Page 6 - Cover Letter and Medicare Evaluation for Barbara Pender

You belong to a select group – estimated at 10% of Medicare beneficiaries -- who don’t take
any prescription drugs. As noted, there are no premiums or deductibles for drug coverage in
the Advantage plans, and unless you need a prescription filled, you’ll have no drug expenses.

If you get a Medigap policy, you will also need to enroll in a stand-alone drug plan (even though
you do not take any Rx drugs). Next year’s stand-alone drug plan with the lowest premiums is
the SilverScript SmartRx Plan, which has a $7.50 monthly premium and a $480 deductible.

If you do need a prescription filled, you may save money by having it filled at one of a plan’s
preferred pharmacies. In many cases, the savings you get at one of your plan’s preferred
pharmacies will be small (or non-existent). Occasionally, though, you may save money at a
preferred pharmacy. Each plan’s preferred pharmacies are listed on page 4 of your evaluation.

Comments

You will save money by enrolling in Advantage plan and seeing only network doctors. The risk is
that if you later want to switch to a Medigap policy, insurance companies will ask questions
about your health status, and you might either pay steep premiums or be denied coverage.
That said, many people wait until they are in their 70s to get their first Medigap policies.

Advantage plans are ideally suited for people in good health who do not go to their doctors
often and do not see several specialists. As people age, of course, they are likely to need more
medical services from more specialists, some of whom may not be in any Advantage plan
networks.

Barbara, please let me know if you have any questions. There are a couple of things to keep in
mind as you make the transition to Medicare as your primary coverage. On your initial visits to
your new doctors after January 1, show the office staff your enrollment cards for Medicare A&B
and the Advantage plan you’ve selected. And on your first visit to the pharmacy, show them the
enrollment card for the plan you’re enrolled in. That will help to avoid any billing confusion.
Also, you’re entitled to a free “Welcome to Medicare” physical (see page 11 of the evaluation),
but you may have to request it.

Sincerely,

David Armes, CFP®

Appendices

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