those assumptions are even slightly off, meaning members use more healthcare than expected, the company has to adjust. And the only way to do that is through rate increases.
So what you often get is a cycle:
A carrier enters the market with very competitive rates
Enrollment grows quickly
Claims come in higher than projected
Premiums increase to correct the pricing
This doesn’t happen with every company, every year, but it’s common. This was especially true in 2024, 2025, and so far in 2026.
From a consumer standpoint, it can feel frustrating. A plan that looked like a great deal at enrollment may experience larger adjustments a few years later.
WHAT AGRESSIVE PRICING LOOKS LIKE
You can see this pricing strategy play out when new carriers enter the Medigap market and try to gain traction quickly. In several recent cases, newer or expanding companies launched plans with premiums well below those of established carriers like UnitedHealthcare, Aetna, Cigna, Mutual of Omaha, and Blue Cross Blue Shield affiliates.
On paper, these plans looked like obvious winners. Lower premiums for the same standardized coverage will naturally attract attention from both consumers and agents.
One example was ACE (Chubb). They entered the Medigap space with pricing that was noticeably lower than that of many competitors. As expected, that pricing led to rapid enrollment growth. But not long after, the company decided to pause new Medigap applications while it evaluated how its claims experience was developing in that block of business. That kind of move usually signals that actual healthcare use is higher than originally projected.
Over the past three years CHUBB has changed their name three times, and now operate under the Name Insurance Company Of North America. They have taken a 7% increase the past three years, and we will not know until July what they are going to do this year.
EDUCATE YOURSELF TO UNDERSTAND WHAT THE MOST COMMON NEXT STEPS ARE FOR MEDICARE SUPPLEMENT CARRIERS.
When a company uses a low-ball technique early on, and once their claims begin to catch up, they often need to adjust premiums more aggressively later to bring things back in line. For beneficiaries, that can mean a plan that started out as one of the lowest-cost options may experience larger-than-average rate increases in future years.
This is exactly why it’s important to look beyond just the initial premium. In the Medigap world, how a company prices over time can matter just as much as how it prices today.
HEALTHCARE COSTS CONTINUE TO RISE ACROSS THE BOARD
It’s important to understand that Medigap rate increases are not happening in a vacuum. They’re part of a much larger trend. Healthcare costs are going up across the board, and those increases eventually show up in insurance premiums, including Medicare Supplement plans.
You can see this clearly by looking at other parts of the healthcare market.
In the Affordable Care Act (ACA) marketplace, insurers proposed average premium increases of around 7% for 2025 in many regions. That’s fairly consistent with what we’ve seen in recent years, and it reflects the same underlying pressure, higher utilization, and rising medical costs.
Employer-sponsored health insurance tells a similar story, but on a larger scale.
Today, the average cost of a family health plan is approaching $27,000 per year, with employees contributing roughly $6,800 to $7,000 annually out of pocket. Employers are also projecting another 6.5% increase in healthcare costs for 2026, which would be one of the largest jumps in over a decade.
Those numbers matter because they show this isn’t just a Medicare issue. It’s happening everywhere.
We’re also seeing pressure in the Medicare Advantage market. Several insurers have pulled back or exited certain markets after experiencing higher-than-expected claims. In some cases, those losses have been significant enough to force major strategic changes.
Nationwide, an estimated 1.4 million Medicare Advantage enrollees were impacted by plan exits heading into 2025.
When you step back and look at the full picture, the pattern becomes clear. Rising healthcare costs are putting pressure on every segment of the system, from employer plans to ACA coverage to Medicare Advantage. Medigap is no exception.
That’s why the larger-than-normal premium increases in 2024 and 2025 shouldn’t be viewed as an isolated event. They’re part of a broader shift in healthcare costs that is working its way through the entire insurance landscape.
WHAT THIS MEANS FOR YOU, THE POLICY OLDER
When rising healthcare costs combine with aggressive market competition and increased utilization, the unusually large Medigap adjustments seen in 2024 and 2025 start to make more sense.
