Medigap Plan N is a relatively new Medigap plan. It came out as part of the revision of the standardized plans in 2010, and it has really become one of the more popular plans. Due in large part to the incorporation of the plan into many companies offerings, many people are choosing it as a lower-cost alternative to some of the other Medigap plans. So, what is Plan N and who is choosing this plan?
First and foremost, you must understand what Plan N covers:
- It is the same as the more expensive plans at the hospital (Medicare Part A). It still covers the Medicare Part A deductible and the 20% that Medicare doesn’t cover at the hospital, skilled nursing facility, etc. (Part A costs).
- The differences come under Part B. Plan N doesn’t cover the Medicare Part B deductible ($140/year for 2012). Also, Plan N doesn’t cover the Medicare Part B Excess charges. These are very rare but occur when a doctor does not accept Medicare “assignment” (in other words, he/she doesn’t accept the Medicare payment schedule). The doctor can charge up to 15% over the normal Medicare payment schedule, and Plan N doesn’t cover this (What Are Part B Excess Charges?). This, incidentally, only happens in about 1% of cases nationwide. Lastly, Plan N does include some small co-pays. The co-pays are $20 for doctor’s visits and $50 for a trip to the ER. So, there are really three differences: Part B deductible, Part B excess charges, and co-pays.
With these differences in mind, you can see that, although ‘N’ is definitely a lower level of coverage than something like Plan F or Plan G, it can be a very good option and still provides comprehensive coverage, including the full coverage at the hospital that is so attractive about the Medigap plans. Moreover, because it is one of the standardized Medigap plans, it still provides the security of nationwide coverage, no networks, guaranteed renewability, etc. that all of the supplement provide – in contrast to Medicare Advantage plans which have co-pays like ‘N’ but are not national plans, all have networks and are not guaranteed renewable.
Plan N is typically about $40 less than Plan F, on average with most companies that offer it. Many companies have adopted it and now offer it as their alternative for people in good health who may not want to pay the larger cost for Plan F. It is certainly something to consider.