Medicare Supplement Insurance 2026: Plan F vs G vs N — Which Medigap Plan Wins?

Medigap: The Insurance Market That Medicare Doesn’t Explain Well

Medicare covers a lot — but not everything. Original Medicare (Parts A and B) leaves beneficiaries exposed to significant out-of-pocket costs: Part A deductibles, hospital coinsurance, Part B deductible, 20% coinsurance on physician and outpatient services, and more. For a major hospitalization, these gaps can add up to tens of thousands of dollars.

Medicare Supplement Insurance — universally known as Medigap — fills these gaps. But with 10 standardized plan letters (A through N), an enrollment timing trap that most seniors aren’t warned about, and the ever-present Medicare Advantage alternative, the decision is more complex than it appears.

This article gives you the analysis to choose correctly.

Primary authority: CMS Medicare & You handbook (medicare.gov); Medicare Supplement (Medigap) plan comparison at medicare.gov; CMS.gov for enrollment period rules; State insurance commissioner for state-specific rules.

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Medicare’s Gap Structure: What You’re Covering With Medigap

To understand Medigap value, you first need to understand Medicare’s cost-sharing:

Part A (Hospital) Gaps:

Service	Your Cost in 2026 (approximate)
Inpatient hospital deductible (per benefit period)	~$1,676
Days 1-60 coinsurance	$0
Days 61-90 coinsurance	~$419/day
Lifetime reserve days (91-150)	~$838/day
Beyond 150 days	All costs

Part B (Medical) Gaps:

Service	Your Cost
Annual Part B deductible	~$240
After deductible: coinsurance	20% of approved amount (no out-of-pocket maximum)

Current 2026 figures: verify at medicare.gov as amounts are adjusted annually.

The critical point: original Medicare has no out-of-pocket maximum. A catastrophic illness with a 180-day hospitalization could theoretically cost hundreds of thousands. Medigap caps that exposure.

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Plan G: The Current Gold Standard for New Medicare Enrollees

With Plan F unavailable to those newly eligible since 2020, Plan G has become the most comprehensive option for most new Medigap enrollees.

What Plan G covers:

• Medicare Part A coinsurance and hospital costs (up to 365 additional days after Medicare benefits end)
• Medicare Part A deductible
• Medicare Part A hospice care coinsurance or copayment
• Medicare Part B coinsurance or copayment
• First 3 pints of blood each year
• Medicare Part B excess charges
• Skilled nursing facility care coinsurance (days 21-100)
• Foreign travel emergency (up to plan limits)

What Plan G does NOT cover:

• Medicare Part B deductible (~$240/year) — you pay this out of pocket
• Prescription drugs (need Part D separately)
• Dental, vision, hearing

Annual math on Plan G vs. No supplement:

Scenario	Plan G Premium (hypothetical)	Additional out-of-pocket	Total annual cost
Healthy user (2 doctor visits/year)	$1,800/yr	$240 (Part B deductible only)	~$2,040
Moderate user (Part B coinsurance adds up)	$1,800/yr	$240 + some coinsurance	~$2,200–$3,000
Major hospitalization	$1,800/yr	$240 (Plan G covers rest)	~$2,040

Without Medigap, a single 7-day hospitalization could generate $1,676 (Part A deductible) + daily coinsurance if past day 60 + 20% of all physician services. The protection value compounds with severity.

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Plan F: Still on the Market, But Shrinking

Plan F covers everything Plan G does, plus the Part B deductible (~$240). The catch: because Plan F is closed to anyone eligible for Medicare after January 1, 2020, its risk pool is getting older and sicker over time. This tends to drive premiums higher.

Practical implication: Many people currently enrolled in Plan F are paying $200-$500/month — and premiums are rising faster than Plan G. For Plan F holders who are healthy, switching to Plan G (paying the Part B deductible out of pocket) and pocketing the premium difference is often financially better. However, switching requires underwriting in most states.

Who should keep Plan F: Those in states with guaranteed issue rights (CT, MA, NY), elderly policyholders in poor health who would fail medical underwriting, or those whose Plan F premium is competitive with Plan G after accounting for the Part B deductible difference.

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Plan N: The Budget-Conscious Option

Plan N has grown in popularity for beneficiaries who are relatively healthy and want lower monthly premiums.

