Choosing a Medigap plan can feel like you’ve been handed a complex puzzle with no picture on the box. You know Original Medicare is a great start, but it doesn’t cover everything, leaving you responsible for deductibles and coinsurance. That’s where Medigap comes in, filling those financial gaps and giving you peace of mind. While there are ten different options, the conversation for most new Medicare members quickly narrows to two top contenders: Plan G and Plan N. This guide is designed to be your clear, straightforward comparison of these two excellent choices, helping you cut through the confusion and confidently identify the best medigap plans for your health needs and budget.
Key Takeaways
- Decide on Your Financial Comfort Zone: Plan G offers maximum coverage for a higher monthly premium, meaning fewer surprise bills. Plan N lowers your monthly payment but requires you to handle small, predictable copays for doctor visits.
- Shop Around for the Best Price: Since Medigap plans are standardized, a Plan G is a Plan G everywhere. The main difference is the price, so comparing quotes from different insurance companies is the best way to save money on your monthly premium.
- Choose for the Long Haul: Your first Medigap choice is critical, as switching plans later may be difficult. Select a plan based not just on your current health, but on the financial security you want for years to come.
What Are Medigap Plans?
Think of Original Medicare (Parts A and B) as your foundational health coverage. It’s a fantastic starting point, but it doesn’t cover everything. You’re still responsible for certain costs like deductibles, copayments, and coinsurance. This is where Medigap plans, also known as Medicare Supplement Insurance, come into the picture. These plans are offered by private insurance companies and are designed to work with Original Medicare to help pay for some of those remaining costs.
The reason these plans exist is because Original Medicare has “gaps” in its coverage. For example, after you’ve met your annual deductible, Medicare Part B generally only covers 80% of the cost for most doctor services and outpatient care. You are responsible for the remaining 20%, which can add up quickly, especially if you need frequent medical care. A Medigap plan can help cover that 20% coinsurance, giving you more predictable healthcare expenses.
To make comparing plans easier, the government standardized them. There are 10 standardized Medigap plans available in most states, each identified by a letter (A, B, C, D, F, G, K, L, M, and N). This means that a Plan G from one insurance company must offer the same basic benefits as a Plan G from any other company. The main differences you’ll find are the monthly premium and the quality of the company’s customer service. This standardization allows you to shop for the best price without worrying that you’re getting lesser coverage. Ultimately, the goal of a Medigap plan is to help pay out-of-pocket costs and provide you with financial peace of mind.
Why You Might Need a Medigap Plan
If you’re enrolled in Original Medicare, you have solid hospital and medical coverage. But it’s important to know that Original Medicare doesn’t cover everything. It leaves behind certain “gaps” that you are responsible for paying, like deductibles, copayments, and coinsurance. This is where a Medigap plan, also known as Medicare Supplement Insurance, can be a lifesaver. These plans are offered by private insurance companies and are specifically designed to help pay for those remaining costs.
Think about it this way: Medicare Part B typically covers 80% of your outpatient medical expenses after you’ve met your deductible. That means you’re on the hook for the other 20%, and there’s no annual cap on how high that amount can go. If you have a chronic condition or need frequent medical care, that 20% can add up to a significant financial burden over the year. A Medigap plan can cover some or all of that remaining share, protecting your budget from unpredictable medical bills. This is especially crucial for anyone who anticipates needing ongoing treatment, as these out-of-pocket costs can be substantial.
Beyond the practical financial help, a Medigap plan provides invaluable peace of mind. Worrying about how you’ll afford care during a health crisis is the last thing you need. For instance, while Medicare Part A covers hospital stays, its coverage has limits, and a prolonged stay could result in large bills. Having a Medigap plan means you have a predictable, manageable way to handle these costs, allowing you to focus on what matters most—your health. Because everyone’s needs and budget are unique, it’s wise to compare different Medigap options to find the one that best fits your personal situation.
A Quick Look at Your Medigap Plan Options
When you start looking at Medigap, you’ll see plans labeled with letters, like Plan G or Plan N. These plans are standardized by the government, which is great news for you. It means that a Plan G from one company has the exact same basic benefits as a Plan G from another. The main difference you’ll find is the price, or the monthly premium, that each insurance company charges.
