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Medicare Supplement Plan N: How Does It Work?

What is Medicare Supplement Plan N?

Medicare Plan N is one of several Medigap plans (also known as Supplemental plans) available from private insurance companies that will pay additional healthcare costs not covered by Medicare Part A and Part B (original Medicare).

Medigap plans are identified by letters A through N. Plans E,F, H, I, and J are no longer offered to new subscribers. People can enroll in Plans A, B, C, D, G, K, L, M, and N.

Plan F stopped taking new members for 2020. Each letter represents a different level of coverage.

People often confuse the fact that Medigap Plans A, B, C, and D are the same as Medicare Parts A, B, C, and D. They are not.

Medicare has four parts. Medigap policies are referred to as plans. So, the correct way to refer to this policy is Medigap Plan N or Medicare Supplement Plan N, and not Medicare Part N.

Each lettered plan is different in terms of coverage and costs. Several plans are offered to allow maximum flexibility in choosing a plan that is the best for your healthcare needs.

Typically, Plan N is popular with people who want to pay a lower premium in exchange for paying a small annual deductible and some copays.

Medicare Supplement Plan N coverage

Medicare Supplement Plan N covers:

Part A deductible. In 2020, this amount is $1,408.

Part A hospital and coinsurance costs. You will be covered for the remaining 20% obligation, up to an additional 365 days after Medicare benefits are used.

Part A hospice coinsurance and copayments at any certified hospice center.

Part B coinsurance and copayments. Plan N covers 20% of the coverage that Medicare Part B does not. It also pays for all your hospital copays, coinsurance, and your deductible. You will need to pay excess charges the Part B deductible and a few small copays at your doctor’s office and if you visit the emergency room.

Coverage also includes ambulance services, surgeries, lab work, and imaging tests, as well as durable medical equipment. You may have to pay $20 for some office visits and up to $50 for emergency room visits, which will be waived if you are admitted.

Foreign travel emergencies up to the plan limits, along with a $250 deductible.

Blood transfusions up to three pints.

Skilled nursing facility coinsurance.

What Medicare Plan N Doesn’t Cover

Plan N does not cover the Medicare Part B deductible or Part B excess charges. If excess charges are a concern, consider a Plan G policy instead.

With Plan N, 100% of Part B coinsurance expenses are covered, with the exception of up to a $20 copayment for office visits and up to $50 for emergency room visits. If these are coverages are important to you, consider a Plan D policy instead because they are covered entirely under that plan.

This might make better sense for people who have frequent copayments for doctor or emergency room visits.

Prescription drugs are also not covered under Plan N. With few exceptions, you must also purchase a Medicare Part D policy to specifically cover most prescription drug situations.

Medigap Plan N Costs

In exchange for paying a lower premium, you’ll have to pay for a few things that are covered by other plans. For example, you’ll pay the Part B deductible of $198 in 2020. You may also have copayments of up to $20 for doctor appointments and $50 copayments for emergency room visits if you’re not admitted.

You will also have to pay Part B excess charges, which are up to 15% of what Medicare paid for a service or a product. That only applies if your medical provider does not accept Medicare assignment rates.

You can get ahead of this potential cost by asking your medical provider upfront if they accept Medicare assignment rates.

Your monthly premium will depend on several things, such as your age, gender, zip code, and whether or not you smoke.

Benefits for all Medigap plans have been standardized since 1991. That means the Plan N benefits offered by one insurance provider will be the same as they will be for any other Plan N provider.

By comparison, plans F and G do cover excess charges.

Standardization also includes the same doctors’ networks. Medigap insurance companies do not have their own networks because their plans are only supplemental to your Part A and Part B coverage.

Overall, 93% of primary care physicians accept Medicare, and no matter which Plan N policy you choose, you’ll have access to the entire Medicare network.

Claims processing has also been standardized. When you receive services, your medical provider will submit your claim to Medicare and not your supplement plan insurance company.

