Page 3 - Cover Letter and Evaluation for Sue Marx

Appendix A1. After this six-month period has past, in most states you will be medically
underwritten before you can get a policy or upgrade to a more comprehensive Medigap plan.

Many individuals, of course, get their first Medigap policies in later retirement, but there is a
risk that if they have health problems when they apply, they will either pay higher premiums or
be declined coverage. The benefit designs of all 10 Medigap plans are shown on pages 6-7. Here
are summaries of the two plans compared in your evaluation.

1) Medigap Plan G. This is a comprehensive plan that covers all the gaps in Medicare
except for the Part B deductible, which is $185 in 2019. So, after you’ve satisfied the
Part B deductible, you will not have any co-payments or other cost-sharing for
Medicare-covered services. Beginning in 2020, this will be the most comprehensive
Medigap plan (that’s when Plan F and Plan C will no longer be sold). Your annual
premiums for Plan G should be in the range of $1,400, although premiums may vary
widely depending on the insurer (that’s why it’s good to get at least three quotes).

2) Medigap Plan N. This plan is less comprehensive than Plan G but is still solid coverage.
Its gaps include the Part B deductible ($185 this year), co-pays of up to $20 for doctor’s
office visits, and a $50 co-pay for emergency room visits. Its annual premiums are about
$250 lower than Plan G’s, and if you do not go to the doctor frequently you would
probably come out ahead with this popular Medigap plan.

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 a 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.

The premium comparisons in Appendices A2 and A3 are from CSG Actuarial, a firm that
provides quotes for insurance agents. Some of these premiums may be lower than you can get
because the commissions are not included (there’s no way for me to know which ones these
are). The CSG Actuarial lists may be helpful in a couple of ways. The insurers are listed in order
of their premiums -- from lowest to highest -- which makes it easier to identify the lowest-
premium companies. Also, in most cases the CSG Actuarial comparisons give you the insurers’
financial ratings. The companies’ phone numbers are shown in Appendix A$.

Discounts

Insurance companies that sell Medigap policies may offer discounts of various kinds. As an
example, some companies have small discounts for automatic debit payments of monthly
premiums or for paying for a year’s premiums in advance. The largest discounts are typically
available when both spouses buy their policies from the same company. While not all

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