Water damaged iPhone 5c and Applecare Plus?

I have (or had...) a 32gb iPhone 5c and accidentally dropped it in water and now it's not working so great. I have Applecare+, and haven't had to use it yet. Does anybody know if they're just able to replace certain parts on my phone and send my actual phone back to me, but refurbished? Since the 6 and 6 plus have come out, I notice they don't sell the 32gb 5c anymore, only 8gb. If they end up not being able to replace parts on my phone, what will happen? Will I get sent a 8gb 5c or have to pay some sort of upgrade fee for an iPhone 5s or iPhone 6? Has anybody experienced something like this?