What Is Medigap Plan N, and How Does It Work?

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Medicare provides health coverage to millions of people around the United States. It covers a variety of expenses you might incur while you’re in the hospital or seeing your primary care doctor for a checkup. But, in many cases, Medicare doesn’t pay for the full costs of your appointments — it often only covers 80% of those costs, requiring you to pay the remaining 20%. If you want full coverage for your medical bills, you may want to purchase a separate Medigap policy.

Medigap Plan N is a form of supplemental health insurance that helps fill the gaps in insurance coverage that original Medicare doesn’t pay for. Although it includes higher insurance premiums than Medicare alone, it also can reduce your annual out-of-pocket costs for medical care. Is Medigap Plan N the best health insurance coverage for your situation? Learning the details below will help you decide. 

What Is Medigap Plan N?

Medicare is a form of federal health insurance offered, for the most part, to older adults. The coinsurances and copays for Medicare can be expensive. Medigap plans are supplemental insurance plans that pay for the out-of-pocket costs Medicare doesn’t cover. Medigap Plan N is one such plan. It provides insurance coverage for uncovered costs of Medicare Parts A and B.

Commercial insurance companies that sell policies to the public almost always offer Medigap plans. Insurance companies have to offer standardized versions of each of the 10 Medigap plans, all of which are identified by a letter. In other words, if you’re looking for a certain Medigap plan, you know the coverage will be identical from all insurance companies. The only variable is the cost of the monthly premium for the plan. 

Does Medigap Plan N Have a Copay?

Medigap Plan N includes copays of around $20 for doctor’s office visits and $50 for emergency room visits. Under Medigap Plan N, you’re responsible for paying the annual deductible and excess charges for Medicare Part B. For the medical services covered under Medicare Part B, there’s an annual deductible that you’re responsible for, even under Medigap Plan N. This means you’ll pay the full cost of all healthcare covered under Medicare Part B up to that amount per year. Then, the usual copays apply.

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Excess charges apply in two situations: You receive medical care from an out-of-network provider, or you see an in-network provider who charges more for a certain service than Medicare pays. In both cases, the provider can only charge you 15% more than it would cost through Medicare. Under Medigap Plan N, you’d be fully responsible for these out-of-pocket costs.

Although Medigap Plan N generally covers almost all out-of-pocket costs not covered by Medicaid, there are a few exceptions. When your lifetime days in the hospital exceed 365 days, you may start to pay for this inpatient care. When a skilled nursing facility stay exceeds 100 days, you may need to pay a daily fee. 

What Does Medigap Plan N Cover?

In short, Medigap Plan N covers the coinsurance you’d typically have to pay if you were only covered by Medicare Parts A and B. For Medicare Part A, that includes the coinsurance or daily out-of-pocket costs for a hospital stay. Medigap Plan N provides an additional 365 days’ worth of hospital stays covered by insurance. It also covers all blood transfusions and pays the total cost of up to 101 days in a skilled nursing facility. For hospice care, Medigap Plan N covers all additional costs that Medicare alone would leave you responsible for. 

After you meet your deductible for Medicare Part B, Medigap Plan N covers all additional costs for outpatient medical care except the $20 and $50 copays for doctor’s office visits and emergency room care, respectively. As mentioned above, you must also pay any applicable excess charges. Medigap Plan N covers 80% of the cost of medical care while traveling to foreign countries until you reach a lifetime foreign coverage limit of $50,000.

Pros and Cons of a Medigap Plan N Policy

Perhaps the biggest advantage of Medigap Plan N is that it covers some of the most expensive types of longterm healthcare — namely lengthy hospital and skilled nursing facility stays — in full. Many people needing longterm care have to sell assets, spend savings, and take other drastic financial measures to cover the cost. With Medigap Plan N, this high cost may become less of a concern. 

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Medigap Plan N is also especially attractive if you travel often. Four of the Medigap plans offer no coverage for foreign travel. Among those that do offer coverage, an insurance plan that covers 80% of the costs is very generous. Depending on the cost of medical care in the country you visit, paying only 20% for care can result in huge savings. However, this could be insufficient if you live in a foreign country for several months of the year because there’s a maximum lifetime benefit. 

One disadvantage of Medigap Plan N is that you have to pay the premium for the Medigap coverage and the compensation for Medicare Part B. Although these two costs may add up to a larger combined monthly bill for insurance, they will ideally leave you paying very little out-of-pocket, even if unexpected medical needs arise throughout the year. For couples, there’s an added increase in cost because each spouse must purchase an individual plan and pay their own premium in full. There are no savings for family packages.

How to Choose a Medigap Plan N Policy

Medicare’s official website is a great source for reliable information when you’re choosing a Medigap Plan N policy. You’ll enter your ZIP code, age, gender and tobacco use status. Then, you’ll see a list of all Medigap policies available to you based on your age and location. 

Scroll down to Medigap Plan N. You can view the estimated monthly costs, copays, coinsurances and benefits included in the plan. Click on the “view policies” button to see local insurance providers that offer Medigap Plan N to your age group. This page shows the exact monthly cost of each plan, and it includes contact information for each company offering Medigap Plan N near you. 

There are Medigap plans that offer more extensive coverage than Plan N, but they often come with higher monthly premiums. Plan N is considered a good middle-of-the-road option because it includes more coverage than most Medigap plans and more affordable monthly premiums.