Page 2 - Cover letter and evaluation for Geoffrey Newman

more comprehensive plan, or switch their policy to another insurer after the initial six-month
guaranteed-issue period.

Perhaps the most desirable attribute of Medigap policies is the flexibility they offer. As
mentioned, there are no networks, and you will be covered when you see any provider who
accepts Medicare (as some 98% of doctors and public hospitals do). That means you will have
the ability to go to virtually any doctor, hospital or clinic in the U. S. and be covered.

Medigap policies do not cover routine dental and vision care or hearing aids. Plans F, G, and N
in your evaluation do include some benefits for medical emergencies while traveling outside
the United States (as shown on pages 6-7). Following are summaries of the four Medigap
options compared in your evaluation. They are listed in the order of their comprehensiveness.

1) Medigap Plan F. The most comprehensive Medigap plan, covering all of Medicare’s
gaps. If you get Plan F, then, you will have no cost-sharing for Medicare-covered
services. In Johnson County, you can likely purchase a Plan F policy for $2,000 a year or
less. Beginning in 2020, Plan F and Plan C will no longer be sold, although policyholders
who already have either of these plans at that time may keep it.

2) Medigap Plan G. This plan’s benefits are identical to those of Plan F except that it does
not cover the Part B deductible, which in 2018 is $183. Frequently people will save
money by choosing Plan G instead of Plan F because they will save more in premiums
than they will pay for the Part B deductible. Estimated annual premiums are $1,800.

3) Medigap Plan N. This is slightly less comprehensive than Plans F and G and it has some
small gaps (pages 6-7 show where these gaps are). People in relatively good health who
don’t go to their doctors often will likely save $200-$300 a year in this plan compared to
the higher-premium Plan F. Estimated annual premiums are $1,500 a year.

4) Medicare Plan L. This is the least comprehensive of the four Medigap plans compared in
your evaluation. One nice feature of Plan L is its low $2,620 out-of-pocket limit – it is the
only Medigap plan in your evaluation that has an OOP limit. But the limit does not
include premiums and applies only to the services the plan covers. As an example, the
Part B deductible is not covered by this plan and so any money you spend on the
deductible will not apply to the out-of-pocket limit. Annual premiums for Plan L are
about $1,400.

The pricing of Medigap policies

It’s good to give some thought as to the company that you will buy your policy from and to
make a few calls to get current quotes. While it’s important to choose a company that has
relatively low premiums, you may also want to factor in the company’s financial strength and
size. As a rule, larger companies have slightly lower annual premium increases, according to a
government study a few years ago.

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