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(Link to our recent podcast discussing 2023 trends in Plan G and Plan N)
So, you have gone through the research and have decided that purchasing a Medicare supplement (aka Medigap) is for you. Phew, one giant decision behind you! (and, don’t forget that you can always enroll into a Medicare Advantage plan down the road…Starting with Medigap is never a permanent decision unless you want it to be) Now, your next decision will become “which Medigap letter plan will you enroll into?”
For those of you freshly turning 65 years old, Plan G and Plan N are the two most popular plans on the market today. While both plans provide coverage for many of the same services, there are some key differences between them that we’ll discuss and then you can decide which plan is best for you.
Plan G is the most comprehensive supplemental insurance policy available to you if you are turning 65. (We mention turning 65 because if you were eligible for Medicare prior to 1/1/2020, you are able to purchase Plan F which is a tad more comprehensive than Plan G. But, that’s a different article).
Plan G covers all of the co-pays and coinsurance charges that Original Medicare (Part A and Part B = Original Medicare) has. This includes coverage for hospital stays, emergency room visits, doctor visits, preventive care, outpatient care and more. The only cost not covered by Plan G is the annual Part B deductible (which in 2024 is $240).
On the other hand, Plan N is a more basic version of Plan G. It will cover the same services covered by Original Medicare (Part A and B). But, Plan N does not cover certain things such as excess charges from doctors or providers who do not accept the Medicare-approved amount as full payment for a covered service . What that means is that if a doctor that you see does not accept the Medicare-approved amount as payment in full, they have the ability to also charge you, the consumer, up to 15% more than the Medicare allowable amount.
Plan N will also require you to pay a co-pay at doctors visits. The co-pay amount is “up to $20.00” per visit. This co-pay does not apply to physical therapy, however. But if you see a cardiologist? You’ll pay the $20.00 for example.
Plan N will also require you to pay a $50.00 co-pay if you visit an emergency room and you are not admitted as an inpatient.
Finally, Plan N will also require you to pay the annual Part B deductible each year, just like Plan G. Again, the deductible is currently $240 annually.
How do you find out if a particular doctor does or does not accept the Medicare allowable amount for payment in full? The best way to do that is to ask your doctor’s office and/or go to Medicare.gov and go to the area that says “find care providers”. You’ll then enter a specific doctor’s name and the software will tell you whether or not that particular physician does or does not accept the Medicare allowable amount. This is a good thing to check if you have Plan N so that there are no surprises.
And, we do find that MOST doctors do indeed accept the Medicare approved amount so we don’t find excess charges being a common occurrence. However, remember that with Plan N, the potential is indeed there to stumble across excess charge bills.
When comparing these two plans, keep in mind that premiums tend to be lower with Plan N since it doesn’t cover as much as Plan G does. However, if you require frequent medical attention then it may be more cost effective to go with a plan like Plan G which offers more comprehensive coverage for those frequent trips to doctor’s office or hospital stays.
Can you purchase Plan N and then “upgrade” to Plan G later based on need? This is a really common question that we get and the answer is “No, for the most part”. The majority of insurance carriers will require you to go through medical underwriting to determine if you will qualify for a new plan. Even if you are trying to change from a Plan N to a Plan G with the same insurance carrier. And, logically, when do people want to change plans? When their health has changed and they are requiring more doctoring. Does the insurance carrier want to take on more of your costs? You know the answer to that one!
Another thing to point out related to Plan N is that there are certain states that have passed laws that protect the consumer against excess charges. Meaning that they can not be assessed. So, this can remove that concern for anyone residing in one of the following states: Connecticut, Minnesota, Massachusetts, New York, Ohio, Pennsylvania, Rhode Island and Vermont.
So, just like with any other type of health insurance policy; you must consider your own health needs before deciding on coverage so keep in mind that what might work best for one person may not necessarily work best for another due to differences in medical history and future health expectations so make sure that whatever policy option you choose fits your specific circumstances so that you don’t end up regretting your decision later down the line!