Can you answer “yes” to the following questions? If so, then Medicare Supplement Plan N may be the plan for you!
- Are you looking for a plan that offers excellent “value”? Value can be thought of as a combination of good coverage and reasonable monthly premiums.
- Would you prefer to have a plan that has had low annual rate increases relative to other plans?
- Are you willing to share in your health care costs in exchange for a lower monthly premium?
Medigap Plan N offers excellent value!
Medicare Supplement Plan N Overview
Plan N may offer the best value of any of the Medicare Supplement plans. What exactly is value? The dictionary defines value as “a fair return or equivalent in goods, services, or money for something exchanged”.
Let’s look at three components to evaluate the value of Plan N. Those components are 1) monthly premium, 2) coverage and 3) historic rate increases.
Medicare Supplement Plan N monthly premium
Plan N has a monthly premium that is lower than the other popular plans – Plan F and Plan G.
For example, a Plan N for a 70 year old female, non-smoker, in Kansas, is approximately $23 less a month than a Plan G. It’s $45 less than a Plan F. That amounts to annual savings of $276 compared to a Plan G and $540 compared to a Plan F.
Plan N’s coverage
The original purpose of insurance was to transfer the risk of a large financial loss to a third party (insurance company) in exchange for a small premium (“small” compared to potential large insurance claim). The first health insurance in the United States formed in Texas in 1929 to help cover the costs of a hospital stay. The insurance allowed the middle class a means of avoiding bankruptcy if they required medical care in a hospital.
Plan N fits the original model of health insurance. For a relatively small monthly premium, your medical bills, regardless of how large, will be covered after you pay your obligations under a Plan N.
Rate increases for Medicare Supplement Plan N
Plan N is the newest Medicare Supplement plan. It was created in 2010. Since 2010, Plan N annual rate increases have averaged approximately 2% below Plan G and 4% below Plan F.
Why are Plan N rate increases less than Plan G and Plan F? The main reason is because of the plan’s claims experience. Claim experience is the amount of money the insurance company has to pay out for an insurance claim. Plan N generally has lower claims experience than Plan G and Plan F. One of the reasons is that Plan N policyholders have “skin in the game”. They share in more of their medical costs than their counterparts in Plan G and F. Because of this, they may be less inclined to seek unnecessary care.
Medicare Supplement Plan N Benefits
| Gaps in Original Medicare | Plan N coverage |
|---|---|
| Medicare Part A coinsurance and hospital costs (up to an additional 365 days after Medicare benefits are used) | 100% |
| Medicare Part B coinsurance or copayment | 100%* |
| Blood (first 3 pints) | 100% |
| Part A hospice care coinsurance or copayment | 100% |
| Skilled nursing facility care coinsurance | 100% |
| Part A deductible | 100% |
| Part B deductible |  |
| Part B excess charges | |
| Foreign travel emergency (up to plan limits) | 80% |
*Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to a $50 copayment for emergency room visits that don’t result in an inpatient admission.
What are your costs under a Medicare Supplement Plan N?
You have four potential costs (in addition to your monthly premium) when enrolled in a Plan N. They are:
Part B deductible
You are responsible for the Part B deductible ($203 in 2021) if you receive medical services that are billed to Part B. You don’t have to pay the deductible if you don’t receive any Part B medical services.
Office visit copay
When you visit your doctor, you’ll be charged “up to” a $20 copay. Most specialists will charge $20, but some general practitioners charge less.
You may be wondering…do ALL office visits have a $20 copay? The answer is NO. The Plan N copay for doctor’s office visits does NOT apply to wellness visits. A wellness visit is intended to design a personal health plan to prevent disease and disability. Your first wellness visit occurs within the first 12 months of enrolling in Medicare, called a “Welcome to Medicare” preventive visit. After you have been enrolled in Part B for 12 months you can receive an annual wellness visit. These are 100% paid for by Medicare Part B.
In addition, if your doctor’s visit is done online or over the telephone, you will not be billed a $20 copay under Plan N. Doctor’s offices do not code these services as office visits, office consultations or evaluation and management visits in their Part B billings. Therefore, these services would not be subject to the Plan N copay of $20.
Emergency Room copay (maybe….)
A visit to the emergency room will cost you a $50 copay if you are NOT formally admitted as an inpatient. So, if you leave the emergency room the same day you arrived there is no copay. However, if you are admitted as an inpatient there is no 
copay.
Please note there is a special circumstance that may arise where your doctor orders you to stay overnight after your ER visit. It’s a special circumstance because he doesn’t admit you as an inpatient, but rather keeps you under “observation status”. If this happens, you will have to pay the $50 copay. This is because observation status is not the same as being admitted as an inpatient. They are keeping you overnight to further monitor your situation.
Excess charges (probably not…)
In rare circumstance, a provider may charge you an additional 15% above the Medicare approved amount. Only 4% of the Medicare providers in the United States can charge an excess charge.
Note that excess charges are only possible on a Part B covered service. There are no excess charges for services billed to Part A.
How to avoid
Part B excess charges are easy to avoid. The main reason is because 96% of the providers don’t charge an excess charge. You can avoid the remaining 4% of providers by using one of the below methods:
- Visit the Medicare.gov website and type in ‘physician compare’ (or call us at 913-717-6782 and let us do the work for you!). Click on the applicable link and then enter your doctor’s information. That will tell you whether or not the doctor accepts Medicare assignment. If they accept assignment, then they can’t bill you for an excess charge.
- Call the Medicare help line at 1-800-MEDICARE (1-800-633-4227) and inquire about your doctor.
- Simply ask your provider if they accept Medicare assignment. This is the least recommended option. The reason is because some doctor’s office personnel get confused between a provider “accepting Medicare” and one that “accepts Medicare assignment”.
How calculated
The excess charge a provider can charge is actually 15% above a reduced amount that Medicare pays non-participating providers (those that accept Medicare, but don’t accept Medicare assignment). Medicare penalizes these providers right from the start by only offering them 95% of what they normally pay a participating provider. From this 5% reduction in payment, the provider can then tack on their 15% excess charge.