Key Takeaways

• Medigap plans can protect you from the most unpredictable and costly gaps left by Original Medicare, such as hospital deductibles, coinsurance, and extended inpatient stays.

• Understanding what each plan covers now, in 2025, helps ensure you are not caught off guard by expenses Medicare doesn’t fully cover, especially as healthcare needs grow with age.

Medicare’s Gaps Can Catch You Off Guard

Original Medicare (Parts A and B) offers solid foundational coverage, but it doesn’t pay for everything. In 2025, you still face deductibles, copayments, and coinsurance that can stack up quickly. A few examples of the gaps include:

• Part A hospital deductible: $1,676 per benefit period

• Part B annual deductible: $257

• Part B coinsurance: 20% of Medicare-approved costs

Without additional coverage, these amounts come directly out of your pocket. That’s where Medigap, also known as Medicare Supplement Insurance, plays a key role.

What Medigap Plans Are Designed to Cover

Medigap plans are designed to fill in the cost gaps left behind by Original Medicare. They are standardized, meaning each plan (like Plan G or Plan N) offers the same benefits no matter which provider you purchase from. What varies is the cost and customer experience.

In 2025, the most common Medigap benefits include:

• Coverage of the Part A hospital deductible

• Coverage of Part B coinsurance

• Additional coverage for skilled nursing facility care coinsurance

• Foreign travel emergency care (up to plan limits)

The goal of a Medigap plan is not to duplicate Medicare but to make your Medicare coverage more predictable.

The Big Financial Surprises That Medigap Can Help You Avoid

1. Unexpected Hospital Admissions

A sudden hospital stay can cost thousands. In 2025, you pay the full Part A deductible before Medicare covers inpatient services. If you are admitted multiple times in different benefit periods, you could owe this amount more than once in a year.

Certain Medigap plans pay this deductible entirely, helping you avoid this major expense.

2. Prolonged Stays and Skilled Nursing Facility Costs

Medicare only covers limited skilled nursing care following a qualifying hospital stay, and coinsurance kicks in after day 20. By day 21, you’re responsible for $209.50 per day.

Medigap plans often cover all or most of this skilled nursing coinsurance. This protection becomes especially important after surgery or a medical event requiring rehabilitation.

3. The 20% Coinsurance for Outpatient Care

After meeting your Part B deductible, you’re still responsible for 20% of all outpatient care costs, including:

• Doctor visits

• Lab work

• Imaging

• Outpatient surgery

For expensive procedures or chronic conditions requiring regular visits, this 20% adds up quickly. Medigap helps limit this financial burden.

4. Emergency Care While Traveling Abroad

Medicare generally doesn’t cover healthcare outside the U.S., leaving you fully responsible for emergencies while abroad. Many Medigap plans include foreign travel emergency coverage, up to plan limits, offering added peace of mind if you travel.

5. Coverage Gaps from Excess Charges

Some providers charge more than what Medicare approves, called “excess charges.” This happens under Part B and can result in out-of-pocket costs if you see providers who don’t accept Medicare assignment.

Plans like Medigap Plan G cover these excess charges, helping you avoid paying more than the Medicare-approved amount.

Why These Costs Matter More as You Age

Healthcare needs change with age. Even if you rarely visit the doctor today, you may need more frequent care in your 70s or 80s. And while Medicare adjusts coverage limits annually, out-of-pocket expenses are still a major concern.

Increased medical visits, testing, and prescriptions make the financial protection of Medigap more valuable over time. Rather than guessing what each service will cost you, a Medigap plan gives you a clearer picture of your obligations.

Choosing the Right Plan for Protection

There are several standardized Medigap plans to choose from. In 2025, the most popular include:

• Plan G: Offers comprehensive coverage, excluding only the Part B deductible.

• Plan N: Covers many of the same benefits as Plan G, but you pay copays for certain visits and may face excess charges.

When comparing plans, consider:

• Your current health needs

• Your budget for monthly premiums

• Your willingness to handle some out-of-pocket costs

Remember, once you choose a Medigap plan, it doesn’t cover prescription drugs. You’ll need a separate Part D plan for that.

The Value of Guaranteed Issue Rights

You don’t always have the right to buy a Medigap plan without answering health questions. However, you do have a guaranteed issue right in these situations:

• When you first turn 65 and enroll in Medicare Part B

• If you lose other coverage through no fault of your own

During these windows, insurance companies must sell you a plan and cannot charge more based on your health.

Timing Can Impact Your Access

The best time to enroll in a Medigap plan is during your Medigap Open Enrollment Period, which lasts for 6 months starting the month you turn 65 and enroll in Medicare Part B. During this time:

• You cannot be denied coverage

• You are guaranteed the best available rate

If you miss this period, you may be subject to medical underwriting, and acceptance isn’t guaranteed.

Medigap vs. Medicare Advantage: Different Approaches

Some people choose Medicare Advantage (Part C) instead of Original Medicare with a Medigap plan. But these paths are not interchangeable.

• Medigap works with Original Medicare and focuses on reducing out-of-pocket expenses.

• Medicare Advantage replaces Original Medicare and may offer extras like vision or dental, but typically has provider networks and different cost-sharing rules.

If avoiding unexpected costs is your priority, Medigap may offer more predictable financial protection, especially when paired with freedom to see any Medicare-participating doctor.

Don’t Wait for a Crisis to See the Value

Medigap is about planning ahead. Waiting until your health changes may limit your options or increase your premiums. Many people make the mistake of delaying supplemental coverage because they feel healthy now, only to face higher costs or medical underwriting later.

Protecting yourself early can lead to long-term stability and fewer surprises when your healthcare needs increase.

What You Don’t Get with Medigap

It’s important to understand what Medigap does not cover, so your expectations are realistic. Medigap plans do not include:

• Prescription drug coverage (Part D)

• Vision, dental, or hearing care

• Long-term custodial care (nursing home care)

While Medigap offers financial predictability for hospital and medical services, you may still need to build other plans around these gaps, such as standalone Part D or dental plans.

Planning in 2025 and Beyond

In 2025, healthcare costs are continuing to rise, and Medicare remains the cornerstone of retiree health coverage. But relying on Original Medicare alone can leave significant financial exposure. The limits on what Medicare pays aren’t changing dramatically, which makes having a Medigap plan just as important today as in years past.

Medigap plans don’t change as frequently as other parts of Medicare, which makes them a reliable tool in your long-term retirement healthcare strategy. Once you’re enrolled, your benefits remain consistent as long as you pay your premium.

Strengthen Your Coverage With Confidence

Choosing a Medigap plan means choosing financial protection, especially from Medicare’s biggest blind spots like hospital costs, coinsurance, and prolonged care. By understanding your options now, you can avoid the stressful and expensive surprises that catch many people off guard.

If you’re ready to explore how Medigap can support your healthcare planning, speak with a licensed agent listed on this website. They can help match your needs with the right plan.