Medicare Supplement Plan G, also called Medigap Plan G, is a supplemental policy that has become more common since it was first made available a few years ago. And thanks to the phasing out of the popular Medigap Plan F in 2020, Plan G is now the plan of choice for many.
Medicare Supplement/Medigap Overview
There are 10 standardized Medicare Supplement policies (A, B, C, D, F, G, K, L, M, N) that help reduce your costs under Original Medicare (Part A and B). Medicare doesn’t fully cover all treatments and services, leaving “gaps” that these policies can fill.
If you have a Medigap policy, you can use any doctor, hospital or facility that accepts Medicare in the U.S. and U.S. territories such as Puerto Rico or the Virgin Islands. The healthcare providers must be enrolled in Medicare and must accept new Medicare patients. The majority of doctors and hospitals in the U.S. take Original Medicare.1 Six of the plans (C, D, F, G, M, N) cover foreign travel emergencies up to plan limits — typically $ 50,000-lifetime limit coverage after an initial $250 deductible in the first two months of travel .2
What Does Plan G Cover?
Plan F is considered the top-of-the-line Medigap policy. It covers 100% of the gaps in Medicare. Plan G’s coverage is nearly as good with one exception: Plan G does not cover the Part B deductible, which is $198 in 2020. Even with paying the Part B deductible, many Medicare enrollees find Plan G more cost-effective than Plan F when considering their respective premiums.
Plan G covers everything that Medicare Part A and B cover at 100% except for the Part B deductible. This means that you won’t pay anything out-of-pocket for covered services and treatments after you pay the deductible.
Like Medigap Plan F, Plan G also covers “excess charges.” Doctors who don’t accept the full Medicare-approved amount as full payment can charge you up to 15% more than the Medicare-approved amount for services or procedures. This is known as the “excess charge.”3 Most doctors accept the Medicare-approved payment and cannot bill you the extra amount. Since 2016, excess charges are illegal in these states: Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont.
Medicare Part A
What Does Medicare Part A cover:
- Inpatient care in semi-private hospital room
- Skilled nursing facility care following a hospital stay of three or more days
- Inpatient care in a skilled nursing facility — not custodial or long-term care
- Part-time home health care, i.e., occupational, physical, speech therapy, illness counseling. It does not include custodial, personal care or homemaker services.
- Hospice care
- Blood for transfusions, after the first three pints
What Part A does not cover:
- $1,408 deductible when admitted for hospital stay
- Hospital inpatient days 61-90. You pay $352 per day.
- Hospital inpatient days beyond 90 days.* You pay $704 per day.
- Skilled nursing facility stay days 21-100. You pay $176 per day.
* You have 60 additional days to use beyond 90 days at the $704 daily rate. These are Lifetime Reserve days you can use across different Benefit Periods (each time you are in a hospital or skilled nursing facility). There must be at least 60 days between stays to use Lifetime Reserve days.
These amounts are applied to each “benefit period” which is when you enter a hospital or skilled nursing facility (SNF) and ends when you have not received care in those settings for 60 days in a row.
Medicare generally does not pay for Part A and B services or items outside the U.S. and U.S. territories. Medicare may, however, cover inpatient hospital care outside the U.S. under rare circumstances.
Medicare Part B
Medicare Part B mainly focuses on outpatient services. After you pay the initial Part B deductible, which is $198 in 2020, your coinsurance rate is 20%.
What Does Medicare Part B Cover?
Part B services covered at 80% include outpatient care in an emergency room or hospital, and diagnostic tests such as X-rays. For many preventive services, the coinsurance and the deductible do not apply such as standard flu shots, mammograms, bone density tests, glaucoma tests, and many cancer screenings. Some preventive services have criteria you need to meet before getting the preventive service without the coinsurance and/or deductible. If you don’t meet the criteria, the service will be covered under Part B but with the coinsurance and deductible.
Part B also covers doctor’s visits, ambulances, mental healthcare, outpatient surgeries, home health care, durable medical equipment (DME) such as blood sugar monitors and test strips, lancet devices, walkers, and wheelchairs. Home health care is also covered under Medicare Part A if certain conditions are met.
What Does Medicare Part B Not Cover?
Medicare Part B does not generally cover healthcare outside of the U.S. You may find this publication, “Medicare Coverage Outside the US,” helpful for specific examples of when Medicare covers healthcare outside the US.
If Original Medicare doesn’t cover something, no Medicare Supplement plan will cover it. Medicare does not cover:
- Long-term care (also called custodial care)
- Most dental care
- Eye exams related to prescribing glasses
- Cosmetic surgery
- Hearing aids and exams for fitting them
- Routine foot care
What does Plan G cost?
Plan G premium costs vary widely, depending on where you live. In many states, costs also vary based on your gender and whether you smoke or vape.
