New beneficiaries shopping for coverage after enrolling in Medicare Part A and Part B have many questions.
Here is one that I get frequently.
What is the difference between a Medicare supplement Plan G and Plan N? My agent says I can save money on premiums but I need to know the rest of the story.
A Medicare supplement plan, commonly known as a Medigap policy, helps to cover the costs that Part A and Part B do not pay, like the inpatient hospital deductible and the Part B deductible and coinsurance. These policies can also offer optional benefits related to things that Medicare doesn’t cover, like foreign travel emergency.
In 1992, the Health Care Financing Administration (the Centers for Medicare and Medicaid predecessor) standardized the policies into lettered plans. Over the years, letters have come and gone and, today, there are 10 lettered plans, A, B, C, D, F, G, K, L, M, and N. This system applies in 47 states with Massachusetts, Minnesota and Wisconsin having their own standardization models.
The 10 benefits in Medigap plans help with cost sharing for:
- The Part A hospitalization deductible and additional days, skilled nursing facility stays, and hospice care
- The Part B deductible, coinsurance and excess charges
- First three pints of blood, and
- Foreign travel emergency.
Each letter represents a different package of benefits and cost sharing. Pay the monthly premium and face predictable out-of-pocket costs — what budget-conscious people prefer.
Plan G is now the most popular plan with almost 40% of enrollees. That’s because it covers nine of the 10 benefits. After meeting the Part B deductible ($257 in 2025), there are no additional out-of-pocket costs for any medical care from providers who accept Medicare assignment for the remainder of the calendar year.
Plan N has about 10% of enrollees. Here are the important points.
- It does not cover the Part B deductible, just like Plan G.
- There is a $20 copayment for some office visits.
- There is also a $50 copayment for emergency room visits that do not result in hospitalization.
- Plan N does not cover Part B excess charges, which apply to non-participating providers. They are enrolled in Medicare but choose to receive payment in a different method and amount than participating providers. These are usually specialists, like those at the Mayo Clinic, who can charge up to 15% more. Plans in seven states cannot apply these charges and New York limits the charge to 5%.
There is one more difference between Plan G and Plan N: the monthly premium. Because Plan N does not cover as much as Plan G, the premiums are lower. How much lower depends on where you live. I have seen a range from $30 to $80 less per month than Plan G policies.
Minnesota and Wisconsin have plans that charge copays, comparable to Plan N, and premiums can be lower. However, I have not seen a similar plan in Massachusetts.
Before You Make A Decision
- If being able to see specialty providers is a concern for you and providers in your state can apply excess charges, Plan N may not be best choice.
- Think about your physician visits. How many do you make in a month? If, for example, the monthly premium for Plan N is $30 less and you see one physician a month, it might not be worth giving up the excess charges coverage.
- Realize that your ability to change Medigap policies may depend on your health and where you live so choose carefully.
Having many Medicare options can lead to many questions. Take time to study your situation and look closely for your answers.
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