Medicare uses a clearinghouse to process claims. After a claim is approved, Medicare will pay your medical provider and notify your supplement provider of the remaining claim amount.

This standardization makes pricing for Plan N policies a primary consideration. It really comes down to finding a highly rated provider with the best price.

One final thing to consider…always make sure you are comparing the same plan letters from company to company. You do not want to get a Plan G quote from one company and compare it to a Plan N quote from another.

If you’re shopping for Plan N, make sure you are quoted specifically for Plan N at all companies. If not, the benefits are different, and that will alter the cost of the policy.

Medicare Plan N Eligibility

To be eligible for enrollment in any Medicare supplement plan, you must be enrolled in Medicare Part A and Part B. You must also live in a plan’s service area.

Most states do not require private insurance providers to sell plans to beneficiaries under age 65. So, if you qualify for Medicare benefits because you have End-Stage Renal Disease, ALS, or you are getting Social Security Disability payments, but you’re under 65 years old, there’s a good chance you can be denied for a Medigap plan.

Enrollment in Medigap Plan N

You can enroll in Plan N at any time, but your best bet is to enroll during your Initial Enrollment Period. This is a six-month window that starts with the effective date of your Part B coverage. That is because you enjoy the added benefits of enrolling in any plan in your area without being denied or charged more due to pre-existing conditions.

Medicare Supplement Plan N Reviews

With standardized benefits, networks, and payment processing, insurance companies that sell policies are highly rated primarily due to price, stability, and customer service responsiveness.

Taking these elements into consideration, here are some of the top searched Medigap carriers offering Plan N policies.

  • Aetna
  • Amerigroup
  • Cigna
  • Humana
  • Mutual of Omaha

How does Medigap Plan N compare to other plans?

To help you decide if Medigap Plan N is right for you, here’s a side-by-side comparison of all supplemental plan benefits.

Medigap Plan N insurance companies

Companies use one of three methods to price Plan N policies. It’s helpful to know which price rating system is used so that you can better understand the quote you receive and the reasoning used to arrive at the premium cost.

The pricing methods include:

Community-rated. All policyholders pay the same regardless of their age. Pricing does not increase due to your age, but premiums can still be adjusted based on inflation.

Issue-age-related. Premium costs are based on your age at the time you buy a policy. The younger you are when you buy a plan, the cheaper the premium. The premium also can’t increase after a policy is issued due to your age.

Attained-age-related. As you get older, your premium costs go up.

Is Medigap Plan N right for you?

Here are a few things to consider if you’re weighing enrollment in a Plan N policy:

  • You must already be enrolled in Medicare Part A and Part B.
  • You can have a Part C Medicare Advantage policy or a Medigap policy, but you can’t have both at the same time.
  • Medigap Plan N is similar in coverage to Plan F but is generally less expensive, making it an attractive alternative for many people. Be aware that Plan F is no longer offered to new members as of January 1, 2020.
  • Each Medigap policy only covers one person. If you and your spouse both want Plan N coverage, you’ll need to buy two policies. In some cases, it makes sense to purchase a different Medigap plan for your spouse.
  • In most cases, you’ll get to keep your current doctors. Be sure to check with your providers to make sure they except the same Medigap policy you want to buy.
  • Medigap policies are guaranteed renewable. That means your coverage can’t be canceled as long as you stay current with your premium payments.
  • The two times you can buy any Medigap policy and be eligible without any medical underwriting or worry about pre-existing conditions are during your Initial Enrollment Period and if you’re over 65 and you lose your employer coverage. In both instances, you’ll have a 6-month window to purchase a policy with these advantages.
  • If you want to drop your current Medigap coverage in favor of a different Medigap policy, or you want to enroll in a Part C policy instead, you could be subject to a late enrollment penalty, if:
  • There is a gap of 63 days or more before your new Medicare coverage begins.
  • Plan N covers health care issues when traveling out of the United States. That includes emergency care for in the first 60 days of travel outside the country, and Plan N will pay for 80% of treatment costs.

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