But understanding why it happened doesn’t solve the real issue most people are facing. The most common question we hear is simple:
“My premium went up. What should I do now?”
Let’s walk through the most important things to consider before making a decision.
WE DO NOT ADVISE ANYONE TO RUSH INTO A MEDICARE ADVANTAGE PLAN
When premiums jump, it’s natural to look at alternatives. Medicare Advantage plans often advertise low or even $0 monthly premiums, which can be appealing after a rate increase. But it’s important to look at the full picture.
Medicare Advantage plans typically come with:
Higher potential out-of-pocket costs
Provider networks that may limit which doctors you can see
Prior authorization requirements for certain services
Benefits that can change from year to year
By contrast, Medigap plans work with Original Medicare and allow you to:
See any doctor in the U.S. who accepts Medicare
Avoid network restrictions
Maintain consistent coverage year after year
That stability is a big reason many retirees choose Medigap in the first place. Before leaving Medigap entirely, it’s usually worth exploring other options within the program. Plans like Plan N or High Deductible Plan G can often reduce your premium while keeping the flexibility that Medigap provides. In most cases, Medicare Advantage should be viewed as a last resort option, not your first option after a rate increase.
CHANGING YOUR MEDICARE SUPPLEMENT/MEDIGAP PLAN
One of the biggest misconceptions is that you can only change coverage during the Annual Election Period (AEP) (October 15 to December 7). That’s true for Medicare Advantage and Part D plans, but it does not apply to Medigap. In most states, you can apply to change your Medigap plan at any time of year. This flexibility creates opportunities to shop for better pricing, especially after a significant rate increase.
MEDICAL UNDERWRITING REQUIRED FOR NEW POLICIES AND POLICY CHANGES
Here’s the part many people don’t realize. In most states, switching Medigap plans requires medical underwriting. This means the new insurance company will review your health history before approving your application.
Depending on your health, that can result in:
Approval at standard rates
Approval at higher than standard rates
Or a denial of coverage
Because of this, not everyone will be able to switch plans easily.
STATES THAT HAVE ADOPTED BIRTHDAY RULES FOR MEDICARE
Some states offer additional consumer protections that make switching much easier. These are commonly known as Medigap birthday rules:
CA, OR, NV, ID, UT, WY, IN, KY, IL, OK, MD, DE, LA, VA
If you live in one of these states, you typically have a 30- to 60-day window around your birthday each year to switch Medigap plans without medical underwriting.
IN MOST CASES THE BIRTHDAY RULE ALLOWS A MEDICARE SUPPLEMENT/MEDIGAP BENEFICIARY TO MOVE:
From one carrier’s Plan G to another Plan G
Or from a more comprehensive plan to a less comprehensive one (for example, Plan G to Plan N)
This is a powerful advantage. It lets you shop for lower premiums without worrying about being declined for health conditions.
STATES WITH OTHER CONSUMER PROTECTIONS
Some states go even further than birthday-rule protections and offer broader flexibility for changing Medigap plans, making it easier to adjust your coverage.
For example, in Connecticut and New York, the rules are the most flexible in the country. Medigap plans are available on a guaranteed-issue basis year-round, which means:
You can apply at any time
You cannot be denied coverage
Your premium cannot be increased due to health conditions
This gives beneficiaries the ability to shop for better pricing whenever they want, without worrying about underwriting.
Other states, like Massachusetts, Maine, Missouri, and Washington, offer structured opportunities to switch plans:
Annual switching windows (Massachusetts)
Anniversary rules (Missouri)
Expanded protections that allow certain plan changes without underwriting (Washington)
The details vary by state, but the goal is the same. These rules are designed to give beneficiaries more flexibility to move to lower-cost plans if premiums rise.
WHY IS THIS IMPORTANT?
