Medicare Plan G, also called Medigap Plan G, is a type of supplemental insurance that helps pay for the gaps in Medicare coverage left by deductibles, coinsurance, and copayments. The costs of Plan G can vary.
Medicare is a federally funded insurance plan that covers people ages 65 years and older. Younger people with specified health conditions may also qualify.
Original Medicare has two parts: Part A pays for hospital care, and Part B pays for doctor visits and other outpatient services.
Both parts have associated deductibles, coinsurance, and copayments. Medigap plans help cover these expenses.
In this article, we discuss Medicare supplement plans, including Medigap Plan G, and its costs.
Glossary of Medicare terms
- Out-of-pocket cost: This is the amount a person must pay for care when Medicare does not pay the total amount or offer coverage. Costs can include deductibles, coinsurance, copayments, and premiums.
- Premium: This is the amount of money someone pays each month for Medicare coverage.
- Deductible: This is an annual amount a person must spend out of pocket within a certain period before Medicare starts to fund their treatments.
- Coinsurance: This is the percentage of treatment costs that a person must self-fund. For Medicare Part B, coinsurance is 20%.
- Copayment: This is a fixed dollar amount a person with insurance pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
Medicare supplement insurance is also called Medigap.
Several types of Medigap policies exist, including Medigap Plan G. In addition to covering deductibles, coinsurance, and copayments, the policies may offer additional benefits not provided by Original Medicare.
For example, some Medigap policies cover emergency healthcare that may be needed when traveling outside the United States.
To buy a Medigap policy, a person must first have Medicare parts A and B.
Medicare Advantage plans, also known as Part C, combine the coverage of Original Medicare with other benefits, such as vision, dental, and hearing care.
If a person has a Medicare Advantage plan, they cannot have a Medigap policy at the same time. A company cannot legally offer a Medigap plan to someone they know is already enrolled in Medicare Advantage.
Private companies sell Medigap policies, and because of this, costs, including the premiums for Plan G, can vary.
There are many factors that affect the price of Medigap policies. For starters, companies use three main methods to determine prices:
- Community-rated: All beneficiaries pay the same premium regardless of their age. Prices may change based on inflation or other factors.
- Issue-age-rated: The age of a person when they buy the policy will determine the price. The premium may go up for other reasons, but not because of age.
- Attained-age-rated: The premium will go up as a person gets older. These plans are the least expensive initially but become the most costly as a person ages.
Other factors that may influence price include:
- Discounts: Some policies offer discounts, such as for people who do not smoke, are married, pay yearly, or use specific payment methods.
- Medical underwriting: Underwriting is used when a person delays enrollment. This is an evaluation of risk based on a person’s medical history that may affect the cost.
- Specific benefits: A person may choose to include a comprehensive set of benefits that may affect the price of the plan.
Medigap policies must follow federal and state laws and offer the same basic benefits. State laws affect which plans are available in a person’s area.
Some companies choose to offer more benefits than others, and people may like to compare policies offered in their state to ensure they can get a plan that suits their needs.
Medigap plan types
There are 10 Medigap plans that are named by letters A, B, C, D, F, G, K, L, M, and N. The standard benefits the plans may cover include:
- Part A deductible
- Part A coinsurance and hospital costs up to 365 days after Medicare benefits have been used in full
- Part A hospice coinsurance or copayment
- Part B coinsurance or copayment
- the first 3 pints of blood a person may need
Medigap plans C and F also cover the Medicare Part B deductible, but starting January 1, 2020, these plans are no longer available to newly eligible Medicare beneficiaries.
If a person already has a Medigap plan that includes coverage for the Part B deductible, they may keep it.
Medigap Plan G covers many of the benefit options of the discontinued Plan F, making it a popular alternative. This table shows the primary Plan G benefits:
| Benefit | Is it covered? |
|---|---|
| Part A deductible | yes |
| Part A coinsurance and hospital costs | yes |
| Part A coinsurance or copayment for hospice | yes |
| Part A coinsurance for skilled nursing facility care | yes |
| Part B deductible | no |
| Part B coinsurance or copayment | yes |
| Part B excess charge | yes |
| blood, first 3 pints | yes |
| emergency treatment required during foreign travel | 80% coverage |
Medicare recommends the following steps to help a person decide on a Medigap plan suitable for their needs and circumstances.
- Consider: A person may decide upon the benefits they need by considering their current healthcare needs.
- Research: An individual may like to research the companies that sell Medigap policies in their state. Local plans will be displayed when using the Medigap policy finder search tool. A person’s State Health Insurance Assistance Program (SHIP) can also offer advice either online or by phone.
- Learn: By learning about the companies and the costs of their policies, a person can feel confident they are making an informed decision for their healthcare.
- Apply: Individuals should apply for a Medigap policy directly with the private insurance company offering the desired plan.
Medigap Plan G is a form of supplemental insurance that covers “gaps” in Original Medicare left by coinsurance, copayments, and deductibles.
Private companies sell Medigap policies that can cover the same benefits but charge different amounts.
Medigap Plan G premiums are set in one of three ways but will vary between insurers. How the company decides the premium will affect the cost for as long as a person has a policy.
It can be valuable for a person to research and compare options when choosing a Medigap policy.
The State Health Insurance Assistance Program (SHIP) can help people find the best plan for their needs and circumstances.