Medigap plans, or Medicare Supplement, are private plans that complement Original Medicare. They help beneficiaries pay out-of-pocket costs in Original Medicare, such as deductibles and copayments.
Plan G and Plan N are two of the more popular Medigap options. As of 2021, 32% of people with Medigap were enrolled in Plan G, while 10% chose Plan N. One of the significant differences between them is that Plan G covers more costs than Plan N, though either plan could be a good fit, depending on your needs. Read on for details about how each plan works.
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How Medigap Works
Medicare Supplement plans help protect beneficiaries from high out-of-pocket medical costs. Some of the costs associated with Original Medicare include deductibles, coinsurance, and copayments.
There are 10 standardized Medigap plans for sale in most states, labeled with the letters A, B, C, D, F, G, K, L, M, and N. Every plan covers some or all of the following costs:
- Part A hospital coinsurance
- Additional 365 lifetime hospital days
- Part B coinsurance and copayments
- First three pints of blood, if you need a transfusion
- Part A hospice care coinsurance and copayments
Some plans offer coverage for additional benefits. Here’s a look at the extra benefits available from Medigap and which plans offer them:
- Skilled nursing facility coinsurance: Plans C, D, F, G, K, L, M, and N
- Part A deductible: Plans B, C, D, F, G, K, L, M, and N
- Part B deductible: Plans C and F
- Part B excess charges: Plans F and G
- Foreign emergency medical care: Plans C, D, F, G, M, and N
- Out-of-pocket spending limit: Plans K and L
Whichever plan you choose, it works the same way: You get care, and Original Medicare covers its share of the cost. Next, the Medigap plan pays its share of the remaining costs. Keep in mind that individuals newly eligible for Medicare can no longer purchase Medigap plans C and F.
Medigap Plan G vs. Plan N
Benefits | Plan G | Plan N |
|---|---|---|
Part A coinsurance and hospital costs for up to 365 additional days after Medicare benefits are disbursed | Yes | Yes |
Part B coinsurance or copayment | Yes | 100% coinsurance; but copays may still apply |
Part A hospice care coinsurance or copayment | Yes | Yes |
Part A deductible | Yes | Yes |
Part B deductible | Not covered | Not covered |
Part B excess charge | 100% | Not covered |
Out-of-pocket limit | N/A | N/A |
Blood (first three pints) | Yes | Yes |
Skilled nursing facility care coinsurance | Yes | Yes |
Foreign travel exchange (up to plan limits) | 80% | 80% |
Medicare Plan G and Medicare Plan N offer coverage for many of the same benefits, but there are key differences to be aware of. Plan G covers Part B excess charges, while Plan N does not. Both plans cover 100% of Part B costs, though Plan N sets copays for some office visits and emergency room visits.
Plan G Coverages
Plan G is the broadest coverage option available to new Medicare beneficiaries. It fully covers copayments and coinsurance for Part A and Part B services and adds some coverage for travel abroad. Unlike Plan N, it also covers Part B excess charges.
Excess charges occur when beneficiaries see a provider who does not agree to accept Medicare’s payment schedule. Providers may charge up to 15% more than the amount Medicare pays for a service and bill patients for the additional amount. Several states do not allow Part B excess charges.
Plan N Coverages
Plan N offers coverage similar to Plan G but does not cover Part B excess charges. Beneficiaries who see a provider who does not accept Medicare’s payment schedule may be responsible for paying excess charges out of pocket.
Plan N also fully covers coinsurance and copayments for Part B, with limited exceptions: It sets copays of up to $20 for office visits and up to $50 for emergency room visits.
Medigap Plan G vs. Plan N Costs
Medigap plans vary widely, but Plan G tends to cost more than Plan N. For both plans, factors that affect premium costs include your location, age, smoking status, and sex, along with how the insurance company prices its policies.
Medicare Plan G
Since it offers more benefits than Plan N, Plan G tends to have higher monthly premiums. Individual costs vary, but as an example, a 65-year-old non-smoker in California would pay around $135 to $255 per month for Plan G.
In some states, Plan G is available as a high-deductible plan. Beneficiaries who choose this option are responsible for paying $2,700 in out-of-pocket costs before their Medigap policy kicks in. However, premiums are low: Costs range from around $35 to $75 per month for a 65-year-old Californian.
Medicare Plan N
Plan N offers fewer benefits than Plan G. It does not cover Part B excess charges, and while it covers 100% of Part B services, it adds a small copayment for office visits and emergency room visits. For these reasons, premiums tend to be lower.
Unlike Plan G, there is no high-deductible option for Plan N. Premium costs vary, but for a 65-year-old non-smoker in California, available plans charge around $105 to $185 per month.
Medigap Plan G vs. Plan N Pros and Cons
When deciding between Medicare Supplement Plan N vs. Plan G, carefully consider the advantages and drawbacks of each policy. Here’s a look at the main pros and cons.
Plan G
Medicare Plan G offers advantages over Plan N and other Medigap options, including greater coverage of out-of-pocket costs. However, it also has some disadvantages, such as high premiums.
