Page 3 - Cover Letter and Evaluation for Stephen Spero

Individuals who turned 65 before 2020 can choose from the 10 Medigap plans shown on pages
6-7 of the evaluation. Because of a change in the law, those who turn 65 this year or later have
only eight plans to choose from, and they will not be able to get Plan C or Plan F. Even though
you turned 65 in 2018 and can choose from 10 plans, it’s probably best to limit your choices to
the eight plans that will be most actively sold in the future.

To get current quotes on a Medigap policies, you will need to call the insurance companies that
sell them. It’s a good idea to call at least three companies. The California Department of
Insurance listings of each insurance company’s Medigap premiums are in Appendix B1, as are
the companies’ phone numbers. Some of these premiums may be out of date, which is why it’s
important to call the companies to get current quotes.

The Medigap Plan G and Plan N premiums shown in Appendices B2 and B3 are from CSG
Actuarial, a firm that provides quotes for insurance agents. While these premiums should be
current, in a few cases they may not include the agents’ commissions (there is no way for me to
know which ones these are). These premium comparisons also show each company’s premium
increases for the last four years, and in some cases the company’s financial strength ratings
from AM Best and from Standard & Poor’s (S&P). The companies’ phone numbers are not
included in these appendices but are shown in Appendix B1.

The benefit designs of all 10 Medigap plans are shown on pages 6-7 of the evaluation. Here are
summaries of the two plans compared in your evaluation:

1) Medigap Plan G. This is a comprehensive plan that covers all of Medicare’s healthcare
gaps except for the Part B deductible, which this year is $198. That means that after you
have satisfied the Part B deductible you will not have any co-payments or other cost-
sharing for Medicare-covered services for the remainder of the year. Premiums vary
widely (as you can see in the appendices). For Plan G, you should be able to get a policy
for about $1,700 a year or slightly less.

2) Medigap Plan N. This plan is less comprehensive than Plan G but is still very good
coverage. Its gaps include the $198 Part B deductible, co-pays of up to $20 for doctor’s
office visits, and a $50 co-pay for emergency room visits. Annual premiums are roughly
20% lower than Plan G’s, and if you do not go to the doctor frequently you would
probably save money in this plan compared to what you would pay in Plan G. You can
likely get Plan N for about $1,500 a year or less.

Medigap Pricing and Discounts

Companies that sell Medigap policies often offer discounts. As an example, some companies
offer small discounts for automatic debit payments or for paying a year’s premiums in advance.

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