Page 4 - Cover letter and evaluation for Linda Hosier

CSG Actuarial’s premiums can be helpful in a couple of ways. First, they can help to identify the
companies that have lower premiums; second, these quotes also show the insurance
companies’ financial ratings by A.M Best and (for the larger companies) Standard & Poor. They
do not show the companies’ phone numbers, though, which can be found in Appendix B1

Discounts

Insurance companies that sell Medigap policies offer discounts of various kinds. As an example,
some companies have discounts for automatic debit payments of monthly premiums or for
paying a year’s premiums in advance. Discounts are often available when both spouses buy
their policies from the same company. Sometimes these “household discounts” can reduce
your premiums substantially.

In addition, the UnitedHealthcare/AARP Medigap policies have an early enrollment discount
that in your case is 27% below AARP’s standard rate. The discount is calculated by multiplying
3% by the number of years that you are younger than 75. For a 66-year-old, the discount equals
9 years x 3%, or 27%, and it is reduced by 3% each year until you turn 75.

That means that if you acquire an AARP policy, you may have two increases a year – one a 3%
increase associated with the reduced discount (until you turn 75) and the other an increase for
health care inflation. AARP policies can be good choices if they are attractively priced, but you
should be aware that because of the vanishing discount each year until you are 75, your
premiums may rise more quickly than with many other insurers. After you turn 75, the AARP
premiums will likely increase more slowly. The AARP policies also offer a 5% discount when
both spouses buy a policy.

In addition to discounts, some insurers provide extra benefits such as membership in Silver
Sneakers, which give you access to more than 12,000 gyms and health clubs nationally.

Rx Drug Plan Coverage

You will also need to enroll in a Part D stand-alone plan. You might check the list of your Rx
drugs and dosages that is attached to this letter to verify their accuracy – these drugs, dosages,
and monthly quantities were used to find the lowest-cost plans.

The lowest-cost plan in 2018 if you get mail-order refills is the Humana-Walmart Rx Plan. Your
estimated costs are $770 – that includes premiums, deductible, and co-payments. The only
preferred pharmacies in this plan are Walmart Pharmacies, and if you need to have a short-
term prescription filled, it could be more expensive to get it filled at CVS instead of a Walmart
Pharmacy (especially if it’s a brand-name drug).

You can enroll in this plan by calling its toll-free number, shown on page 4 of your evaluation
and in Appendix C2. You will likely need new prescriptions from your doctors, although you can

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