While there are 10 different Medigap plans available, most people find that just a few of them offer the right mix of coverage and value. The two most popular choices for new Medicare members are Plan G and Plan N. They’ve become the go-to options because they provide substantial coverage without the highest possible price tag.
You might have heard friends or family talk about Plan F, which was once the most comprehensive plan. However, Plan F is no longer available to anyone who became eligible for Medicare on or after January 1, 2020. Because of this change, Plan G has stepped into the spotlight as the most extensive coverage you can get as a new enrollee. Understanding the differences between these top plans is the first step toward finding the one that fits your life and budget.
Plan G: The Popular Choice
Think of Plan G as the new heavyweight champion of Medigap. For anyone new to Medicare, it offers the most coverage you can buy. It covers nearly all of your out-of-pocket costs that Original Medicare leaves behind, including copayments and coinsurance. The only thing you’re responsible for is the annual Medicare Part B deductible. Once you’ve paid that for the year, Plan G takes care of the rest for Medicare-approved services.
A key feature of Plan G is that it covers Part B excess charges. These are extra fees that some doctors can charge above the Medicare-approved amount. While not all doctors apply these charges, having them covered gives you an extra layer of financial protection. Because of its comprehensive nature, Medicare Supplement Plan G typically comes with a higher monthly premium, but for many, the peace of mind is well worth it.
Plan N: The Cost-Effective Alternative
If you like the idea of strong coverage but want a lower monthly premium, Plan N is an excellent alternative. It provides much of the same protection as Plan G but asks you to share a small portion of the costs. In exchange for that lower premium, you’ll pay a copayment of up to $20 for some doctor’s office visits and a $50 copay for emergency room visits (which is waived if you’re admitted to the hospital).
The main difference between Plan N vs. Plan G is that Plan N does not cover Part B excess charges. This means if your doctor charges more than the Medicare-approved amount, you would be responsible for that difference. For individuals who don’t visit the doctor often and are comfortable with small, predictable copays, Plan N can be a smart way to save money each month without sacrificing major medical coverage.
Other Plans to Know
While G and N get most of the attention, it’s helpful to know a few other options exist. Plans K and L are designed with more cost-sharing. They have lower monthly premiums, but you pay a percentage of your medical costs until you reach a set out-of-pocket maximum for the year. Once you hit that limit, the plan covers 100% of your approved services for the rest of the year.
On the other end of the spectrum, Plans A and B offer more basic benefits and generally leave you with higher out-of-pocket expenses. And as mentioned, Plan F is still available for those who were eligible for Medicare before 2020. Knowing about the full range of the best Medigap plans can help you feel confident that you’re making a well-rounded decision.
Plan G vs. Plan N: A Side-by-Side Comparison
When you start looking at Medigap plans, you’ll quickly notice that Plan G and Plan N are two of the most popular options for new Medicare members. Both offer fantastic coverage, but they work a little differently. Think of it like choosing between a car with all the bells and whistles and one that’s just as reliable but has a few fewer features to keep the price down. Let’s break down the key differences so you can see which one aligns better with your needs and budget.
What Each Plan Covers
Both Plan G and Plan N are designed to cover the “gaps” in Original Medicare, but they don’t cover the exact same things. Plan G is the most comprehensive plan available to new beneficiaries. Once you meet your annual Part B deductible, Plan G covers nearly all of your remaining out-of-pocket costs, including coinsurance and copayments. It’s a popular choice for people who want predictable healthcare expenses and minimal bills after receiving care.
Plan N also provides excellent coverage but asks you to share some of the costs. In exchange for a lower monthly premium, you agree to pay small copayments for certain services. It covers your Part A and B coinsurance but leaves you with a few predictable costs, which we’ll get into next.
Comparing Monthly Premiums
The monthly premium is often the first thing people look at, and it’s one of the biggest differences between these two plans. Because it offers more first-dollar coverage, Plan G generally has a higher monthly premium than Plan N. You’re paying a bit more each month for the peace of mind that comes with having fewer out-of-pocket expenses when you need care.
