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Medicare Supplemental Insurance Premiums Increase Significantly Across Multiple Insurers

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Sharp Premium Increases Hit Medicare Supplement Plans

More than 80 customers of Illinois-based broker John Jaggi experienced a 45% premium increase on their Medicare supplemental plan from insurer Chubb in August. Jaggi stated this was the first time in his 49-year career he had seen an immediate increase applied to all customers rather than on policy anniversaries.

More than 12 million people (approximately 43% of those in traditional Medicare) purchase Medigap policies. According to KFF, about 13% of people in traditional Medicare do not have supplemental coverage.

Widespread Rate Hikes

Early 2026 rate filings from major insurers like Aetna, Blue Cross Blue Shield, Cigna, Humana, Mutual of Omaha, and UnitedHealthcare show Plan G policy increases ranging from just over 12% to more than 26% in the first quarter, according to Nebraska-based consulting firm Telos Actuarial.

Brett Mushett, a consulting actuary with Telos, stated these filings indicate carriers are adjusting premium rates due to upward pressure on claims experience.

For Plan G coverage, beneficiaries paid an average monthly premium of $164 in 2023, according to KFF. Agents across the country are reporting significant jumps:

  • Amanda Brewton, owner of Medicare Answers Now, noted that in some states like Ohio, year-over-year increases that were previously 3-5% are now 10-15%.
  • In Alaska, Premera Blue Cross raised Plan G premiums by nearly 12% for this year, according to insurance agent Patricia Mack, who noted another insurer raised rates by nearly 13%.

Chalen Jackson, vice president for government affairs at Integrity, stated that five years ago, rate increases over 10% were exceedingly uncommon, but now increases below 10% are very uncommon and increases over 20% are not uncommon.

Factors Driving the Increases

Insurers, agents, and policy experts cite multiple converging factors for the rising premiums:

  • Increased use of medical services by beneficiaries.
  • An aging population.
  • Increases in labor and medical costs.
  • State rules governing Medigap plans.
  • Enrollment changes in Medicare Advantage plans.

A Premera spokesperson specifically cited Medicare changes to deductible and copayment rates each year, and higher medical service use among members.

The Policy Landscape and Consumer Options

People generally qualify for Medicare at age 65 and have six months after initial enrollment to purchase a Medigap plan at standard rates without health questions. After that, obtaining coverage can be more difficult and expensive.

  • At least 16 states have "birthday rules" requiring insurers to allow annual plan changes without medical underwriting.
  • Four states (Connecticut, Massachusetts, Maine, and New York) require insurers to offer at least one Medigap policy to all applicants either year-round or during annual enrollment periods.

An alternative to traditional Medicare is Medicare Advantage plans, which have out-of-pocket caps but require using in-network providers. However, switching back can be problematic.

Brian Keyser, a research associate at the Center for American Progress, noted that after one year in Medicare Advantage, individuals can be denied Medigap coverage or charged higher premiums due to preexisting conditions.

Exceptions exist when Medicare Advantage plans withdraw from markets. According to KFF, about 2.6 million people lost Medicare Advantage coverage in 2024 when insurers pulled out, with over a million losing coverage for 2025. George Dippel, president of Deft Research, stated that approximately 440,000 of those people switched to Medicare supplement policies.

Some experts note that when insurers enroll people without considering health status, it potentially exposes them to higher healthcare utilization and costs, making premium increases more likely.

Another option mentioned by brokers is Medigap plans with deductibles (currently just under $3,000 annually), which charge lower monthly premiums.

Legislative Considerations

Policy experts have outlined possible solutions, including congressional action to cap out-of-pocket costs for Medicare beneficiaries or subsidize Medigap coverage purchases.

Senator Ron Wyden (D-Ore.) stated that traditional Medicare is the only federal health insurance program without an out-of-pocket cap and needs updating.

However, making Medicare changes requiring congressional approval is considered unlikely in the current legislative environment, particularly because adding an out-of-pocket cap would increase federal budget costs.

This article is based on reporting from KFF Health News, a national newsroom that produces journalism about health issues and is part of KFF, an independent source for health policy research, polling, and journalism.