Page 4 - Cover Letter and Evaluation for Craig Callan

(as some 99% of doctors and public hospitals do). That means that you can go to virtually any
doctor, public hospital or clinic in the U. S. and be covered.

Another strength is that Medicare, not the insurance company, makes the coverage decisions.
If Medicare approves a service or treatment, the Medigap insurer must also cover it, up to
policy limits. And because Medicare is more lenient than insurance companies, Medigap
policyholders may in some cases be covered for services and treatments that people in
Advantage plans may not be.

During the first six months after you are enrolled in Part B, you can get a Medigap policy
without answering questions about your health or disclosing pre-existing conditions. After this
six-month period has past, however, in most states (including Maryland and Florida) you will be
medically underwritten before you can get a policy or upgrade from a less comprehensive to a
more comprehensive Medigap plan. Many people, it is true, wait until they are well into their
70s to get their first Medigap policies, but there is a risk that if they have health problems when
they apply, they will either pay higher premiums or be declined coverage.

The benefit designs of all 10 Medigap plans are shown on pages 6-7. Here are summaries of the
two plans compared in your evaluation.

1) Medigap Plan N. This is a fairly comprehensive plan. Its gaps include the Part B
deductible ($185 this year), co-pays of up to $20 for doctor’s office visits, and a $50 co-
pay for emergency room visits. Estimated annual premiums are in the range of $1,300.

2) Medigap High Deductible Plan F. In 2019 this plan has a $2,300 deductible for medical
services, after which all Medicare services are covered at 100%. Estimated annual
premiums are $600, which means the worst out-of-pocket case for Medicare-covered
medical services is $2,900 (the $2,300 deductible plus $600 in premiums). That does not
include prescription drug costs.

Because Medigap policies are supplemental to Medicare, there is less risk in the high-
deductible version of Plan F that some might think. In this plan if you go to see a
specialist and the Medicare-approved cost of the visit is $200, Medicare will pay $160 of
that amount (80%) and you will pay the $40 balance unless the plan’s $2,300 deductible
has been met. Probably the largest single risk in this plan is that if you are hospitalized,
you will pay the $1,364 Part A deductible if the plan deductible has not yet been met. If
it has been met, you won’t owe anything.

The high-deductible version of Plan F will no longer be sold beginning in 2020, although
people who already have this plan may keep it. Starting in 2020, a high-deductible
version of Plan G, which has similar benefits to those of Plan F, will be available.

While your objective is to enroll in an Advantage plan, a Medigap policy could serve as effective
transitional coverage when you move to Florida because your coverage will be the same in both

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