What’s different about Plan N:

1. Copayments: Up to $20 for office visits, up to $50 for ER visits (waived if admitted)
2. No Part B excess charge coverage: If you see a non-participating provider, you pay up to 15% above Medicare’s rate
3. Lower premium: Often 15-30% less than Plan G

Who should consider Plan N:

• Generally healthy seniors who see the doctor infrequently
• Those willing to stick exclusively to Medicare-participating providers (avoiding excess charge risk)
• Those who want Medigap protection for catastrophic costs but can absorb modest copayments

Annual math on Plan N vs. Plan G:

• Plan G premium: $2,400/year (hypothetical)
• Plan N premium: $1,800/year (hypothetical)
• Annual premium savings with Plan N: $600
• If you have 30 office visits/year × $20 copay = $600 in copays
• Break-even: If your copayments exceed your premium savings, Plan G is better. If copays are less, Plan N wins.

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The Open Enrollment Trap — Why Timing Is Everything

The Medigap Open Enrollment Period (OEP) is one-time and non-renewable:

• Begins: When you turn 65 AND are enrolled in Medicare Part B
• Duration: 6 months
• Rights during OEP: Guaranteed issue — any Medigap plan available in your area must be sold to you regardless of health conditions

Outside OEP: In most states, insurers use medical underwriting. They can ask about health history, pre-existing conditions, and:

• Charge higher premiums for health conditions
• Exclude pre-existing conditions for up to 6 months
• Deny coverage entirely

State exceptions: California, Connecticut, Massachusetts, and New York have various guaranteed issue rights outside the standard OEP. Check your state insurance commissioner’s rules.

Common mistake: People enroll in Medicare Advantage at 65 (because premiums look attractive), then at age 70 want to switch to Medigap when their health needs increase. By then, they face medical underwriting and may be uninsurable or face very high Medigap premiums.

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Medicare Advantage vs. Medigap: The Real Trade-Off

This is the most consequential insurance decision most seniors make, yet it’s often made by comparing monthly premiums alone.

Factor	Medicare Advantage	Medigap + Original Medicare
Monthly premium	Often $0-$50	$100–$400+
Provider network	Usually required (HMO/PPO)	Any Medicare provider nationwide
Out-of-pocket maximum	Has one (typically $3,000–$10,000/year)	Plan G/F: no out-of-pocket max beyond Part B deductible
Prescription drugs	Often included (Part D embedded)	Need separate Part D
Dental/Vision/Hearing	Sometimes included	Not included
Prior authorization	Common	Rarely required
Referrals	Often required (HMO)	Not required
Best for	Healthy, stable, local care needs	Complex conditions, frequent specialist care, travel

The hidden risk of Medicare Advantage: When serious illness strikes, high out-of-pocket maximums and network restrictions become material. A cancer diagnosis with multiple specialist visits, infusions, and hospitalizations can max out the OOP limit ($6,700 in-network is typical) — and that’s annual, not a one-time cap.

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How to Make the Decision: A Three-Step Framework

Step 1: Assess your health trajectory Are you managing chronic conditions that require frequent specialist care? Have a family history of expensive illness? Or are you generally healthy and planning to use preventive care mainly? Higher expected utilization favors Plan G.

Step 2: Evaluate your financial risk tolerance Can you absorb a $5,000–$10,000 surprise medical bill in a given year without financial stress? If yes, Plan N or even Medicare Advantage may be appropriate. If not, Plan G provides the most predictable expense.

Step 3: Check your state’s underwriting rules If you’re in a guaranteed issue state, you have more flexibility to switch later. In most states, your decision at 65 has long-term consequences — Plan G at enrollment is the safe default.

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Medigap vs. Medicare Advantage: The Financial Breakeven Analysis

Many financial planners debate which is more cost-efficient over a long retirement. Here is a rigorous framework:

Annual total cost comparison (hypothetical):

Cost Item	Original Medicare + Plan G	Medicare Advantage
Part B premium (~$174.70/month in 2024)	$2,096	$2,096
Plan G premium ($180/month hypothetical)	$2,160	—
Medicare Advantage premium ($30/month hypothetical)	—	$360
Expected annual out-of-pocket (moderate user)	~$240 (Part B deductible only)	~$1,500–$3,000 (copays, coinsurance)
Maximum annual exposure	~$240 + Part A if applicable	$3,000–$10,000 (plan OOP max)
Total annual cost (moderate use)	~$4,496	~$3,956
Total annual cost (heavy use/hospitalization)	~$4,500	~$8,000–$12,096

The analysis shows: for moderate to healthy users, Medicare Advantage can be cheaper annually. For heavy users (frequent hospitalizations, multiple specialist visits, chronic disease management), Medigap + Original Medicare typically produces lower total out-of-pocket costs despite the higher premium.

The problem: you can’t know at age 65 which category you’ll fall into at 75. By age 80, statistically, you’re far more likely to be a heavy user — and that’s when the Medigap OEP is long closed and medical underwriting may block you from switching.

