How Supplemental Coverage Affects Out-of-Pocket Costs

Cassidy Clark
Jul 13
2 min read

How Supplemental Coverage Affects Out-of-Pocket Costs

One of the most common questions people have about Medicare is: what will I actually owe? The answer depends significantly on whether, and how, you supplement your Original Medicare coverage.

What You Owe Under Original Medicare Alone in 2026

Without supplemental coverage, here's what the numbers look like:

Part B Premium: $202.90/month for most beneficiaries in 2026
Part B Deductible: $283 annually for 2026. After that, you pay 20% of Medicare-approved costs for most outpatient services
No Cap on 20% Coinsurance: There is no annual out-of-pocket limit under Original Medicare alone
Part A deductible: $1,736 per inpatient benefit period for 2026

That uncapped 20% is what concerns many people, and rightfully so. A serious illness or extended hospital stay can generate costs that add up quickly.

How Medigap Plans Help

This is the core problem that Medigap (Medicare Supplement) plans are designed to solve. Depending on the plan letter you select, a Medigap policy may cover:

Your Part A deductible
Your Part B deductible
Your Part B coinsurance
Copayments
Emergency care when traveling abroad (select plans)

High coverage plans like Plan G or Plan N can significantly reduce what you owe out of pocket during a medical event.

Example - Plan G in Action:

A beneficiary with Original Medicare + Plan G pays the annual Part B deductible. After that, Plan G covers 100% of Part A copays and Part B coinsurance, meaning that copays and 20% coinsurance is no longer their responsibility. For someone with regular specialist visits or outpatient procedures, that can mean meaningful savings over time.