On the surface, if you reside in one of these states, you have a distinct advantage. Instead of being tied to your current insurance plan due to health conditions, you can regularly review the market and modify your coverage. While this flexibility is advantageous, it also means that insurance companies are modifying their rates to account for the increased risk of adding members without inquiring about their health conditions.
As a result, individuals in these states are experiencing larger annual rate increases than in states without these carve-outs.
For everyone else, switching may still be possible, but it often depends on passing medical underwriting. That’s why understanding your state’s rules is one of the most important steps when deciding what to do after a Medigap rate increase.
HERE IS HOW THESE STATE RULES WORK FOR YOU
In these states, Medigap enrollment is centered around a one-time window known as your Medigap Open Enrollment Period.
This period lasts for six months and begins when you are:
Age 65 or older
Enrolled in Medicare Part B
During this time, you have the strongest protections available, including:
Enroll in any Medigap plan offered in your state
Avoid medical underwriting entirely
Cannot be denied coverage
Cannot be charged more due to health conditions
This is typically the best time to enroll in a Medicare Supplement plan.
AFTER YOUR AEP/OPEN ENROLLMENT PERIOD IS OVER
Once that six-month window ends, the rules change. If you want to switch Medigap plans later, you will usually need to go through medical underwriting.
This means the insurance company can:
Review your health history
Ask medical questions
Approve or deny your application
Because of this, beneficiaries in these states are often more limited when trying to change plans later, especially if their health has changed.
HERE IS WHY THIS IS IMPORTANT
If you live in one of these states, your initial enrollment decision carries more weight. While you can still shop and apply for a lower premium later, approval is not guaranteed.
That’s why many beneficiaries choose to:
Work with an experienced agent upfront
Compare multiple carriers during their Open Enrollment Period
Consider not just price, but also long-term rate stability
In years like 2024 and 2025, when rate increases were higher than normal, these rules are even more important. They explain why some people can easily switch plans to save money, while others may need to stay with their current coverage.
OTHER LOW COST MEDICARE SUPPLEMENT/MEDIGAP PLANS WORTHY OF CONSIDERATION
When premiums increase, many beneficiaries start looking for ways to lower their monthly costs without giving up the core benefits of Medigap.
Two plans consistently come up in that conversation: Plan N and High Deductible Plan G. Both options allow you to stay on Original Medicare, keep nationwide doctor access, and still reduce your premium.
IS PLAN N MORE POPULAR NOW THAN IN THE PAST?
Medicare Supplement Plan N has gained in popularity in recent years, especially as the Medicare Supplement Plan G premiums continued to increase. The reason is simple. It offers coverage very similar to Plan G, but at a lower monthly cost.
Although premiums for Plan N vary from State to State, Plan N premiums are consistently $30-$50 lower than the premiums for Plan G. However, there is a tradeoff. You can see in the Chart Below, all of the benefits for Plan N compared to Plan G. Remember, ALL Medicare Supplement plans are standardized, meaning that the benefits for each lettered plan are exactly the same in all 50 states.
WHAT IS THE TRADE-OFF WITH PLAN N?
With Medicare Supplement/Medigap Plan N, you are responsible for absorbing some cost-sharing that is covered under Plan G:
Up to a $20 copay for doctor visits. Some Doctors do not charge anything, Some Charge $5 - $20, it just depends on what code their office uses. You can always contact your providers and ask them what they charge.
$50 copay for Hospital Emergency room visits, if you are not admitted to the hospital.
No coverage for Part B excess charges. If there are any Excess Charges, you can avoid these by simply making sure that you only see Healthcare Professionals who accept Medicare.
In practice, these costs are often relatively minor, especially for people who don’t visit the doctor frequently.
PLAN N IS A GOOD OPTION FOR MEDICARE BENEFICIARIES WHO:
In generally good health
Those who want to lower their monthly premium
Beneficiaries who are comfortable with occasional, predictable copays
For many, the math is straightforward. Even with a few copays during the year, the premium savings can still come out ahead.
