(MONEY Magazine) – With Medicare's new catastrophic coverage picking up more of the health-care tab for older Americans, you might think that medigap insurance -- the private policies that pay the portion of costs that Medicare expects you to pay -- would cost less this year. Well, it doesn't. In fact, most insurers have raised their premiums, although the new coverage has cut the maximum out-of- pocket cost for hospital bills to just $764 (it will cap covered doctor bills next year at $1,370). Why isn't the price of medigap coming down? The private insurers blame the rising cost of medical care, among other things. But that doesn't square with a finding by the General Accounting Office. In April, the agency released a survey showing that most medigap sellers are returning in benefits less than 60% of what they receive in premiums -- even though a laxly enforced federal law says they should meet the 60% mark. Among the offenders: Federal Home Life of Florida, which paid back just 47 cents on the dollar, and Globe Life of Oklahoma, which paid about 51 cents. The companies argue that the government looked at paybacks from single calendar years, rather than cumulative averages, which were higher. The best payers were Prudential, which returned 83 cents on the dollar, and several Blue Cross plans, which -- because their rate increases were tightly restricted by regulatory boards -- returned more than a dollar in benefits for each premium dollar. Low payouts are not the only problem in the medigap industry. According to testimony before the House Energy and Commerce Committee in April, some salesmen are using high pressure to sell duplicate medigap policies to the elderly. The moral? Just shop carefully, of course. If you'd like advice on how, send for the booklet The Consumer's Guide to Medicare Supplement Insurance, available free from the Health Insurance Association of America (P.O. Box 41455, Washington, D.C. 20018).