On the other hand, Plan N was designed to be a more budget-friendly option. Its lower monthly premium is its main attraction. If you’re looking to keep your fixed monthly costs down and are comfortable paying for some services as you use them, the savings from Plan N’s premium can really add up over the year.
Potential Out-of-Pocket Costs
This is where the trade-off for Plan N’s lower premium becomes clear. With Plan N, after you’ve met your annual Part B deductible, you will have a copayment of up to $20 for some doctor’s office visits and a $50 copay for emergency room visits. It’s important to know the ER copay is waived if you’re admitted to the hospital. These costs are predictable and relatively small, but they are something to factor into your budget.
With Plan G, you don’t have these copayments. Once your Part B deductible is paid for the year, your plan covers these costs completely. This is the primary reason for its higher premium—it offers more complete coverage at the point of service.
A Note on Part B Excess Charges
Here’s a detail that can be a deciding factor for some. A Part B excess charge is an extra amount, up to 15%, that a doctor can legally charge you above the Medicare-approved amount for a service. It’s important to know that these charges are not very common, as most doctors in the country accept Medicare assignment, meaning they agree to take the Medicare-approved amount as full payment.
However, if you see a doctor who doesn’t accept assignment, the difference in coverage matters. Plan G covers Part B excess charges, so you’d never have to worry about them. Plan N does not cover these charges, meaning you would be responsible for paying them yourself if they occurred.
Which Plan Fits Your Lifestyle?
Choosing between Plan G and Plan N comes down to your personal preferences, health, and budget. If you value predictability and want to minimize out-of-pocket costs when you visit the doctor, Plan G is an excellent choice. You’ll pay a higher premium, but you’ll have very few other costs for Medicare-covered services.
If you are in good health, don’t anticipate frequent doctor visits, and want to save money on your monthly premiums, Plan N could be a great fit. The potential copayments might be a small price to pay for the significant monthly savings. It’s a matter of weighing the lower premium against the possibility of small, predictable out-of-pocket costs.
How to Think About Medigap Costs
When you start looking at Medigap plans, the price tag is often the first thing you notice. But the monthly premium is only one part of the story. Understanding what goes into that number and how it relates to your total healthcare spending is key to making a smart decision. It’s not just about finding the cheapest plan today, but about finding the one that offers financial predictability and peace of mind for the years ahead. Let’s break down how to think about these costs so you can feel confident in your choice.
What Influences Your Plan’s Cost?
You might notice that the monthly premium for the exact same Medigap plan can vary quite a bit. That’s because several personal factors influence your rate. Insurance companies look at your age, where you live, and whether you use tobacco. For example, living in a state with a higher cost of living or more expensive healthcare services can result in a higher premium. Your age when you first enroll also plays a significant role in setting your initial price. Because these factors can lead to substantial differences in what you pay, it’s important to compare Medigap plans carefully to see what rates you qualify for based on your personal situation.
Thinking About Costs Down the Road
It’s helpful to think of Medigap costs as a balancing act between your monthly premium and your potential out-of-pocket expenses. A plan with a higher monthly premium, like Plan G, often comes with lower or no costs when you see a doctor or visit a hospital. On the other hand, a plan with a lower premium, like Plan N, might require you to pay a small copay for certain services. When you evaluate your healthcare needs, consider your health history and how often you anticipate needing medical care. This will help you decide which approach is more cost-effective for you in the long run—paying more each month for predictability or paying less upfront with some variable costs.
What to Expect for Plan G and N Premiums
When you compare Plan G and Plan N, you’ll see a clear difference in their premium structures. Plan G is known for its comprehensive coverage, which means it typically has a higher monthly premium. In return, it covers nearly all of your out-of-pocket costs after you’ve met your Part B deductible. Plan N usually has a more moderate premium, making it an attractive option if you want to keep your fixed monthly expenses lower. However, with Plan N, you should be prepared for some additional costs, like a copay of up to $20 for doctor visits and a $50 copay for ER visits that don’t result in hospital admission. The choice really comes down to your budget and comfort with these potential out-of-pocket payments.
How to Choose the Right Medigap Plan
Picking the right Medigap plan feels like a huge decision, because it is. But it doesn’t have to be overwhelming. The best plan for you comes down to a few key factors: your health, your budget, and how you feel about handling potential costs down the road. By thinking through these areas, you can find a plan that gives you security and peace of mind. Let’s walk through the four main questions to ask yourself.
