Page 1 - Cover Letter and Evaluation for Anne Parlin

October 13, 2017

Mrs. Anne Parlin
8516 River Rock Terrace
Bethesda, MD 20817

Dear Mrs. Parlin:

Attached is the comparison of your Medicare-related costs in New York and Vermont. In most
cases, the costs shown are for the 2018 plan year. Medicare, though, has not yet released its
2018 cost information – Part B premiums, Part A and Part B deductibles, etc. -- and so
Medicare’s 2017 costs are used.

Medigap costs and coverage rules

Your Medigap premiums will be about 25% or 30% higher in New York than in Vermont. In
either state, though, your current Medigap policy is good, as explained in Medicare’s rules on
the inside front cover of your comparisons. If you keep your policy with your current insurance
company after you move, your premiums will be adjusted to be consistent with your new
state’s Medicare costs and its requirements for setting premiums.

Both New York and Vermont require insurance companies to use a community rating in
determining Medigap premiums. In a community rated policy, everyone in a particular county
pays the same premium regardless of age, gender, and health status. Costs can vary by county,
however, since some counties have higher average Medicare costs than others. So, you and
your husband will pay the same Medigap premiums, assuming you get the same Medigap plan
from the same insurance company. Only eight states require insurers to use community ratings
(although the UnitedHealthcare/AARP Medigap policies use a modified community rating in
other states).

New York also has a law that Vermont does not have – it requires companies to sell Medigap
policies at any time during the year, or year-round guaranteed issue. This law encourages some
people to wait until they experience health problems to buy a Medigap policy. And that drives
up premiums, which is the main reason that premiums are higher in New York.

In Vermont, on the other hand, if you want to switch insurers after you have had Medicare A
and B for more than six months, you will be asked questions about your health before you are
given a quote, and in some cases you could be denied coverage if you have a serious pre-
existing condition.