Page 1 - Cover Letter and Medicare Evaluation for Michael Bichy

November 7, 2022

Mr. Michael E. Bichy
25412 Robin Tree Lane
Ocean View, DE 19970

Dear Mr. Bichy,

Your 2023 Medicare evaluation is enclosed. As you may know, if you plan to change your drug
coverage, you will need to do that by the conclusion of Medicare’s annual open enrollment
period on December 7. But you may switch from one Medigap plan (or from your current
Medigap insurer – AARP) to a different Medigap plan or insurer at any time of year although
you’ll subject to medical underwriting.

Your evaluation compares two Medigap plans – your current Plan F and Plan N -- and two
Medicare Advantage plans. As you are aware, Plan F (as well as Plan C) are not available to
people who turned 65 in 2020 or later. But individuals like you who turned 65 before 2020 may
continue to get Plan F and Plan C (see the attachment to this letter).

Because Plan F and Plan C are being phased out, some insurance analysts have wondered
whether these two plans’ policyholders should switch to a less comprehensive Medigap plan.
Their concern is that in the coming years as the number of Plan F policyholders shrinks, those
who remain could be subject to higher premium increases and at that point may not be able to
switch to less comprehensive Medigap plans.

While it’s difficult to know if that’s a valid concern, it might be smart for you, a younger retiree
in good health, to switch to a slightly less comprehensive Medigap plan that is not being phased
out. Plan G and Plan N are both good candidates if you decide to switch, and you might also
save money in the process.

While there may be some risk in continuing with Plan F, there’s also a risk in switching to a
Medicare Advantage plan. If you were to do this, you would likely save money, at least in the
short term, but you would not be able to switch back to a Medigap policy in later retirement
without being medically underwritten and possibly charged a high premium or denied coverage
(in that case you would have to remain in an Advantage plan). Because retirees use more
medical services as they grow older, they may find that Advantage plans restrict their options
more than will Medigap policies. Here’s an overview of how these two types of coverage work.

How Medigap policies work

When people first enroll in Part B, they have a six-month guaranteed issue period to purchase a
Medigap policy without answering questions about their health or pre-existing conditions. But