Review Your Healthcare Needs
First, take an honest look at your health. This is the foundation for your decision. Think about how often you currently visit the doctor or specialists. Do you have any chronic conditions that require regular care? While no one has a crystal ball, you should “consider your current health, [and] potential future needs,” as you choose your coverage. If you see doctors frequently or manage an ongoing health issue, a plan with more comprehensive coverage, like Plan G, might be a better fit. This initial step helps you match a plan’s benefits to your real-world health situation.
Look at Your Budget
Next, it’s time to think about your finances. Your monthly premium is a fixed cost, but you also need to account for potential out-of-pocket expenses like deductibles and copayments. It’s a balancing act. For example, “Plan G may have higher monthly premiums compared to other plans like Plan N,” but it covers more, leaving you with fewer surprise bills. On the other hand, “Plan N generally has lower monthly premiums,” which can be great for your monthly budget, but you’ll be responsible for small copays for doctor and ER visits. Think about what you’re more comfortable with: a higher predictable monthly bill or a lower one with some variable costs.
Plan for Your Future Health
While your current health is a great starting point, it’s wise to plan for the future, too. Your health needs can change over time, and it’s not always easy to switch Medigap plans later on. Outside of your initial enrollment period, insurance companies can use medical underwriting to decide whether to cover you and how much to charge. This makes your first choice incredibly important. You should “carefully consider your healthcare usage, budget, and risk tolerance when choosing a plan” to ensure it serves you well for years to come. A plan that feels right today should also feel right if your health needs change tomorrow.
Decide on Your Comfort with Risk
Ultimately, this choice comes down to your personal comfort with financial risk. Are you someone who sleeps better at night knowing that nearly all of your medical costs are covered after you meet your deductible? If so, Plan G’s comprehensive coverage is likely your best bet. Or, are you generally healthy and prefer to pay lower monthly premiums, even if it means handling some out-of-pocket costs yourself? If you “don’t anticipate frequent doctor visits or emergency room trips, Plan N could be a cost-effective option.” There’s no right or wrong answer—only the one that aligns with your personal and financial preferences.
Clearing Up Common Medigap Myths
When you’re trying to figure out Medigap, it feels like everyone has an opinion. Friends, neighbors, and articles you find online might offer advice, but sometimes that information is outdated or just plain wrong. It’s easy to get tripped up by hearsay. Let’s walk through some of the most common myths about Medigap plans so you can separate fact from fiction and make a choice that feels right for you.
Myth: “All Medigap plans are identical.”
This is a common point of confusion, and it’s easy to see why. The truth is a little more nuanced. While Medigap plans are standardized by the government, they aren’t all the same. There are 10 distinct plans, labeled with letters like G and N, each offering different levels of coverage. The key thing to remember is that a Plan G from one company must offer the exact same benefits as a Plan G from another. What isn’t identical is the price. Insurance companies can charge very different monthly premiums for the same lettered plan, which is why it’s so important to compare your options carefully.
Myth: “Plan F is still the best option.”
You may hear friends or family who have been on Medicare for a while talk about how great Plan F is. And they’re not wrong—it was famous for its comprehensive coverage. However, a federal law changed things for new enrollees. If you became eligible for Medicare on or after January 1, 2020, you can no longer purchase Plan F. For anyone new to Medicare, Plan G is now the go-to choice and a strong alternative that offers nearly identical coverage. The only significant difference is that you have to pay your annual Part B deductible yourself with Plan G.
Myth: “Plan G has no out-of-pocket costs.”
Plan G is incredibly popular because it covers so many of the gaps in Original Medicare, but it doesn’t eliminate all costs. With Plan G, your main out-of-pocket expense will be the annual Part B deductible. This is the amount you pay for doctor visits and other outpatient services before Medicare and your Medigap plan start paying their share. For many people, this is a predictable and manageable expense. Once you’ve met that deductible for the year, Plan G picks up the rest of the approved costs, including things like Part B excess charges, which can be a relief for your budget.
