MEDIGAP: AARP MEMBERS TO SEE 13% INCREASE
"Many seniors with Medicare supplemental insurance throughThis is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
the American Association of Retired Persons will see a 13%
average increase in monthly premiums next year," the Wall Street
Journal reports. The premium hike, which is the "third
consecutive large rise for three million seniors" who get Medigap
coverage through AARP, is "likely to add to the growing ranks of
older people in fast-growing Medicare HMOs." Next year, the AARP
is switching to a new carrier -- Minneapolis-based United
HealthCare -- "after switching from Prudential Insurance Co. of
America" (see AHL 9/16/96). According to Bob Hussey, the vice
president of United HealthCare's AARP/United division, the
insurer "sought rate increases because of expected higher medical
costs and an aging increasingly sick population." He said, "This
was not the way we wanted to be introducing ourselves to AARP
members."
WORRIES
Although consumer advocates were "somewhat sympathetic to
the decision" to raise Medigap rates, they said the "rise is
alarming and fear Medigap coverage will become unaffordable for a
growing number of the weakest and sickest elderly." Consumers
Union's Gail Shearer said, "Great-grandmothers are going to be
priced out of Medigap coverage." Consumer groups also said they
are "concerned" higher premiums "will push older people into
HMOs," which they contend "aren't always well-equipped to care
for the chronically-ill." The Journal notes that Medigap rate
increases have been approved "[i]n more than 40 states ... so
far," including Connecticut (12%), Rhode Island (21%), Arkansas
(16%), New York (15%), California (11%) and Florida (12%)
(Jeffrey, 12/19).