In 2020, Plan G costs range from $99 per month to $509 per month.4 According to a price analysis conducted by the American Association for Medicare Supplement Insurance in February 2020:
2020 Medicare Supplement Insurance Cost Analysis – Turning 65 Price Comparison Lowest and Highest Monthly Premium Costs for Medigap Plan G in Top Metro Markets
- Lowest Female: $99 per month, Dallas, TX zip code 75001
- Highest Female: $476 per month, New York, NY zip code 10012
- Lowest Male: $109 per month, Dallas, TX zip code 75001
- Highest Male: $509 per month, Philadelphia, PA zip code 19050
Who can sign up for Plan G?
If you qualify for Original Medicare, you may be able to enroll in Plan G. American citizens and legal residents of at least five years can qualify for Medicare. Having worked 10 or more years is a requirement for getting Part A without a premium. If you have not worked 10 years in the US, you may still be eligible for Medicare but you have to pay the Part A premium. And in most cases, you should either be turning 65 or have a disability that qualifies for Social Security disability benefits.
The only exception to getting Medicare without the 2-year wait is amyotrophic lateral sclerosis (ALS). Cancer and other diseases e.g. some cases of breast cancer, early-onset Alzheimer’s disease, may be considered a disability if it meets the SSDI criteria and the 24-month waiting period applies.5
How and When Can You Enroll in Plan G?
During Open Enrollment
The best time to enroll in Plan G is during the Medigap Open Enrollment Period (OEP). The OEP starts when you turn 65 and your Medicare Part B is effective. Medicare enrollees 65 years or older can buy a Medigap at any time but may be subject to health screening and medical underwriting. There are some advantages to buying a Medigap during one’s open enrollment period. During OEP, healthy people and those with health conditions will pay the same for Plan G from the same company.6
If you are under age 65 and have Medicare, you may be able to apply for a Medicare Supplement plan depending on where you live. Some states require Medigap insurance companies to sell Medigap plans to Medicare enrollees younger than 65. Each state has its own rules regarding health screening, rates, and Open Enrollment for Medicare enrollees younger than 65. For example, Open Enrollment is ongoing for under age 65 Medicare beneficiaries in some states which means you can start a new Medigap plan the first day of the following month. Please check with your state insurance department for specific guidelines.
After Open Enrollment
In most states, if you sign up outside the OEP, you may be subject to medical underwriting. This means you could pay a higher premium if you have preexisting health conditions. Your application might even be declined. Only four states (Connecticut, Massachusetts, Maine and New York) require insurers to offer Medigap policies to those who are eligible, whether or not they have preexisting conditions.7
Switching From Medicare Advantage
If you currently have a Medicare Advantage plan, when can you switch to Plan G? You can switch to Original Medicare during the Annual Election Period from October 15 to December 7, or the Medicare Advantage OEP from January 1 to March 31. Then you can apply for a Medicare Supplement plan.
In most states you will not have guaranteed-issue rights when you switch, meaning you might face medical underwriting and higher premiums. Some states do allow it. To see what the Medigap rules are where you live, check with your state insurance department.
Why Consider Plan G?
Plan G is the top-of-the-line Medigap option if you’re newly eligible for Medicare. Depending on where you live in the country, it can range from $99 per month to $509 per month for the plan premium, which is $1,108 to $6,108 per year. For the premium, which is higher than for other Medigap policies, you’ll get more comprehensive coverage.
Plan G covers nearly all out-of-pocket costs for services and treatment once you pay the Medicare Part B $198 deductible. This means you pay no copays or coinsurance.
If you don’t need that level of coverage, though, you might want a plan with less coverage.
What Are Other Options?
There are nine other plans for beneficiaries to consider, but Plans F, G and N are the most popular.
Plan F has for many years had the highest number of enrollees, covering more than half of policyholders from 2014 to 2017. Plans C, G and N have been popular choices, with G and N gaining popularity for the same time period.8
In 2020, Medigap Plans C and F aren’t available to those newly eligible for Medicare.9 If you’re already a Medicare member, you can still choose Plan F or C.
Plan F and Plan N are often chosen instead of Plan G. Plan F is the most comprehensive Medigap plan since it covers 100% of the gaps in Medicare coverage, so costs more than Plan G or N. This means co-pays for Medicare-covered services and items under Medicare Part A or Part B will be $0 co-pay for those with Plan F. Plan G has nearly the same level of coverage as Plan F. With Plan G, you are responsible for the Part B deductible of $198. Otherwise, coverage is exactly the same as Plan F.
Plan N is the least expensive of these three plans but you’ll have more out-of-pocket costs with it. With Plan N you are responsible to pay these three items that Plan F covers in full:
- Maximum of $20 for doctor visits and $50 for ER visits
- Part B deductible of $198
- Excess Charges (if any)
If you’re more focused on preventive care like doctor’s visits, and don’t expect to have more serious medical needs, then Plan N could save you money.
Plan G offers top coverage for preventive visits, emergency care or chronic conditions. It is a comprehensive option you should consider for supplementing your Medicare coverage.