Myth: “Plan N covers everything except a small copay.”
Plan N is an attractive option because its monthly premiums are often lower than Plan G’s. While it’s true that you’ll have small copayments—up to $20 for some doctor’s office visits and $50 for an ER visit—that isn’t the whole story. The most important detail to understand about Plan N is that it does not cover Part B excess charges. These are extra fees that some doctors are legally allowed to charge above the Medicare-approved amount. While not all doctors bill for them, if you see one who does, you’ll be responsible for paying that difference out of pocket. This is a key trade-off for the lower premium.
How to Find the Best Rate for Your Plan
Once you have a good idea of whether Plan G or Plan N is a better fit for you, the next step is to find the best price. Since private insurance companies sell Medigap plans, the premiums for the exact same plan can be different from one company to the next. Think of it like buying a car—the same make and model can have different price tags at different dealerships. Your job is to find the one that offers the coverage you need at a price that works for your budget.
Finding the right rate involves a little bit of research, but it’s well worth the effort. By comparing your options, understanding what goes into the price, and asking the right questions, you can feel confident that you’re not overpaying for your coverage. Let’s walk through a few simple steps to help you secure a great rate for your Medigap plan.
Compare Quotes from Different Companies
You wouldn’t buy the first house you see, and the same principle applies here. Because prices and plans vary between companies, it’s essential to get multiple quotes. This allows you to compare not just the monthly premium but also the company’s reputation for customer service and rate stability. An independent insurance agent can be a huge help here, as they can pull quotes from several different carriers for you all at once. This saves you the time and hassle of calling each company individually and gives you a clear, side-by-side look at your options.
Understand How Plans Are Priced
Monthly premiums for Medigap plans can change quite a bit based on your age, where you live, and whether you use tobacco. For instance, the cost for a Medigap Plan G in one city might be very different from the cost in another, even for the same person. Insurance companies use one of three pricing methods: community-rated, issue-age-rated, or attained-age-rated. Understanding which method a company uses is key, as it affects how your premium might change over time. Attained-age-rated plans, for example, often start with lower premiums that increase as you get older.
Ask About Available Discounts
Don’t be shy about asking for a discount—you might be surprised by what’s available. Many insurance companies offer discounts that can help lower your premiums. A common one is a household discount, which you might get if you and your spouse are both enrolled in plans from the same company. Some insurers also offer discounts for setting up automatic payments from your bank account or for being a non-smoker. When you’re comparing plans, always make it a point to ask the agent or company representative about any discounts you might qualify for.
Who Offers Medigap Plans?
Once you’ve decided on a Medigap plan letter, like G or N, your next step is to choose an insurance company. This is a crucial step because while the government standardizes the benefits for each plan letter, the companies that offer them are all different. Medigap plans are sold by private insurance companies, not by Medicare itself. This means that a Plan G from one company has the exact same basic medical benefits as a Plan G from another company.
So, what’s the difference? The price. Monthly premiums for the same exact plan can vary significantly from one company to the next. Beyond cost, companies also differ in their customer service, financial stability, and how they price their plans over time. Some companies are known for low introductory rates that increase sharply later, while others have more stable pricing. That’s why it’s so important to compare your options carefully. You’re not just picking a plan; you’re choosing a company to partner with for your healthcare coverage for years to come.
The Big 65
Think of us at The Big 65 as your expert guide rather than an insurance company. We don’t offer Medigap plans ourselves. Instead, we are an independent agency that helps you sort through all the options from the major insurance carriers in your state. Our job is to make this process easier for you. We provide the tools and one-on-one guidance to help you understand the fine print, compare costs, and find the best plan and company for your specific needs and budget. We do the heavy lifting of researching and comparing so you can feel confident in your choice.
Aetna
Aetna is a well-known name in the insurance world, and they are a major player in the Medigap market. They offer a solid range of plans, including the popular Plan G and Plan N. Many people are drawn to Aetna because of their competitive pricing and strong reputation for customer service. When you’re dealing with medical bills and claims, having a company that is responsive and helpful can make a huge difference. If a good balance of reasonable cost and reliable support is important to you, Aetna is definitely a company to have on your comparison list.
