Page 3 - Cover Letter and Evaluation for Patricia Stelter -- PDF version

say that the treatment is not medically necessary). For that reason, people with pre-existing
conditions will usually get a Medigap policy if they are comfortable paying its higher premiums.

Medigap policies do not cover routine vision and dental care or hearing aids, none of which are
covered by Medicare. Neither do they cover prescription drugs, and if you get a Medigap policy
you will also need to enroll in a Medicare prescription drug plan (Part D stand-alone plan). With
the exceptions of seldom sold Plan K and Plan L, Medigap policies do not have out-of-pocket
limits, although that is rarely an issue because Medicare’s underlying catastrophic protection is
strong. Some Medigap plans, including the two compared in your evaluation, include coverage
for foreign travel emergencies.

During the first six months that you have Part B, insurance companies are required to sell you a
Medigap policy without asking health-related questions. But after that six-month guaranteed
issue is past, insurance companies can ask applicants about pre-existing conditions and can
charge higher premiums or deny coverage.

In Illinois, however, there is an exception to this rule – Blue Cross Blue Shield of Illinois will sell
Medigap policies without asking health-related questions to people who have past their initial
guaranteed-issue period – see page 5 of Appendix B1. If Blue Cross Blue Shield continues this
policy in the future, it will give you a potentially valuable option. As an example, if you initially
enroll in an Advantage plan and a few years from now want to switch to a Medigap policy, then
you could get a BCBS of Illinois policy.

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 Illinois Department of Aging’s
listings of each company’s phone numbers and Medigap premiums are in Appendix B1. This list
was last revised about two weeks ago, and so the premiums should be current. Still, 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 some 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 the eight 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 (it will be a few dollars
higher in 2021, in all likelihood). That means that after you have satisfied the Part B
deductible you will not have any co-payments or other cost-sharing for Medicare-

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