This asymmetric risk profile is why most financial planners recommend Plan G for those who can afford it — the extra premium is essentially catastrophic illness insurance.

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The Late Enrollment Penalty — A Permanent Trap

Missing your Medigap OEP is painful. Missing your Medicare Part B enrollment window is worse — it results in a permanent premium penalty.

If you delay enrolling in Part B when first eligible (typically age 65 or when employer coverage ends), you pay a 10% late enrollment penalty for each full 12-month period you were eligible but didn’t enroll. This penalty is permanent and added to your Part B premium for life.

Example: Someone who delays Part B enrollment for 2 full years pays an extra 20% premium surcharge on every Part B premium for the rest of their Medicare coverage — potentially costing thousands of dollars over a long retirement.

Exception: If you have “creditable coverage” from an employer group health plan (employer with 20+ employees), you can delay Part B without penalty while covered. Once that employer coverage ends, you have a Special Enrollment Period (SEP) of 8 months to enroll without penalty.

Trap for early retirees: Retirees who leave employer coverage at age 62-64 and use COBRA or marketplace coverage often mistakenly delay Medicare enrollment at 65, not realizing the penalty clock has started.

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Medigap Pricing Methods — Not All Plans Are Created Equal

Even for the same standardized Medigap plan (e.g., Plan G), the same insurer can use different premium pricing methods that dramatically affect long-term costs:

Community-rated: Everyone in the plan pays the same premium regardless of age. Premiums may increase over time due to inflation and claims, but not because of your age. Best for older enrollees.

Issue-age rated: Premiums are based on your age when you buy the policy. Premiums increase with inflation but not because you’re aging. Good for younger enrollees who can lock in a lower age-based rate.

Attained-age rated: Premiums increase both with inflation AND as you age. Cheapest initially, but premiums can become very expensive in your 70s and 80s. Most common, and often the worst long-term value.

Why this matters: A Plan G from Company A at $100/month (attained-age) may cost less than Company B at $130/month (community-rated) at age 65, but Company A’s premium may be $250+/month by age 80, while Company B’s may be $180. Over 20 years, the cheaper-looking option often costs far more.

Check the pricing method when comparing Medigap plans, not just the current premium.

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Special Enrollment Periods and Guaranteed Issue Rights Outside OEP

Even after the 6-month OEP ends, certain life events trigger Guaranteed Issue Rights — the right to buy a Medigap plan without medical underwriting. These include:

• Your Medicare Advantage plan leaves your service area or discontinues coverage
• You leave a Medicare Advantage plan within the first year (“trial right”)
• Your employer group health plan coverage ends
• Your Medigap insurer goes bankrupt or loses its license
• You move out of your Medicare Advantage plan’s service area

These rights are time-limited (usually 63 days from the triggering event) and allow purchase of specific Medigap plans (not all plans in all states). Being aware of these windows can allow switching to stronger coverage after the OEP without medical underwriting.

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Medicare and Long-Term Care: What Is Not Covered

One of the most financially devastating misunderstandings in retirement planning is the belief that Medicare will pay for long-term care — assisted living, nursing homes, or home health aides for activities of daily living.

What Medicare actually covers:

• Skilled nursing facility (SNF): Only after a 3-day qualifying hospital stay, and only for skilled care (physical therapy, wound care, IV medications). Coverage: 100% for days 1-20, substantial daily copayment for days 21-100, nothing after 100 days.
• Home health: Only for skilled intermittent care (not custodial care) following homebound status.

What Medicare does NOT cover:

• Custodial care (help with bathing, dressing, eating, toileting) — the most common long-term care need
• Assisted living facility costs
• Indefinite nursing home stays beyond 100 skilled nursing days
• In-home caregivers for non-medical tasks

The average long-term care cost: According to industry surveys, the median annual cost for a private nursing home room in the US was approximately $108,000 in 2023 (varies significantly by region). A 3-year stay could cost over $300,000 — entirely out of pocket for Medicare beneficiaries without long-term care insurance.

Solutions:

1. Long-term care insurance (LTCI): Purchased ideally in your 50s or early 60s before health conditions make it uninsurable. Premiums have risen dramatically; hybrid life/LTC policies have become more popular as an alternative.
2. Medicaid: Pays for nursing home care for those who qualify financially. Requires “spending down” assets to state-defined limits (typically $2,000 in countable assets for single individuals, with spouse protections). Medicaid planning with an elder law attorney can preserve some assets.
3. Hybrid products: Life insurance policies with long-term care riders, or annuities with LTC benefit triggers. Premium remains relatively predictable compared to stand-alone LTCI.
4. Self-insurance: If you have substantial assets ($1M+), self-funding is possible. Risk is the possibility of a very long or very expensive care need.