Cigna
If you’re focused on finding the lowest possible premium, Cigna might catch your eye. They are often recognized for having some of the most competitive rates, especially for Plan N. However, it’s important to look at the full picture. According to some industry reviews, Cigna has a higher-than-average number of complaints compared to its size. This doesn’t mean you’ll have a bad experience, but it’s a factor to consider. For some, the potential monthly savings is worth it, while others may prefer to pay a bit more for a company with a stronger customer service record.
Mutual of Omaha
Mutual of Omaha is another long-standing, reputable company that many people trust for their Medigap coverage. One of their standout features is the potential for discounts. They often offer a significant household discount if you and your spouse both enroll in a plan, which can lead to substantial savings over time. They provide the most popular plans, like G and N, though their overall selection might be smaller than some competitors. If you’re eligible for a household discount, it’s absolutely worth getting a quote from Mutual of Omaha to see how it stacks up.
AARP/UnitedHealthcare
You’ll almost always see AARP and UnitedHealthcare mentioned together. UnitedHealthcare is the insurer for the AARP-branded Medicare plans. Their biggest strength is the extensive range of Medigap plans they offer, which are available in all 50 states. This wide availability and variety of choices can be a huge plus. However, for some people, having so many options can feel a little overwhelming. The AARP endorsement is a big draw for many, and their nationwide presence makes them a reliable choice no matter where you live.
Blue Cross Blue Shield
Blue Cross Blue Shield (BCBS) is a bit unique. It’s not a single national company but a federation of 34 independent, locally operated companies. This means that the BCBS in your state is different from the one in the next state over. Because of this structure, the plan offerings, pricing, and customer service can vary quite a bit depending on where you live. They are generally a well-regarded option with strong local networks, but you’ll need to research your specific state’s BCBS provider to get an accurate picture of what they offer.
Humana
Humana is another one of the largest and most recognized providers of Medigap plans. They offer several options, including the highly sought-after Plan G and Plan N. Humana is often noted for its focus on customer support and providing helpful resources to its members. Like some other large carriers, their pricing and plan availability can sometimes differ by state, so it’s important to get a quote specific to your area. If you value strong customer service and want a plan from a stable, well-known company, Humana is a solid contender to include in your comparisons.
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Frequently Asked Questions
What’s the real difference between Plan G and Plan N in simple terms? Think of it as a trade-off between your monthly bill and what you pay when you see a doctor. With Plan G, you pay a higher monthly premium, but once your annual Part B deductible is met, your medical costs are almost entirely covered. Plan N offers a lower monthly premium, but in exchange, you agree to pay small, predictable copayments for some doctor and ER visits. The other key difference is that Plan G covers Part B excess charges, while Plan N does not.
If all plans with the same letter are identical, should I just pick the cheapest company? While it’s tempting to just go for the lowest price, the company you choose really does matter. The benefits of a Plan G are the same everywhere, but the company’s history of rate increases and its customer service are not. Some companies might offer a low introductory rate that climbs steeply over the years. Choosing a stable, reputable company can save you money and headaches in the long run.
I keep hearing about Plan F. Why isn’t it a main option anymore? You’re right, Plan F was once the most popular plan because it covered everything. However, a federal law changed the rules for anyone who became eligible for Medicare on or after January 1, 2020, making Plan F unavailable to them. For new Medicare members, Plan G has effectively taken its place as the most comprehensive option available. It offers the same robust coverage as Plan F, with the single exception that you pay the annual Part B deductible yourself.
Can I switch my Medigap plan easily if my health changes later on? Switching plans isn’t always a simple process. When you first enroll in Medicare, you have a special open enrollment period where you can buy any Medigap plan without answering health questions. Outside of that window, insurance companies can generally require medical underwriting. This means they can review your health history and potentially charge you a higher premium or even deny coverage. This is why it’s so important to choose a plan that you feel will serve you well for years to come.
Do these Medigap plans help pay for my prescription medications? This is a fantastic question and a common point of confusion. Medigap plans are designed to help cover the costs associated with Original Medicare Parts A and B, which are your hospital and medical insurance. They do not include coverage for prescription drugs. For that, you will need to enroll in a separate Medicare Part D prescription drug plan.