Medicare Supplement insurance, also called Medigap, can help pay some of the out-of-pocket costs left behind by Original Medicare. If you are new to Medicare, the letter names on these plans can feel confusing. You may see Plan G, Plan N, Plan K, and other letters and wonder what they mean.
The good news is that Medicare Supplement plans are generally easier to compare than they first appear. The letters identify a set of benefits. In most states, a Plan G from one insurance company has the same basic Medicare-covered benefits as a Plan G from another company. The premium, customer service, rate history, and extra features may be different.
This guide explains the main Medicare Supplement plan letters and how to start narrowing down your choices.
What are Medicare Supplement plan letters?
Medicare Supplement plans work alongside Original Medicare, which includes Part A for hospital care and Part B for medical care. Original Medicare pays its share of approved costs first. Your Medicare Supplement policy may then help pay certain remaining costs, such as deductibles, copayments, and coinsurance.
Plans are identified by letters, including A, B, D, G, K, L, M, and N. Each letter represents a different package of benefits. A Plan G is not better simply because it has a later letter than Plan A. The letters are just names for standardized benefit packages.
In most states, the benefits for each letter plan are standardized. This means a Plan N generally offers the same core benefits regardless of which carrier sells it. Massachusetts, Minnesota, and Wisconsin use different standardization rules, so plan choices work somewhat differently in those states.
Which Medicare Supplement plans are available?
Not every insurance company offers every plan letter. Also, availability may vary by state. Here is a plain-English look at the plans you are most likely to encounter.
- Plan A: This is the basic standardized Medicare Supplement plan. It covers several core expenses, including Part A coinsurance and hospital costs after Medicare benefits are used. It does not cover every gap in Original Medicare.
- Plan G: Plan G is a common choice for people new to Medicare. It generally covers many major gaps in Original Medicare, including Part B excess charges in states where those charges are allowed. You still pay the annual Part B deductible yourself.
- Plan N: Plan N may have a lower premium than Plan G in some areas, but it asks you to share more costs when you receive certain services. It can include copayments for some office and emergency room visits, and it does not cover Part B excess charges.
- Plans K and L: These plans generally have lower premiums in exchange for more cost-sharing. They pay a percentage of certain covered costs until you reach the plan's annual out-of-pocket limit. The limits and benefits can change from year to year.
- Plan M: Plan M shares the Part A deductible with you and may be worth considering for someone comfortable paying more when a hospital stay occurs.
- Plans B and D: These plans may be available in some areas, although they are less commonly selected by new Medicare beneficiaries than Plan G or Plan N.
Plans C and F are generally not available to people who first became eligible for Medicare on or after January 1, 2020. People who were eligible before that date may still be able to buy them if they are available and they qualify under the carrier's rules.
What do Medigap plans usually help pay?
Depending on the letter plan you choose, a Medicare Supplement policy may help with costs such as:
- Part A hospital coinsurance and additional hospital days after Medicare benefits are exhausted
- Part B coinsurance or copayments for doctor visits and outpatient care
- The Part A hospital deductible
- Skilled nursing facility coinsurance
- Blood costs for the first few pints when needed
- Part B excess charges, with certain plans
- Emergency care during foreign travel, up to plan limits
Medigap policies are designed to help with Medicare-approved services. They do not replace Original Medicare. You still need to pay your Part B premium, and you will pay a separate premium for the Medicare Supplement policy.
What does a Medicare Supplement plan not cover?
Medicare Supplement insurance does not generally cover everything. For example, new Medigap policies do not include prescription drug coverage. If you want help paying for retail prescription drugs, you may consider a separate Medicare Part D prescription drug plan.
Medigap also does not generally cover routine dental care, routine vision care, hearing aids, long-term custodial care, or private-duty nursing. Some carriers may offer separate optional products or discounts, but these are not standard Medigap benefits and may vary.
How do Plan G and Plan N differ?
Plan G and Plan N are often the two letter plans that new Medicare beneficiaries compare most closely. Both can provide broad help with many Original Medicare costs, but they handle a few expenses differently.
With Plan G, you generally pay the Part B deductible, and then the plan may cover most other Medicare-approved out-of-pocket costs covered by the policy. Plan N generally requires you to pay the Part B deductible as well, plus certain copayments. It also does not cover Part B excess charges.
The best fit may depend on how often you expect to use outpatient care, whether doctors in your area accept Medicare assignment, your budget, and how comfortable you are paying some costs as you use care. A lower monthly premium may be appealing, but it is important to understand the possible costs at appointments or during a busy medical year.
Can you use any doctor with a Medicare Supplement plan?
In most cases, you can see any doctor or hospital nationwide that accepts Medicare patients. Medicare Supplement plans generally do not use provider networks in the same way many Medicare Advantage plans do.
That flexibility can be especially helpful for people who travel often, live in more than one state during the year, or want the option to see specialists in different locations. However, it is still wise to confirm that a provider accepts Medicare before receiving non-emergency care.
How should you compare Medicare Supplement plans?
Start by deciding how much cost-sharing you are comfortable with. Then compare the plans available where you live. Since the basic benefits for the same letter are generally standardized, you can also look closely at the insurance company.
- Compare the monthly premium and how it may change over time
- Review the plan letter's covered benefits and your possible out-of-pocket costs
- Ask how the carrier sets and adjusts rates
- Check the company's service reputation and financial strength
- Make sure you understand enrollment rules and whether medical underwriting may apply
- Consider a Part D plan separately if you need prescription drug coverage
Your best time to buy a Medicare Supplement plan is often your one-time Medigap Open Enrollment Period, when you may have important protections. Outside certain protected situations, insurers may use medical underwriting, and acceptance is not guaranteed.
Choosing a Medicare Supplement plan does not have to be overwhelming. Eric can help you compare available Medigap options in your state, understand the differences between plan letters, and review your choices with free, no-pressure guidance.