Did you know that choosing the wrong Medicare Supplement plan could cost you thousands of dollars over the next decade? It’s true – and after helping folks navigate this decision for over 25 years, I’ve seen it happen more times than I care to count.
Look, when you’re comparing Plan G and Plan N, you’re not just picking between two random letters of the alphabet. You’re making a financial decision that’s going to impact your healthcare costs for years to come. And here’s the kicker: there’s no one-size-fits-all answer.
The good news? Once you understand what really matters about these two popular Medigap plans, the choice becomes crystal clear. Let me walk you through everything you need to know – without the insurance jargon that makes your eyes glaze over.
Understanding Medicare Supplement Plans G and N
Let’s start with the basics. Medicare Supplement plans (also called Medigap) are like the safety net for your Original Medicare coverage. They catch the bills that Medicare drops – and trust me, Medicare drops plenty.
Both Plan G and Plan N are among the most popular choices these days, especially since Plan F went bye-bye for new Medicare beneficiaries in 2020. But here’s where it gets interesting: while they’re both solid options, they work in fundamentally different ways.
What Medicare Supplement Plans Cover
Think of Original Medicare as covering the big stuff – about 80% of your medical costs after you meet your deductibles. That remaining 20%? That’s where things can get scary fast.
I once had a client who thought that 20% couldn’t be that bad. Then he needed a hip replacement. When the total bill came to $50,000, that “little” 20% turned into $10,000 out of pocket. Ouch.
Medigap plans step in to cover these gaps. They handle things like:
- Medicare Part A and B coinsurance
- Hospital costs beyond what Medicare covers
- Skilled nursing facility coinsurance
- Blood transfusions (first 3 pints)
- Part A hospice care coinsurance
But – and this is crucial – not all plans cover these things equally.
How Medigap Plans Work with Original Medicare
Here’s something that confuses a lot of people: Medigap plans don’t replace Original Medicare. They work alongside it.
When you visit the doctor, Medicare gets the bill first. They pay their share (usually 80% after deductibles), then automatically send the remaining bill to your Medigap insurer. You don’t have to file claims or jump through hoops. It just… happens.
The beauty of this system? You keep all the flexibility of Original Medicare – see any doctor who accepts Medicare, no referrals needed – while getting predictable costs. It’s like having your cake and eating it too, assuming you pick the right plan.
Plan G Coverage and Benefits
Plan G is what I call the “Cadillac” of Medicare Supplement plans these days. Not because it’s flashy, but because it’s comprehensive and reliable.
What Plan G Covers
Plan G covers virtually everything Original Medicare doesn’t, with one exception: the Part B deductible. And we’re talking about comprehensive coverage here:
- 100% of Medicare Part A coinsurance and hospital costs (up to an additional 365 days after Medicare benefits are exhausted)
- 100% of Medicare Part B coinsurance or copayments
- 100% of Part A hospice care coinsurance or copayment
- 100% of skilled nursing facility care coinsurance
- 100% of Part A deductible
- 100% of Part B excess charges
- First 3 pints of blood
- 80% of foreign travel emergency care (up to plan limits)
What does this mean in real life? Once you pay that Part B deductible (just $240 in 2024), you’re done. No surprises, no copays, no “oh, by the way” bills showing up three months later.
Plan G Out-of-Pocket Costs
With Plan G, your out-of-pocket costs are refreshingly simple:
- Your monthly premium (varies by location and insurer)
- The annual Part B deductible ($240 in 2024)
- That’s it.
I’ve had clients who love this predictability. One gentleman told me, “Adam, I budget $240 at the beginning of the year for that deductible, and then I don’t think about medical costs again.” That’s peace of mind you can’t put a price on.
Well, actually you can – it’s whatever your monthly premium is.
Plan N Coverage and Benefits
Plan N is what I like to call the “smart shopper’s choice.” It’s got lower premiums than Plan G, but you’ll pay a bit more when you actually use healthcare services.
What Plan N Covers
Plan N covers most of what Plan G does, with a few key differences:
- 100% of Medicare Part A coinsurance and hospital costs (same as Plan G)
- Part B coinsurance, EXCEPT copayments up to $20 for office visits and $50 for ER visits
- 100% of Part A hospice care coinsurance
- 100% of skilled nursing facility care coinsurance
- 100% of Part A deductible
- First 3 pints of blood
- 80% of foreign travel emergency (same as Plan G)
Notice what’s missing? Plan N doesn’t cover Part B excess charges. More on that bombshell in a minute.
Plan N Copayments and Cost-Sharing
Here’s where Plan N gets interesting – and where some people get nervous.
With Plan N, you might pay:
- Up to $20 for office visits
- Up to $50 for emergency room visits (waived if admitted)
- The Part B deductible (same as Plan G)
- Any Part B excess charges
Now, that “up to” is important. Many doctors don’t charge the full copay, and some don’t charge it at all. I’ve had clients report paying $5 or $10 for visits, not the full $20.
