What is the difference between community-rated, issue-age-rated, and attained-age-rated premiums?

The correct answer provides a clear distinction between the three premium rating methods used in Medicare Supplement Insurance. Community-rated premiums are set uniformly across all policyholders, meaning everyone pays the same monthly premium regardless of their age or health status. This structure helps to avoid any age discrimination and simplifies pricing for all enrollees.

Issue-age-rated premiums are determined based on the age at which a person applies for the insurance. This means that younger individuals will pay a lower premium than older applicants, and the premium remains the same as long as they keep the policy. However, these premiums do not increase as the insured person grows older, creating a more predictable cost for those who enroll at a younger age.

Attained-age-rated premiums, on the other hand, are influenced by the current age of the policyholder. As the person ages, their premiums will typically increase over time. This means that although the initial cost might be lower when one first enrolls, the policyholder can expect to see their premiums rise as they get older.

The other choices do not accurately reflect the nature of these premium rating methodologies, which is why they do not convey the correct distinctions as outlined in the chosen answer.