In 2024 more than 65 million Americans had Medicare coverage according to the Centers for Medicare and Medicaid Services. Yet roughly one in four people on Medicare also bought a supplement plan known as Medigap to cover what original Medicare does not pay.
These plans pay for copayments, coinsurance and deductibles that can add up fast. The average couple on Medicare spent more than 11000 dollars out of pocket in 2023 according to a Kaiser Family Foundation report.
Choosing the right supplement plan at the right time can lock in lower premiums for life and protect savings built over decades of work. The window to buy without medical underwriting usually opens when you turn 65 and lasts six months.
Missing that window can make coverage far more expensive or even impossible to obtain.
What Medicare Supplement Plans Actually Cover
Original Medicare pays about 80 percent of approved hospital and medical costs after the deductible. The remaining 20 percent falls on the patient. Medicare supplement plans labeled A through N pay some or all of that 20 percent.
Plan F for example covers the Part A deductible of 1712 dollars in 2025, the Part B deductible of 257 dollars, excess charges and foreign travel emergencies. Plan G offers nearly identical benefits except it does not cover the Part B deductible.
Plan N covers most of the same items but requires copayments of up to 20 dollars for some office visits and 50 dollars for emergency room visits. In 2024 the monthly premium for a 68-year-old male buying Plan G in a medium-cost state averaged 165 dollars according to data compiled by the American Association for Medicare Supplement Insurance.
Premiums vary by age, gender, location and tobacco use.
The Best Time to Buy a Supplement Plan
The federal government guarantees that during the six-month period after you turn 65 and enroll in Part B you can buy any Medicare supplement plan sold in your state without medical questions. Insurance companies cannot deny coverage or charge higher rates based on health conditions during that open enrollment.
After the six months end an insurer may ask health questions and decline applicants with recent heart attacks, cancer or other serious conditions. Data from the Medicare Payment Advisory Commission show that only 42 percent of new Medicare beneficiaries buy a supplement plan in their first year.
Those who wait often pay more or lose the chance entirely. Some states offer additional protections. New York and Connecticut for example allow people to switch plans later with few restrictions.
Popular Plans and Their Costs in 2025
Plan G remains the most purchased Medicare supplement in 2025. It covers the Part A deductible, coinsurance, 80 percent of foreign travel emergencies and all Part B excess charges.
The national average monthly premium for a 65-year-old buying Plan G is about 148 dollars for men and 132 dollars for women according to the 2025 Medicare Supplement Rate Report by Weiss Ratings. Plan N costs roughly 30 percent less but leaves the policyholder responsible for those small copayments.
Plan F is no longer available to people newly eligible for Medicare after January 1 2020. People already enrolled in Plan F may keep it. High-deductible versions of both G and F exist.
The high-deductible Plan G carries a 2800 dollar deductible in 2025 and costs about 60 dollars per month on average yet still protects against truly large bills.
How Household Income Affects Your Choice
Higher-income households often choose Plan G or high-deductible G to minimize future risk. A couple with 120000 dollars in annual retirement income might prefer the certainty of predictable premiums over the uncertainty of medical bills.
Lower-income households sometimes select Plan N to keep monthly costs down. The average annual premium difference between Plan G and Plan N for a 67-year-old couple equals about 780 dollars according to a 2024 study by the Commonwealth Fund.
Over ten years that difference grows to more than 8000 dollars before any claims. Households with substantial savings often view the supplement as true insurance against the possibility of a hospital stay that could cost tens of thousands of dollars.
Steps to Compare and Purchase a Plan
First confirm you have both Part A and Part B in place. Then request rate quotes from at least three insurers in your ZIP code. Use the Medicare.gov plan finder or call the State Health Insurance Assistance Program which offers free unbiased counseling.
Ask each company for its rate history over the past five years. Some insurers have raised premiums by less than 3 percent annually while others have increased rates more than 10 percent in a single year.
Check the financial strength rating from A.M. Best or Weiss Ratings. Finally review the policy for household discounts. Many insurers cut premiums by 5 to 12 percent when both spouses buy from the same company.
Complete the application during your open enrollment window to avoid medical underwriting.
Common Pitfalls to Avoid
Many people buy the first plan they see advertised on television without comparing prices. Rates for the same Plan G can differ by more than 70 dollars per month between companies in the same city.
Others forget that Medicare supplement plans do not cover prescription drugs. A separate Part D plan is required. Some enrollees drop their supplement after a few years when healthy only to discover they cannot buy another one later without answering medical questions.
According to a 2023 Government Accountability Office report nearly 18 percent of people who dropped their Medigap policy later regretted the decision when health changed.
Long-Term Value of the Right Decision
A well-chosen Medicare supplement plan bought at age 65 can remain in force for the rest of your life as long as premiums are paid. Because many plans use attained-age rating your premium will rise each year but not because of new health problems.
The National Association of Insurance Commissioners reports that the average person on Medicare with a supplement plan spends about 30 percent less out of pocket than someone without one. Over twenty years that difference can exceed 50000 dollars.
The peace of mind that comes from knowing a serious illness will not drain retirement savings may be the most valuable benefit of all.
Key Benefits Covered by Popular Medigap Plans
| Benefit | Plan G | Plan N | High-Deductible G |
|---|---|---|---|
| Part A Deductible | Yes | Yes | After $2,800 |
| Part B Coinsurance | Yes | Yes | Yes |
| Part B Deductible | No | No | No |
| Excess Charges | Yes | No | Yes |
| Foreign Travel | 80% | 80% | 80% |
| Office Visit Copay | None | Up to $20 | None |
Selecting the right Medicare supplement plan requires attention to detail but the reward is financial security during years when medical needs often increase. Start by understanding the open enrollment rules, compare real quotes from stable companies and weigh the monthly premium against the potential out-of-pocket costs you could face without coverage.
A few hours spent studying options at age 65 can protect your savings and reduce worry for the rest of your retirement. Many people find that talking with a State Health Insurance Assistance Program counselor removes the confusion and leads to a choice they feel good about for decades.
Sources
- Centers for Medicare and Medicaid Services, 'Medicare Enrollment Dashboard' (2024)
- Kaiser Family Foundation, 'Medicare Out-of-Pocket Spending Trends' (2023)
- American Association for Medicare Supplement Insurance, 'Medigap Enrollment Report' (2024)
- Weiss Ratings, 'Medicare Supplement Insurance Report' (2025)
- Medicare Payment Advisory Commission, 'Report to Congress' (2024)
- U.S. Government Accountability Office, 'Medigap Policy Retention Study' (2023)