Page 2 - Cover Letter and Evaluation for Anne Ellzey

Perhaps the most desirable attribute of Medigap policies is the flexibility they offer. You do not
need referrals to see specialists and are covered when you see any provider who accepts
Medicare (as more than 98% of doctors and public hospitals do). Because Medigap policies are
nationally standardized, your benefits and coverage are the same in every state.

Medigap policies do not include prescription drug benefits, and so you will also need to enroll in
a Part D stand-alone drug plan, as discussed in the Rx drug coverage section below. Also,
Medigap policies do not cover routine dental and vision care or hearing aids. Plans F, G, and N
include some benefits for medical emergencies while traveling outside the United States. The
benefit designs for all 10 Medigap plans are shown on pages 6-7. Here are summaries of the
four Medigap plans compared in your evaluation.

1) Medigap Plan F. This is the most comprehensive any Medigap plan, covering all of
Medicare’s gaps. Therefore you will not have anycost-sharing for Medicare-covered
services and the entire cost for Medicare-covered services will be in your premiums.
Beginning in 2020, Plan F (and Plan C) will no longer be sold, although people who
already own this plan at that time may keep it. In Travis County you can likely purchase
a Plan F policy for $1,750 a year or less.

2) Medigap Plan G. This plan’s benefits are identical to Plan F’s except that it does not
cover the Part B deductible ($183 this year). In many instances, people will save money
by choosing Plan G instead of Plan F because their premium savings are greater than the
Part B deductible. Beginning in 2020 when Plans F and C will no longer be sold, Plan G
will be the most comprehensive Medigap plan. Your annual premiums in this plan will
likely be $1,550 or less.

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-$300 a year vs. the higher-premium Plan F. But you will
have co-payments from time to time. Estimated annual premiums are $1,150 or less.

4) Medicare Plan L. This is the least comprehensive of the Medigap plans in your
evaluation. One nice feature is its low $2,560 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 2017) 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 $1,025, although in Texas few insurers sell this plan.

The pricing of Medigap policies

Most people who buy Medigap policies will keep those policies with the same insurance
companies. In a few cases it may be difficult for them to change companies later since they will
have to answer questions about their health and before they can get a policy. It’s prudent,

2