Page 3 - Cover Letter and Medicare Evaluation for Mrs. Jane Miller

The two Medigap plans compared in your evaluation – Plan G and Plan N -- include some
benefits for medical emergencies while traveling outside the United States. Here are summaries
of the two plans:

1) Medigap Plan G. This is the most comprehensive Medigap plan available to people who
turned 65 in 2020 or later. It covers all of Medicare’s gaps except for the annual Part B
deductible, which is $203 this year. Once you’ve paid the Part B deductible, then, you
will not have any cost-sharing for Medicare-covered services. You can likely purchase a
Plan G policy for $1,500 or perhaps slightly less (about $125 a month). Appendix B2 is a
list of insurance companies’ Plan G premiums from CSG Actuarial.

2) Medigap Plan N. While this plan is slightly less comprehensive than Plan G, it still
provides solid coverage. The only differences between this plan and Plan G are that you
will have co-payments of up to $20 for doctors’ office visits and $50 if you go to the
emergency room. You should be able to get Plan G for about $100 a month ($1,200
annually). Appendix B3 is a list of the Plan N premiums from CSG Actuarial.

The pricing of Medigap policies

If you decide to get a Medigap policy, it’s good to give some thought as to the company that
you will buy your policy from and to make a few calls to get current quotes. While it’s important
to go with a company that has relatively low premiums, you may also want to factor in a
company’s financial strength and size – since you may not be able to switch companies later.
One guideline is that larger companies tend to have slightly lower annual premium increases,
according to a government study a few years ago.

CSG Actuarial’s premium comparisons in Appendix B2 and Appendix B3 may be helpful in a
couple of ways. First, they can serve as a starting point to identify the companies that have
lower premiums; second, they show the insurance companies’ financial ratings by A.M Best and
(in a few cases) Standard & Poor. And for most of the companies, they also show recent years’
premium increases.

CSG Actuarial is a quoting service for insurance agents, and in some cases the premiums shown
in the appendices may not include the commissions (I don’t know which ones they are). But for
most companies, the premiums should accurately reflect what you will pay today. Still, it’s
important to call the insurers to get current quotes.

Premium Discounts

Insurance companies that sell Medigap policies offer discounts of various kinds. Some
companies, for instance, have discounts for automatic debit payments of monthly premiums or
for paying for a year’s premiums in advance. The largest discounts are typically when both
spouses buy their policies from the same company.

3