Page 3 - Cover Letter and Medicare Evaluation for Donald Pender

Comparing two Medigap plans

The two Medigap plans compared in your evaluation – Plan G and Plan N – are similar, and they
are two of the most popular plans. The benefit designs of these two plans (as well as other
Medigap plans) are shown on pages 6-7 of the evaluation. Here are summaries:

1) Medigap Plan G. This is the most comprehensive Medigap plan available to people who
turned 65 in 2020 or later. It covers all of Medicare’s gaps except for the annual Part B
deductible, which is $203 this year. That means that once you’ve paid the Part B
deductible, you will not have any further cost-sharing for Medicare-covered services.
You can likely purchase a Plan G policy for about $1,850 a year (roughly $155 a month)
or possibly less. Appendices A1 and A2 show insurance companies’ Plan G premiums –
those in Appendix A1 are from the California Dept. of Insurance and include the
companies’ phone numbers; those in Appendix A2 are from CSG Actuarial. Some of the
premiums shown in Appendix A1 may be out of date, and a few of the premiums shown
in Appendix 2 may not include agents’ commissions.

2) Medigap Plan N. This plan is slightly less comprehensive than Plan G, but it still provides
excellent coverage. The only differences between this plan and Plan G are that you will
have co-payments of up to $20 for doctors’ office visits and $50 if you go to the
emergency room. You should be able to get Plan N for about $1,650 a year or less.
Appendices A1 and A3 show each company’s Plan N premiums.

The pricing of Medigap policies and California’s Birthday Rule

If you decide to get a Medigap policy, 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 go with a company that has relatively low premiums, you may also want to factor in a
company’s financial strength and size. One guideline is that larger companies tend to have
slightly lower annual premium increases, according to a government study a few years ago.

CSG Actuarial’s premium comparisons in Appendix A2 and Appendix A3 may be helpful in a few
ways. First, they can serve as a starting point to identify the companies that have lower
premiums; second, they show the companies’ financial ratings by A.M Best and (in a few cases)
Standard & Poor. And for many insurers, they show recent years’ premium increases.

CSG Actuarial is a quoting service for insurance agents, and in some cases the premiums shown
in the appendices may not include commissions (I don’t know which ones they are). But for
most companies, the premiums shown should accurately reflect what you will pay today. Still,
it’s important to call the insurers to get current quotes.

Some companies offer discounts of various kinds. A few companies, for instance, will offer a
discount for automatic monthly debit payments or for paying a year’s premiums in advance.
And some companies offer a discount when both spouses buy a Medigap policy. The companies

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