Medigap supplements Medicare — it does not fill the long-term care gap. This is a separate planning need that deserves dedicated attention as part of retirement income planning.

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Geographic Considerations: Medigap and Medicare Advantage Coverage Areas

Where you live — and how much you travel — significantly affects which Medicare option is best.

Original Medicare + Medigap anywhere in the US: Original Medicare pays for care from any provider who accepts Medicare nationwide — no network restrictions. Medigap follows that same freedom. If you see a doctor in Florida, a specialist in Minnesota, and a hospital in New York, all three are covered (as long as they accept Medicare assignment). For frequent travelers, retirees who split time between states (snowbirds), and those with family in different regions, this geographic freedom is a major advantage.

Medicare Advantage network constraints: HMO-type Medicare Advantage plans typically cover only in-network providers except for emergency care. PPO plans offer out-of-network coverage but at higher cost-sharing. If you have a Medicare Advantage plan based in your home county and visit a specialist in another state, you may have limited or no coverage except for genuine emergencies.

The foreign travel caveat: Original Medicare provides no coverage outside the US (with very limited exceptions for Mexico and Canada near the border, and during medical emergencies on cruise ships). Medigap Plans C, D, F, G, M, and N all include foreign travel emergency coverage at 80% after a $250 deductible, up to a lifetime maximum of $50,000. This coverage applies only during the first 60 days of a trip.

Medicare Advantage plans may or may not include foreign travel coverage — check the plan’s Summary of Benefits carefully. For retirees planning extended international travel or living abroad, supplemental travel insurance may be needed regardless of the Medicare product chosen.

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How Medigap Works With Medicare Advantage: You Can’t Have Both

A critical point often misunderstood: you cannot use a Medigap policy while enrolled in Medicare Advantage. Medigap only supplements original Medicare (Parts A and B). If you’re in Medicare Advantage, your Medigap policy is effectively useless (and you shouldn’t be paying for it).

People who originally had Medigap, then switched to Medicare Advantage, must cancel their Medigap policy. The reverse — returning from Medicare Advantage to original Medicare + Medigap — requires medical underwriting in most states outside the OEP.

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Prescription Drug Coverage: Part D Is Not Optional

Seniors who choose original Medicare + Medigap must also enroll in Medicare Part D (prescription drug coverage) separately. Medigap plans do not include drug coverage.

Late enrollment penalty for Part D: Like Part B, there is a permanent late enrollment penalty for Part D — 1% of the national base beneficiary premium (approximately $34/month in 2024-2025) for each full month without creditable drug coverage. This is a small amount per month but compounds over decades.

Choosing a Part D plan:

• Use the Medicare Plan Finder at medicare.gov to find Part D plans in your zip code
• Consider which medications you take and whether they are covered at what tier
• Check network pharmacies — some plans have preferred pharmacies with lower copays
• Annual enrollment period: October 15 – December 7

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Medigap for People Under 65: Disabled Medicare Beneficiaries

People under 65 who are on Medicare (due to Social Security Disability Insurance or end-stage renal disease) face a more difficult Medigap market. Federal law requires states to allow disabled Medicare beneficiaries under 65 to purchase at least one Medigap plan, but only a handful of states go further. Most states allow insurers to refuse coverage or charge dramatically higher premiums for disabled enrollees under 65.

States with stronger protections for under-65 Medigap: California, Colorado, Connecticut, Maine, Massachusetts, Minnesota, New Jersey, New York, Oklahoma, Oregon, Pennsylvania, Washington, and Wisconsin have varying levels of additional protections. Check your state insurance commissioner’s office.

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State-Specific Medigap Rules: Massachusetts, Minnesota, and Wisconsin

Three states have standardized their own Medigap systems differently from the federal standard:

Massachusetts: Offers “core” and “supplement 1” plans instead of lettered plans. Continuously guaranteed issue regardless of health status.

Minnesota: Offers a “Basic” plan and an “Extended Basic” plan. Also has continuous open enrollment.

Wisconsin: Offers a “Basic” plan (similar to Plan A) with various rider options.

Seniors in these states should contact their State Health Insurance Assistance Program (SHIP) — available in every state, free of charge — for guidance specific to their state’s rules.

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For retirees thinking about how insurance costs fit into an overall income strategy, see our posts on dividend income from JPMorgan stock and long-term tax planning for Apple stock holders.

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Disclaimer: This article is for general informational purposes only and is not legal, tax, or insurance advice. Consult a qualified professional for your specific situation.