Understanding Coverage:  Plan N vs Plan G

Why Should I Consider a Plan N vs Plan G – Long Term Savings

To Start:  Why your 1^st Medigap Plan Choice (Open Enrollment) Matters

(Either at Turning 65 or Delayed Part B Open Enrollment)

Making a decision about your starting or initial Medigap Plan is MUCH different than your first Medicare Advantage Plan choice if you chose that route.  Because unlike a Medicare Advantage plan, you typically can’t just move to a new Medigap / ”Med Supp” plan after the first starting one (when you first begin using Medicare) without going through some fairly simple Medical Underwriting.

If you’re semi-healthy 5-10 years down the road and want a different Medigap plan to save on the rising premiums as you get older… No Problem.  But if your health has taken a major turn for the worse, that might not be an option unless you have a Special Enrollment guideline apply.

NOTE:  If you are currently in a Plan G and looking to lower your rate and overall no major health events… you can apply any time.  Just reach out to us for more details.

Long-Term Advantages of Plan N vs. Plan G

Plan N typically offers lower long-term costs than Plan G due to cheaper monthly premiums, saving many 70+ beneficiaries hundreds of dollars annually.  Provided they have infrequent doctor visits and can handle potential $20-$50 copays.  The key advantage is saving on fixed monthly premium costs, while the trade-off is higher, less predictable out-of-pocket costs at the time of service. 

Cost Advantages of Plan N

• Lower Annual Premiums: Plan N generally has lower, more competitive premiums than Plan G.  Over time, these savings on premiums can well exceed the costs of copayments.
• Reduced Total Costs for Healthy Individuals: For those with fewer doctor or emergency room visits, the premium savings frequently outweigh the $20 office visit/ $50 ER copays.

Note:  If you have Six (6) Doctor Visits and One ER Visit in a year, that is only at most $150 assuming one of those Doctor visits was an Annual Physical which has no copay.  Typically much less than the Plan G higher rate difference cost, especially in later years.

• Lower Exposure to Rate Hikes: Some studies suggest Plan G may have a higher risk of larger rate increases over time.  The initial rate is higher, so incremental % rate hikes are more.  Plus, Plan G’s have more exposure to Guaranteed Issue (GI) members coming into the plan without medical underwriting (could have higher, more expensive health cost exposure) causing a Plan G to commonly have a higher % rate hike than a Plan N year to year, even with the same carrier.

Long-Term Considerations and Trade-offs

• Cost-Sharing: Plan N Cost-Sharing: Plan N requires you to pay for doctor visits (up to $20) and ER Visits (up to $50).  BOTH G&N require members cover the Part B Deductible ($283 in 2026). 
• Part B Excess Charges (Rare): Plan N does not cover Part B excess charges, which occur if a doctor does not accept Medicare Assignment, whereas Plan G covers these 100%.  (See Below for details of these rare charges)
• Predictability: Plan G provides higher predictability, as it covers all out-of-pocket costs after the Part B deductible, providing peace of mind against unforeseen, high-cost health events. 

For individuals who rarely see doctors, Plan N's lower premiums provide better long-term financial value, whereas Plan G acts as a more "set-it-and-forget-it" option for those who prefer predictability and don’t mind the higher rates down the road.

Part B Excess Charge – How to Avoid Them

Medicare Part B excess charges are rare, affecting less than 1% to 2% of doctors and appearing on only about 0.3% of claims. Over 96-98% of providers accept Medicare Assignment, meaning they accept the Medicare-approved amount as full payment.  For those that don’t accept assignment and the excess charges do occur, charges are capped at 15% above the Medicare-approved rate.  And Medicare covers 80% of that.

Key Details on Frequency and Location

• Highly Rare: Most beneficiaries go their entire life without encountering an excess charge.
• Where They Occur:  They are most likely to appear with specific specialists (e.g., in mental health) who choose not to sign a participation contract with Medicare, rather than primary care doctors.

How to Avoid Them

• Ask Before You Go: Simply ask, "Do you accept Medicare Assignment?" before scheduling a visit.
• Check Providers: You can check on the Medicare.gov provider search tool to confirm if a doctor accepts assignment.

Why Most Doctors Choose Medicare Assignment… It’s Simply Easier

Doctors generally prefer Medicare assignment (accepting the approved amount as full payment) over charging excess fees because it guarantees faster, direct payment from Medicare and reduces administrative, billing, and collection burdens.  Additionally, over 98% of providers accept assignment, as it fosters better patient relations and ensures compliance with Medicare regulations. 

Key reasons for preferring Medicare assignment:

• Faster Payment and Less Admin: When doctors accept assignment, they often get paid directly by Medicare, reducing the hassle of collecting the full amount from patients.
• Reduced Patient Conflict: Accepting assignment means doctors agree to the Medicare-approved amount, which eliminates the need to bill patients extra (up to 15%) for Part B Excess Charges.
• High Participation Rates: Because most doctors accept assignment, it is standard practice to avoid the "sticker shock" that often causes patients to seek other providers.
• Administrative Simplicity: It simplifies billing procedures and eliminates the need to manage potential disputes over higher, non-assigned fees

Note:  This information is for information purposes only and GoogleAI was used to organize the original content.  Not Guaranteed by Cypress Health.