Medicare Supplement (Medigap) plans like Plan N and Plan G help fill coverage gaps in Original Medicare. When weighing these two popular options, one key consideration is the difference in out-of-pocket costs. This article explores the key distinctions between Plan N and Plan G when it comes to your expenses.
A key difference between Plan N and G lies in the monthly premiums. Premiums for Plan G tend to be significantly higher than Plan N. Why? Plan G offers more generous coverage, including:
- Coverage of Medicare Part B excess charges
- No copays or coinsurance for any covered services
Meanwhile, Plan N requires some out-of-pocket spending, which is why its premiums are typically lower. However, even though Plan N premiums are more affordable, you’ll have to pay copays or coinsurance in certain situations.
Key Areas of Cost Sharing
While both plans cover some out-of-pocket health expenses beyond Original Medicare, there are three key areas where Plan N requires more cost sharing:
Part B Copays
Plan G pays the full cost of Medicare Part B copays and coinsurance, while Plan N requires some out-of-pocket spending. Specifically, with Plan N you must pay:
- A $20 copay for doctor office visits
- A $50 copay for emergency room visits if you are not admitted as an inpatient
So while Plan G covers 100% of Part B copays and coinsurance costs, Plan N requires you to pay a portion of certain services out of your pocket. This is a key difference in cost sharing between the two plans.
Inpatient Hospital Care
If you require inpatient hospital care, Plan G covers 100% of Medicare Part A deductibles and coinsurance. With Plan N, you must pay some of the Medicare Part A deductible and coinsurance per benefit period.
Foreign Travel Emergencies
Plan G covers 80% of the cost of foreign travel emergencies, while Plan N offers no coverage for care outside the United States. So there is a clear difference between Plan N and G when it comes to overseas coverage.
The only exception to Plan N’s cost sharing requirements is coverage for excess charges for Medicare Part B services. On this particular benefit, Plan N and G offer identical protection.
Evaluating the Cost-Coverage Trade-Off
Clearly, the main trade-off between Plan N and Plan G comes down to your out-of-pocket costs versus the plan premium. Plan N requires more spending throughout the year on things like copays and hospital coinsurance. Yet it costs substantially less per month than Plan G.
So is the lower premium worth the extra cost sharing down the road? The answer depends largely on your health, lifestyle, and budget.
If you rarely need medical services beyond routine office visits, the cost savings on Plan N premiums could make it the better value overall. But if you have complex health needs and expect significant hospitalizations or emergencies, Plan G’s lower cost-sharing will likely pay off in the long run.
Of course, your personal financial situation also impacts this decision. Can you easily absorb unexpected medical costs with Plan N if they come up? Or is keeping your premium costs predictable with Plan G more in line with your needs?
There’s no one “right” choice when determining between Plan N and G. You have to carefully analyze how both options align with your health profile and current finances. This helps ensure you pick the one that provides the optimal balance of premium costs and coverage.
While Plan N and Plan G take different approaches to cost sharing, they both offer solid protection compared to Original Medicare alone. When weighing these two options:
- Plan N premiums are lower, but you pay more out-of-pocket for certain services
- Plan G premiums are higher, but most Medicare copays and coinsurance are 100% covered
- Striking the right balance depends on your expected healthcare needs and budget
Hopefully, this outline of the key differences between Plan N and G provides useful insight into choosing the right Medigap plan for your situation. Analyzing these potential costs and coverage trade-offs allows you to make an informed, confident decision.