Page 3 - Cover Letter and Evaluation for Bob Workman

than those of Plan N, although there is a great deal of variation in premiums from one
insurance company to the next.

Plan N (your current plan). This plan is less comprehensive than Plan F, but it still provides solid
coverage. If you decide to stick with Plan N and try to lower your costs by finding companies
with lower premiums than those of UnitedHealthcare/AARP, you might contact USAA Insurance
at the number shown in Appendix B1. According to the premiums shown in this Appendix, you
can save almost $220 a year by switching your Plan N policy to USAA Insurance.

As you probably know, USAA is an organization for military veterans, but you do not have to be
a veteran to buy its Medigap policies (this is a moot point if you are a veteran). According to the
premiums listed in Appendix B1, which were updated earlier this month, USAA has a $121
monthly premium for Plan N.

Appendix B2 lists Medigap Plan N premiums from CSG Actuarial – this list is sorted so that the
lowest annual premiums are listed first. For some reason the USAA Plan N premiums are not
listed here. The premiums shown for UnitedHealthcare/AARP are the same as those you are
currently paying. The CSG Actuarial list does not include the companies’ telephone numbers
but Appendix B1 does show each company’s phone number if you want to call to get a current
quote.

Plan K. This plan is substantially less comprehensive than either of the other Medigap plans in
your evaluation, and its premiums are roughly one-half as much as you are currently paying for
Plan N. You could save money in this plan unless you had expensive tests and treatments. Plan
K is one of only two Medigap plans that have an out-of-pocket (OOP) limit. In 2017 the OOP
limit is $5,120, and it might be slightly higher in 2018.

This OOP limit does not include the plan’s premiums or costs for services that the plan doesn’t
cover. As an example, this plan does not cover the Part B deductible ($183 in 2017), and so any
money you spend to satisfy this deductible does not count toward the OOP limit.

Plan K is designed for people in good health who are willing to accept some risk in as a tradeoff
for lower premiums. Its benefit design is shown on pages 6-7 of your evaluation (along with
those of the other Medigap plans).

The Medicare Advantage plan in your evaluation

I selected the Humana Choice PPO Plan (H5216-046) to include in your evaluation. There are
two Humana Choice PPO Advantage plans in your area – the other one includes Rx drug
coverage (which is too expensive for your Rx drugs). But the Humana plan in your evaluation,
does not have prescription drug benefits, and that enables you to get the very low-cost Envision
Rx Plus prescription drug plan described in the Rx drug coverage section below. If you decide to
enroll in this Advantage plan, make sure that Humana understands you are enrolling in the
Humana Choice Advantage PPO plan that does not include Rx drug coverage.

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