Stable Rates
- Thread starter Heck13
- Start date
You are about to get 27 different answers.
Over the course of 35 years (to age 100) AND if your parents cannot change companies (medical underwriting is required after the initial enrollment period), then BCBS is the most stable in TX.
But...you pay more until you hit 70-ish.
So at age 65, you can get Transamerica Plan G at $103. (I'm not dealing with household discounts for this. Plus, I am rounding up. But it gives you a general idea.). BCBS is $137 for an identical plan. So its $410 more, annually, to get BCBS.
At age 70, Cigna is significantly less at $112 compared to BCBS at $183. But this assumes you are healthy and can move to Cigna.
This is what I say to people (a lot):
"Plan G is Plan G is Plan G. It doesn't matter who the carrier is. All the carriers, except BCBS and AARP play a game. They open a book and they close an old book. Right now, Transamerica ABC is the least expensive carrier with low, great rates and will continue to be the least expensive carrier for 2-3 years. At that point, Transamerica ABC will stop taking new clients as they open up a new company called Transamerica XYZ. Transamerica XYZ will also have low, great rates. The ABC company will continue to have a great plan, but the pool will be getting older and unfortunately, sicker. With no one 65 and healthy jumping in the pool to keep rates down, the rates will start to rise. To get the low, great rates, you have to complete underwriting. If you can't, you are stuck. $410 is a lot money, though and you need to decide. I am fine with either company. The only rule is that you are not allowed to yell at me if you cannot move companies later and the rates have skyrocketed".
To give you an example, I just had a 78 year old woman call me who was on Loyal American. Loyal America was Cigna's name for Med Supp 13 years ago. She is healthy and paying $312 for Plan F. I was able to move to her to Cigna at $150. BCBS was $222.
If your parents are in great health (by an insurance company standard, not normal people standard) then saving more than $800 a year is a great bet. If you are going into it knowing they will never be able to switch, go Blue.
I get your question a lot. "What are you parents on?"
Blue.
Full disclosure: I am an agent in Texas.
Over the course of 35 years (to age 100) AND if your parents cannot change companies (medical underwriting is required after the initial enrollment period), then BCBS is the most stable in TX.
But...you pay more until you hit 70-ish.
So at age 65, you can get Transamerica Plan G at $103. (I'm not dealing with household discounts for this. Plus, I am rounding up. But it gives you a general idea.). BCBS is $137 for an identical plan. So its $410 more, annually, to get BCBS.
At age 70, Cigna is significantly less at $112 compared to BCBS at $183. But this assumes you are healthy and can move to Cigna.
This is what I say to people (a lot):
"Plan G is Plan G is Plan G. It doesn't matter who the carrier is. All the carriers, except BCBS and AARP play a game. They open a book and they close an old book. Right now, Transamerica ABC is the least expensive carrier with low, great rates and will continue to be the least expensive carrier for 2-3 years. At that point, Transamerica ABC will stop taking new clients as they open up a new company called Transamerica XYZ. Transamerica XYZ will also have low, great rates. The ABC company will continue to have a great plan, but the pool will be getting older and unfortunately, sicker. With no one 65 and healthy jumping in the pool to keep rates down, the rates will start to rise. To get the low, great rates, you have to complete underwriting. If you can't, you are stuck. $410 is a lot money, though and you need to decide. I am fine with either company. The only rule is that you are not allowed to yell at me if you cannot move companies later and the rates have skyrocketed".
To give you an example, I just had a 78 year old woman call me who was on Loyal American. Loyal America was Cigna's name for Med Supp 13 years ago. She is healthy and paying $312 for Plan F. I was able to move to her to Cigna at $150. BCBS was $222.
If your parents are in great health (by an insurance company standard, not normal people standard) then saving more than $800 a year is a great bet. If you are going into it knowing they will never be able to switch, go Blue.
I get your question a lot. "What are you parents on?"
Blue.
Full disclosure: I am an agent in Texas.
Pay attention when 2020 rolls around. My money says all the carriers will be introducing a new block and closing the existing ones.
Most, if not all did it in 2010 when Modernized plans hit the streets.
New applicants get lower rate, the legacy policyholders pay higher rates to subsidize the new enrollee's
Most, if not all did it in 2010 when Modernized plans hit the streets.
New applicants get lower rate, the legacy policyholders pay higher rates to subsidize the new enrollee's
- 586
I agree with you 100%. I write a lot in TX , Aetna actually beat philly over the last 5 years or so. Long-term for myself/family member. I'd use philly. Since Aetna bought CLI/ACI, I've started to like them less and less, they're just a pain in the ass to deal with. Philly isn't... I will say Philly starts to get pricey with big jumps over 80. Not a problem for a long time, but just their attained age increases over 80 are higher than most companies.
Somarco is on to something though, it probably isn't going to matter much in a few years.
You can certainly look at current and past rates, along with what happens when a block is closed and new one opens.
But how a carrier manages their block has a bigger impact than any.
What happens when one carrier offers a 12% discount and does not require a 2nd policyholder vs another that has a 6% discount but requires a 2nd policyholder? And others have no discounts.
They can't all be right.
Question is, which one is more right?
Discounts are a marketing ploy to attract new policyholders and have no direct bearing on claims, but they do impact loss ratio's. A carrier with a large enough block to be credible will have roughly the same per capita claims as any other carrier with similar underwriting practices.
Is a 2 yr look back better than a 5 yr look back on claim history?
