Page 3 - Cover letter and evaluation for Paulina Rosenstein

3) Medigap Plan N. This is slightly less comprehensive than Plans F and G, and it has some
small gaps. In this plan, people in relatively good health who don’t go to their doctors
frequently will likely save $200-$400 a year vs. the higher-premium Plan F. But you will
have co-payments from time to time. Estimated annual premiums are $2,775.

4) Medicare Plan L. This is the least comprehensive of the four Medigap plans compared
on pages 2-3 of your evaluation. One nice feature is its low $2,620 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 applies only to the services the plan covers. As an example,
the Part B deductible ($183 in 2018) is not covered by this plan and so any money you
spend toward the deductible will not apply to the out-of-pocket limit. Annual premiums
for Plan L are about $2,575, although in New York relatively few insurers sell this plan.

The pricing of Medigap policies

Premiums for the four Medigap plans in your evaluation are shown in Appendices B1 through
B5. The premiums in Appendix B1 are from the New York Department of Financial Services, and
they were current as of January 1. The premiums in Appendices B2 through B5 are from CSG
Actuarial, a firm that provides quotes for insurance agents. Some of the premiums listed may
be lower than you can get because commissions are not included (unfortunately, there’s no
way to filter these out or for me to know which ones they are). Most of the premiums, though,
should be accurate.

CSG Actuarial’s premiums may be helpful in a couple of ways. First, they are listed from lowest
to highest, and so can serve as a starting point to identify the companies that have lower
premiums. Then you can call three or more of those companies for current quotes. Second, CSG
Actuarial also shows the insurance companies’ financial ratings by A.M Best and (in the case of
larger insurers) Standard & Poor.

The state of New York’s regulations on the pricing of Medigap policies gives consumers a great
deal of flexibility to acquire a Medigap policy in later retirement, to switch from one plan to
another, or to change from one insurance company to another -- all without having to answer
health-related questions. Thus if you initially choose a less expensive and comprehensive plan
such as Plan N, you can later upgrade to a more comprehensive plan without going through
medical underwriting. These regulations are summarized in Appendix A1.

Rx Drug Plan Coverage

You mentioned that because your husband’s employer plan includes prescription drug
coverage, you do not currently need to enroll in a Part D stand-alone plan. When your husband
eventually retires, at that point you may need to enroll in a Part D stand-alone plan (this is
assuming that he will not have retiree health coverage that includes Rx drug benefits).

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