Although the benefits from Medicare supplement insurance, also known as Medigap, have been standardized since 1992, consumers continue to encounter striking differences in premium rates for policies that offer identical coverage, says Weiss Ratings Inc.


Weiss, the big Jupiter, Fla.-based provider of ratings of financial services companies, banks, and insurers, analyzed premium rates offered by 117 of the 159 insurers that write Medigap policies and found wide variation in rates.


The average cost of a Medigap policy for a 65-year-old female ranged from $1,159 to $3,443 per year. Pricing disparities are even more dramatic on specific plans. For instance, rates for the popular Plan C varied from a minimum of $651 to more than $9,000.


Regional differences in health costs, insurers underwriting and pricing methodologies, the health status of the target population, and state policies regulating rates account for the wide pricing disparities, says Weiss. In reviewing the rates for a 65-year-old female, Weiss found the following pricing contrasts:


In Arizona, Plan C cost $976 with Pennsylvania Life Insurance Co., while Guarantee Trust Life Insurance Co. issued the same policy for $2,735. In Ohio, the same plan ranged from $888 with Paramount Insurance Co. to $3,622 with Mutual Protective Insurance Co.a 300 percent difference.


In Pennsylvania, premiums for Plan F varied from a low of $1,236 with Humana Insurance Co. to a high of $2,655 with Standard Life & Accident Insurance Co., while rates in Indiana ran from $940 with Lincoln Heritage Life Insurance Co. to $3,304 with Oxford Life Insurance Co.