Is a carrier that writes a significant portion of their block on T65 more stable than one that balances T65 with underwritten business?
And how about the carriers that "attract" GI business because of commission practices?
All these factors and more impact claims which in turn are reflected in loss ratio's. Higher loss ratio's demand higher rate increases.
Higher commissions and low premiums don't help the situation. The LR is squeezed when there are fewer dollars left to pay claims.
But how a carrier manages their block has a bigger impact than any.
What happens when one carrier offers a 12% discount and does not require a 2nd policyholder vs another that has a 6% discount but requires a 2nd policyholder? And others have no discounts.
They can't all be right.
Question is, which one is more right?
Discounts are a marketing ploy to attract new policyholders and have no direct bearing on claims, but they do impact loss ratio's. A carrier with a large enough block to be credible will have roughly the same per capita claims as any other carrier with similar underwriting practices.
Is a 2 yr look back better than a 5 yr look back on claim history?
Is a carrier that writes a significant portion of their block on T65 more stable than one that balances T65 with underwritten business?
And how about the carriers that "attract" GI business because of commission practices?
All these factors and more impact claims which in turn are reflected in loss ratio's. Higher loss ratio's demand higher rate increases.
Higher commissions and low premiums don't help the situation. The LR is squeezed when there are fewer dollars left to pay claims.
Any concerns with Aetna "Outlook: Negative, Under Review" by AM Best? At least in Ohio it started showing up that way I think around mid-January. I know a lot of us write Aetna and I was curious if it caused anyone pause recently. Not to hijack the thread....
.....
Anyway - I have nothing new to add that the others have not added. I like KGMom's process: go with low if you'd like to save $ and are OK with the risk that you may be paying more later - pay more now if you really want the stability of the larger carrier.
My parents are in NC and my mom turns 65 in 3 days on 2/20 - so I just had to do what you are doing now. I put her and my dad with MOO Plan N (switched my dad from IAC). All factors considered, including possible rate hikes, it made the most sense for now.
.....
Anyway - I have nothing new to add that the others have not added. I like KGMom's process: go with low if you'd like to save $ and are OK with the risk that you may be paying more later - pay more now if you really want the stability of the larger carrier.
My parents are in NC and my mom turns 65 in 3 days on 2/20 - so I just had to do what you are doing now. I put her and my dad with MOO Plan N (switched my dad from IAC). All factors considered, including possible rate hikes, it made the most sense for now.
Had not noticed the Aetna change. I assume you are referring to CSG footnotes.
Frankly, I never pay attention to AM Best ratings unless the carrier is unrated. More concerned about how long they have been in the Medigap market.
In GA we have Aetna, Aetna H & L, and now ACI. All 3 are showing outlook negative.
I suppose that has more to do with the failed Aetna - Humana merger and the more recent Aetna - CVS deal. Financial rating companies like stability. Takeover's and mergers give them pause.
Plan N has the most rate stability so far (if you discount for the MOO early Plan N fiasco). Other carriers that did not get on the stupid train have had very nominal increases on N.
Most of my clients have G but more are buying N. I do try to steer them away from N if they live in south Georgia. Mayo is across the line in Jax and they don't take assignment.
My philosophy always has been to look for carriers with at least 5 years in the Medigap market under the same name. Almost impossible to find that now outside of BX, UHC and Humana.
Almost everyone else has anywhere from 2 months in business in Georgia to less than 5 yrs. Carriers I used to rely on have now joined the carrier rotation game so I have to temper my advice.
I moved more clients last year than all totaled for the previous 6 years in the business. Hope I don't have a repeat this year.
Frankly, I never pay attention to AM Best ratings unless the carrier is unrated. More concerned about how long they have been in the Medigap market.
In GA we have Aetna, Aetna H & L, and now ACI. All 3 are showing outlook negative.
I suppose that has more to do with the failed Aetna - Humana merger and the more recent Aetna - CVS deal. Financial rating companies like stability. Takeover's and mergers give them pause.
Plan N has the most rate stability so far (if you discount for the MOO early Plan N fiasco). Other carriers that did not get on the stupid train have had very nominal increases on N.
Most of my clients have G but more are buying N. I do try to steer them away from N if they live in south Georgia. Mayo is across the line in Jax and they don't take assignment.
My philosophy always has been to look for carriers with at least 5 years in the Medigap market under the same name. Almost impossible to find that now outside of BX, UHC and Humana.
Almost everyone else has anywhere from 2 months in business in Georgia to less than 5 yrs. Carriers I used to rely on have now joined the carrier rotation game so I have to temper my advice.
I moved more clients last year than all totaled for the previous 6 years in the business. Hope I don't have a repeat this year.
- 6,455
There is a gift in the post immediately preceding yours which you would do well to consider.
There is another alternative besides "low" and "high". There is (are) a middle way (or ways) through the maze and there is a thought process an experienced and knowledgeable agent can apply.
I do not completely understand the post. If I did understand the post, I have no access to the information needed to do the thinking. I once tried to gather a "more limited version" of the ideas/information presented there-that was terribly, terribly difficult and then I was attacked just as hard for trying to use it as I was for trying to gather it.
Nor can I be sure how one might use finding a middle way in relation to selling the product.
So all I can say is "there is a gift in somarco's post". I hope that those who are able to use it will recognize it as such.
- 503
Great comment! What many people think is good health is often different from what an insurance company thinks is good health.