WHY THIS IS IMPORTANT TO UNDERSTAND YOUR OPTIONS
As Plan G premiums have increased, more beneficiaries are taking a second look at Plan N, with factors including:
Lower premium than Plan G
Strong protection compared to Medicare Advantage
Minimal changes to how you access care
That balance is exactly why Plan N has become one of the fastest-growing Medigap plan since 2022.
ANYONE WITH A MEDICARE SUPPLEMENT PLAN F NEEDS TO STRONGLY ENTERTAIN THE OPTION OF SWITCHING OVER TO A MEDICARE SUPPLEMENT/MEDIGAP PLAN G
Referring to the Medicare Supplement Plan Comparison Chart, note that the only difference between PLan G and Plan F is the fact that PLan F automatically pays the Annual Medicare Part B Deductible ($283.00 in 2026) for you. And with Plan G, you pay that first $283 yourself.
The problem is not with the coverage, but once you are past 70, Plan F typically costs more than $100 more per month in premiums when compared to Plan G. So while not having to pay for anything out of pocket is great, it is nullified when you pay more than $30 per month more in higher premiums.
HIGH DEDUCTIBLE PLAN G (HDG) MIGHT BE WORTHY OF CONSIDERATION FOR SOME PEOPLE
We believe a High Deductible Plan G is best suited for those who are financially secure but savvy Medicare Beneficiaries and for those considering a Medicare Advantage Plan.
Typically a HDG plan premium is 1/3 the cost of a regular Plan G.
Medicare pays 80% of all costs after you reach the Annual Part B Deducible threshold of $283.
Your Supplement Insurance will not kick in and pay their 20% share until you have had a total of $2,950 in Out-Of-Pocket costs for the Calendar Year. Once you reach that, your HDG works like a regular Plan G for the remainder of the Calendar Year.
The average Maximum Out-Of-Pocket Expense for a Medicare Advantage HMO Plan nationwide is over $5,500 in 2026. And, you can add on $2,000 more for a Medicare Advantage PPO Plan.
Most Medicare Advantage Plans only cover you in your network, and your network is the county that you live in. The only coverage outside of the county you live in is at any Urgent Care Facility or in a Hospital Facility Emergency Room. This makes it risky for those who like to travel or have multiple homes in different states.
Most people do not have serious health issues that require a Hospital stay, in back to back years. Or, even every three years. This is where the HDG plan can make the most sense.
WRAPPING THINGS UP
Medigap rate increases in 2024 and 2025 caught a lot of people off guard, but when you step back, the reasons are clear. Rising healthcare costs, aggressive pricing strategies from insurers, new and expanding state guaranteed issue enrollment rules, and higher claims across the board all played a role.
If your premium increases, it doesn’t automatically mean you need to leave Medigap or make drastic changes. In many cases, the better approach is to:
Review your current plan
Compare pricing with other carriers
Consider alternatives like Plan N or High Deductible Plan G
Understand your state’s rules around switching
Make sure you are getting the deepest discount possible:
There are two types of discounts for Medicare Supplement policies. The Roommate Discount is typically given if you live with anyone age 60 and older at the same address. And, the Household/Multi-Insured Discount pertains to a Married/Partnered couple who have the same Medicare Supplement plan with the same carrier.
Medicare Supplement plans remain among the most stable and flexible forms of coverage available. You can see any doctor that accepts Medicare, avoid network restrictions, and keep consistent coverage year after year.
One additional bit of information we feel compelled to mention to anyone considering an AARP/UHC Medicare Supplement plan. First, UHC is a great company, financially strong, but they are one of only two or three companies who use a Declining Discount Scale to their Medicare Supplement policies. Meaning that Year on, you get an 11% Discount, then in year two it drops to 9% and then it drops 1% per year over the next 8 years. This is extremely important because you can find yourself upside down quickly, in a market where Double-Digit increases in premiums have become the rule and not the exception.
