Page 3 - Cover Letter and Evaluation for Anne Ellzey

then, to give some thought as to the company that you buy your policy from. 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. As a rule, larger companies have slightly lower
annual premium increases, according to a government study a few years ago.

Premiums for the four Medigap plans in your evaluation are shown in Appendices B2 through
B5. These are from CSG Actuarial, a firm that provides quotes to insurance agents. Some
premiums may be lower than you can get because the commissions may not be included
(unfortunately, there’s no way to filter these out or for me to know which ones they are). Most
of the premiums, though, should be accurate.

CSG Actuarial’s premiums can be helpful in a couple of ways. First, they can serve as a starting
point to identify the companies that have lower premiums. Then you can call two or three of
those companies for current quotes; second, CSG Actuarial also shows the insurance
companies’ financial ratings by A.M Best and Standard & Poor.

Discounts

Many insurance companies that sell Medigap policies offer discounts of various kinds. As an
example, some companies offer discounts for automatic debit payments of monthly premiums.
The UnitedHealthcare/AARP Medigap policies have an early enrollment discount that in your
case is 30% below the standard rate. This discount is calculated by multiplying 3% by the
number of years that someone is younger than 75. For someone who’s 65, the discount equals
10 years x 3%, or 30%. When you turn 66, the discount will be reduced to 27%, when you turn
67 they will be reduced to 24%, and so on.

The reason for pointing this out is that if you choose a UHC/AARP policy, you may have two
increases a year – one that’s 3% for the reduced discount (until you turn 75) and the other
that’s an increase for health care inflation. UHC/AARP policies can be solid choices if they are
attractively priced, but you should be aware that because of the reduced discount each year
until you are 75, your premiums may rise more quickly in a UHC/AARP policy than with many
other insurers. After you are 75, the UHC/AARP premiums should increase more slowly.

In addition to discounts, some insurers offer additional benefits like membership in Silver
Sneakers, which give you access to more than 12,000 gyms and health clubs nationally.
Appendix B1 lists the toll-free numbers of the companies that sell Medigap Plan F in Texas
(virtually all insurers sell Plan F).

Which of Your Doctors Accepts Medicare Assignment?

Six of your doctors accept Medicare but, as you indicated, Dr. Warmann does not. Of the six
doctors who accept Medicare, five are also listed as accepting Medicare assignment. I could not
find Dr. Martinez or the Austin Cancer Centers in Medicare’s online provider directory, and so
it’s not clear whether she accepts assignment.

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