But let’s be real: if you’re seeing doctors frequently, those copays add up. One client of mine with diabetes sees specialists monthly. For her, those $20 copays would mean an extra $240+ per year – suddenly that premium savings doesn’t look so hot.
Key Differences Between Plan G and Plan N
Alright, let’s cut through the noise and talk about what really matters when you’re choosing between these plans.
Coverage Gaps and Copayment Requirements
The biggest practical difference? Those pesky copayments with Plan N.
Plan G: See the doctor, pay nothing (after meeting your Part B deductible).
Plan N: See the doctor, possibly pay up to $20.
Seems simple enough, right? But here’s what catches people off guard: it’s not predictable. Some visits you’ll pay nothing. Some you’ll pay $20. Some you’ll pay something in between.
I had a client switch from Plan N to Plan G because she couldn’t stand the uncertainty. “Adam,” she said, “I don’t mind paying more monthly if I know exactly what I’m paying.”
On the flip side, I’ve got clients who love Plan N. One guy told me, “I see my doctor maybe three times a year. Even if I pay $20 each time, that’s $60. My premium savings are way more than that.”
Excess Charge Protection
Here’s the elephant in the room: Part B excess charges.
When a doctor doesn’t accept Medicare assignment (meaning they don’t agree to Medicare’s approved amount), they can charge up to 15% more. Plan G covers this. Plan N doesn’t.
Sounds scary, right? Here’s the reality check: only about 5% of doctors nationwide charge excess fees. And in some states (Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont), excess charges are actually banned.
But – and this is a big but – if you travel a lot or live in an area where doctors commonly don’t accept assignment, this could bite you. I’ve seen excess charges range from a annoying $50 to a painful $500+ for specialized procedures.
Premium Costs and Value Comparison
Let’s talk money – because at the end of the day, that’s what this decision often comes down to.
Monthly Premium Differences
In my experience, Plan N premiums typically run 15-30% less than Plan G. We’re talking real money here.
For example, in my area:
- Plan G might cost $150/month
- Plan N might cost $115/month
That’s $420 per year in savings. Not chump change.
But here’s where it gets tricky. Premium differences vary wildly by:
- Your ZIP code
- Your age
- The insurance company
- Whether you qualify for household discounts
I’ve seen situations where Plan N is only $10/month cheaper than Plan G. At that point, it’s almost a no-brainer to go with Plan G. But I’ve also seen $60+ monthly differences where Plan N starts looking mighty attractive.
Long-Term Cost Considerations
Here’s something most people don’t think about: rate increases.
Both plans will see premium increases over time – that’s just reality. But Plan G tends to have more stable, predictable increases. Why? The risk pool is generally healthier since people willing to pay higher premiums often take better care of themselves.
Plan N can sometimes see steeper increases, especially if the insurer gets hit with higher-than-expected copayment waivers.
I always tell my clients: don’t just look at today’s premium. Ask about the company’s rate increase history. A company with 3-4% annual increases beats one with 8-10% increases, even if they start cheaper.
Also consider your health trajectory. If you’re healthy now but have a family history of conditions that’ll require frequent doctor visits, Plan G might save you money long-term.
Who Should Choose Plan G vs Plan N
After 25+ years in this business, I’ve developed a pretty good sense of who thrives with each plan.
Best Candidates for Plan G
Plan G is perfect for you if:
You see doctors frequently. If you’re managing chronic conditions or see specialists regularly, those Plan N copays will eat into your savings fast.
You value predictability. Some folks just sleep better knowing exactly what their healthcare will cost. No surprises, no mental math at the doctor’s office.
You travel extensively. More travel means more chances of encountering doctors who charge excess fees. Plan G eliminates that worry.
Premium difference is small. If Plan G is only $10-15 more per month than Plan N in your area, it’s probably worth it.
You can afford the premium comfortably. If the higher premium doesn’t strain your budget, the comprehensive coverage is worth it.
I recently helped a couple where the husband had heart issues and the wife had arthritis. They see doctors constantly. For them, Plan G was a slam dunk.
Best Candidates for Plan N
Plan N shines for people who:
Rarely see doctors. If you’re one of those lucky folks who just needs an annual checkup, Plan N can save you serious money.
Live in states banning excess charges. If you’re in one of those eight states I mentioned, that’s one less thing to worry about.
Have a tight budget. Sometimes that premium difference makes Plan N the only realistic option. Some coverage beats no coverage every time.
Don’t mind small copays. If paying $20 here and there doesn’t bother you, why pay hundreds more annually for Plan G?
Are comfortable with some risk. Plan N requires accepting a bit of uncertainty in exchange for savings.
One of my healthiest clients, a 66-year-old marathon runner, chose Plan N. He figures even if he has a bad year health-wise, his total costs will still be less than Plan G premiums.
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