AARP Medigap Premium Increases, 1996

HEHS-96-119R: Published: Apr 19, 1996. Publicly Released: Apr 19, 1996.

Additional Materials:

Contact:

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Pursuant to a congressional request, GAO examined why Medigap premiums offered through the American Association of Retired Persons (AARP) were increasing. GAO noted that: (1) premiums for more than 3 million AARP Medigap policyholders increased an average of 26 percent; (2) the increases varied by state and ranged between 0 to 40 percent for both standardized and prestandardized policies; (3) in 1994 and 1995, premiums increased in 8 and 10 states, respectively; (4) because benefit payments were less than expected, AARP standardized policyholders received an average credit of $75 and prestandardized policyholders received an average credit of $79 in 1994 and 1995; (5) in 1992, policyholders in 45 states received refunds averaging $47 because of lower than expected benefit payments; (6) AARP believes that the 1996 Medigap rate increases are justified because the number of services received and costs incurred by policyholders substantially increased; (7) although the average Medigap loss ratio decreased to 81 percent between 1991 to 1993, in 1994, the average loss ratio ratio increased to 93 percent; (8) in 1994, average loss ratio for prestandardized policies was 98 percent and 82 percent for standardized policies; and (9) the average loss ratio for 1995 policies was 100 percent and could increase to 112 percent without a rate increase.

Sep 28, 2016

Sep 15, 2016

Sep 14, 2016

Sep 12, 2016

Sep 9, 2016

Sep 6, 2016

Aug 31, 2016

Looking for more? Browse all our products here