Page 6 - Cover Letter and Evaluation for Forrest Hoover

premiums. As you can see in this list, several plans have zero premiums for both medical and
Rx drug coverage as well as zero deductibles for medical coverage.

Here are summaries of the two Advantage plans compared in your evaluation.

1) AARP Medicare Complete Focus PPO Plan (H2228-020). Like the Humana plan below,
this plan has a four-star quality rating from Medicare and no premiums for either health
or Rx drug coverage. With PPO’s, of course, you have the flexibility to see virtually any
doctor and be covered, although your out-of-network costs can be substantial. In this
plan, for example, you will pay 40% of the cost of some medical services when you go to
an out-of-network provider.

For a PPO, this plan has a relatively small network of 1,000+ providers. Its $4,800
network out-of-pocket limit is average or slightly better than average for a PPO plan, but
the out-of-pocket limit jumps to $10,000 if you combine in-and out-of-network costs.

2) Humana Gold Plus HMO Plan (#5619-051). This plan appears to be a solid choice – it
has a four-star quality rating from Medicare, no premiums for either health or Rx drug
benefits, and a low $3,400 out-of-pocket limit for medical services. Its network of
5,500+ providers in the Fort Wayne metro area gives you a wide range of choices in case
you need to see different doctors.

As you probably know, HMO’s are the most cost-effective type of managed care plan,
and people in good health can save substantial amounts in them. For some people, the
downside is that they can be restrictive – in most HMO’s people must get a referral from
their primary care doctor to see a specialist, while tests and treatments often require
prior approvals. Also, there is no coverage when you see an out-of-network doctor
unless it’s an emergency.

Besides these two Advantage plans, there are two others that may be good candidates for you
and that are compared in your wife’s evaluation. Your costs in those plans will be similar to
hers, the only difference being her slightly higher prescription drug costs.

Rx Drug Plan Coverage

Congratulations on belonging to the 9% of Medicare beneficiaries who do not take any
prescription drugs! Still, even though you do not take any Rx drugs, if you get a Medigap policy
you will also need to enroll in a Part D stand-alone plan to avoid future penalties. You’ll want
the plan that has the lowest premiums – the Wellcare Value Script plan, which has a monthly
premium of $15.50 ($186 a year). You can enroll in this plan by calling (888) 293-5151.

Neither of the Advantage plans in your evaluation has a premium for drug coverage, and so
your annual Rx drug costs will be zero if you don’t have any prescriptions filled during the year.

6