Page 2 - Cover Letter and Evaluation for Mary Beth Parsons

Plans G and N include some benefits for medical emergencies while traveling outside the
United States. Benefit designs for all 10 Medigap plans are shown on pages 6-7.

Here are summaries of the three Medigap plans compared in your evaluation. They are listed in
the order of their comprehensiveness, and their estimated annual premiums are for a 65-year-
old woman who lives in Brazos County.

1) Medigap Plan G. This will be the most comprehensive Medigap plan beginning in 2020
when the sale of Medigap Plans F and C will be discontinued. Plan G covers all of
Medicare’s gaps except for the Part B deductible ($183 this year). If you get Plan G, you
will have no cost-sharing for Medicare-covered services after you have paid the Part B
deductible each year. In 2018 a 65-year-old in Brazos County can likely purchase a Plan
G policy for $1,900 a year (or approximately $160 a month). Premiums for this and other
Medigap plans are expected to have future annual increases in the 3%-4% range.

2) Medigap Plan N. This is slightly less comprehensive than Plan G, and it has small
coverage gaps (pages 6-7 show where these gaps are). People in relatively good health
who don’t go to their doctors frequently will likely save $200-$300 a year in this plan
compared to choosing the higher-premium Plan G – even though in this plan you will
have small co-payments from time to time. Estimated premiums are $1,500 a year.

3) Medicare Plan L. This is the least comprehensive of the Medigap plans compared in
your evaluation. One desirable feature is its low $2,560 out-of-pocket limit – it is the
only Medigap plan in your evaluation that has an OOP limit. But the limit does not
include premiums and it applies only to the services the plan covers. As an example, the
Part B deductible ($183) is not covered by this plan and so any money you spend toward
the deductible will not count toward the out-of-pocket limit. Annual premiums for Plan
L are about $1,375.

If you want to consider a less comprehensive Medigap plan like Plan L, the UnitedHealthcare
policies endorsed by AARP will likely permit you to later upgrade to a more comprehensive plan
without answering health-related questions. Some people choose one of the less
comprehensive Medigap plans sold by UnitedHealthcare (or UHC) – Plan N, for instance –
knowing that if they later want to upgrade to a different plan, they can do so without going
through underwriting. If that is something you want to consider, you should verify with UHC
that you’ll later be able to switch to a higher-level plan without having to answer questions
about your health.

Before choosing an insurance company to buy a Medigap policy from, it’s a good idea to get at
least three quotes and to choose a large company that has low premiums. Appendix B is a list of
insurers that sell Medigap policies in Texas, including their telephone numbers. Most insurers
sell only five or six Medigap plans, and some plans, including Plan L in your evaluation, are not
sold by many companies.

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