- Covers nearly all out-of-pocket Medicare costs
- Provides predictable healthcare costs
- Offers a high deductible option
- High monthly premiums
- May produce initial high out-of-pocket costs with high deductible model
- Does not cover Part B deductible
Pros
- Covers nearly all out-of-pocket Medicare costs: Plan G covers coinsurance and copayments for Part A and Part B, as well as the Part A deductible. It does not cover the Part B deductible, which is $226 in 2023.
- Provides predictable healthcare costs: Beneficiaries pay stable monthly payments throughout the year rather than unpredictable copayments and coinsurance.
- Offers a high-deductible option: Beneficiaries who choose this option benefit from lower monthly premiums.
Cons
- High monthly premiums: Plan G is typically more expensive than Plan N and the other Medigap plans available to new Medicare beneficiaries.
- Potential for high out-of-pocket costs: Beneficiaries who choose a high-deductible Plan G policy pay the first $2,700 in out-of-pocket costs on their own.
- Does not cover the Part B deductible: Only Plan C and Plan F cover the Part B deductible. They’re unavailable to people eligible for Medicare on or after Jan. 1, 2020.
Plan N
Medicare Plan N offers advantages compared to Plan G, such as its lower premiums and advantages compared to other Medigap options. However, there are also some drawbacks to Plan N.
- Lower premiums than Plan G
- Covers more costs than other plans
- Includes foreign emergency benefits
- Does not cover Part B excess charges
- Includes copays for some services
- Does not cover the Part B deductible
Pros
- Lower premiums than Plan G: Plan N tends to have lower premiums than Plan G, though it covers many of the same benefits.
- Covers more costs than other plans: While Plan N covers fewer benefits than Plan G, it offers more coverage than Plans A, B, K, L, and M.
- Includes foreign emergency benefits: Plan N is one of the 6 Medigap plans that offer coverage for foreign travel emergencies.
Cons
- Does not cover Part B excess charges: Beneficiaries who see a doctor who does not accept Medicare’s payment schedule may face unexpected charges.
- Includes copays for some services: Plan N features copays of up to $20 for office visits and up to $50 for emergency room visits, which may not appeal to those who need care frequently.
- Does not cover the Part B deductible: Like Plan G, Plan N does not cover the Part B deductible.
Which Should You Choose: Medigap Plan G or Plan N?
Both Plan G and Plan N are popular plans, but depending on your needs, one might be more suitable than the other. Consider your healthcare needs, budget, and preferences to make a decision.
Consider Plan G If…
- You’re comfortable paying higher monthly premiums in exchange for more coverage.
- You want stable, predictable healthcare costs throughout the year.
- You live in a state that allows Part B excess charges and worry about paying these extra fees.
- You get care frequently and do not want to pay copays for every office or emergency room visit.
- You want a high-deductible Medigap plan that’s available to new beneficiaries.
Consider Plan N If…
- You cannot afford Plan G’s higher monthly premiums but want a plan that covers most of the same benefits.
- Your state does not allow Part B excess charges, so you are not worried about surprise bills when you get care.
- You get care infrequently and do not mind paying copays for occasional office or emergency room visits.
- You do not want a high-deductible Medigap plan.
Medigap Plans G and N vs. Other Medigap Options
Before choosing a policy, consider looking into other plans that provide similar coverage.
Plan F is the most similar option to Plan G. It covers the same services as Plan G and offers a high-deductible option. However, it also covers the Part B deductible. Unfortunately, Plan F is only available to beneficiaries eligible for Medicare before Jan. 1, 2020.
Plan D offers similar coverage to Plan N. However, it covers 100% of Part B costs without adding a copay for office visits or emergency room visits. Plan D could be a good option for beneficiaries who like Plan N but do not want extra copays.
How to Enroll in Medigap Plan G or N
Medicare beneficiaries can make coverage changes at certain times of the year, known as enrollment periods. Medigap is separate from Medicare and has its own enrollment period: The Medigap Open Enrollment Period (OEP).
The Medigap OEP is a one-time, 6-month period that starts the first day of the month when you’re 65 or older and enrolled in Medicare Part B. You can now buy any Medigap policy for sale in your state, even if you have health issues.
Insurers sell Medigap plans year-round. However, outside of the Medigap OEP, insurance companies are generally allowed to use medical underwriting to decide whether or not to accept an application. If you can buy a policy, it might cost more.
Some states offer additional consumer protections. For example, a few states, including New York and Connecticut, have continuous open enrollment for Medigap. Other states, including California and Oregon, provide annual open enrollment periods. Contact your state department of insurance for more information.
Take Advantage of the Medigap Free Look Period
The Medigap free look period is a 30-day window that starts when a beneficiary enrolls in a new Medigap policy. Beneficiaries who are unsatisfied with their policy can return it for a full refund within the first 30 days.
Beneficiaries can use the free look period to try out a second policy during their Medigap OEP. Do not cancel the first policy until you’ve decided whether or not you want to keep the second policy.
What It All Means For You
Medicare beneficiaries can choose between 10 standardized Medigap policies in most states, and Plan G and Plan N are two of the more popular options. Both plans provide similar coverage, though Plan N typically has lower premiums and does not cover Part B excess charges.
Consider your health needs and budget to choose between Plan G vs. Plan N or another Medigap option. For help making an informed decision, consult with a trusted agent.