Original Medicare Has More Cost-Sharing Than Most People Expect
Most people assume Medicare is basically free once they turn 65. It is not. Original Medicare (Parts A and B) comes with deductibles, coinsurance, and cost-sharing gaps that can hit you hard in a bad health year. Understanding exactly where those costs come from is the only way to figure out whether a Medicare Supplement plan is worth it for you.
Let’s start with the two big deductibles in original Medicare, because they work very differently from each other.
Part A (hospital) deductible: In 2026, you pay $1,676 per benefit period before Medicare covers your inpatient hospital costs. That’s not per year. It’s per benefit period, which resets every time you’ve been out of the hospital for 60 consecutive days. If you’re in and out of the hospital twice in a year with enough gap between stays, you could owe that deductible twice. I’ve seen people get blindsided by this, especially people dealing with chronic conditions who think they already paid their “annual” deductible earlier in the year.
Part B (outpatient) deductible: In 2026, you pay $257 before Medicare covers outpatient services like doctor visits, lab work, and durable medical equipment. Once you hit that amount, Medicare pays 80% of approved costs and you’re on the hook for the remaining 20% with no cap. No cap. That’s the part that really matters.
So original Medicare has two separate deductibles, coinsurance on the back end, and zero out-of-pocket maximum. That’s a lot of exposure if you get seriously ill.
How Medicare Supplement Plans Change the Deductible Picture
A Medicare Supplement plan (also called Medigap) wraps around original Medicare to cover some or all of those out-of-pocket costs. The specific deductibles that apply to you depend almost entirely on which plan letter you choose.
Here’s a side-by-side comparison of how the most common Medigap plans handle Medicare’s cost-sharing:
| Cost Type | Original Medicare Only | Plan G | Plan N | High-Deductible Plan G |
|---|---|---|---|---|
| Part A Deductible (per benefit period) | $1,676 | Covered 100% | Covered 100% | You pay until deductible met |
| Part B Deductible (annual) | $257 | You pay $257 | You pay $257 | You pay until deductible met |
| Part B Coinsurance (20%) | You pay 20%, no cap | Covered 100% | Covered (copays apply) | Covered after deductible |
| Part B Excess Charges | You may owe up to 15% more | Covered 100% | Not covered | Covered after deductible |
| Plan Deductible (2026) | None | None | None | $2,870 |
Plan G is the most popular Medigap option for people who turned 65 after January 1, 2020, and it’s popular for a good reason. You pay the $257 Part B deductible once a year, and after that, you have zero exposure on Medicare-approved outpatient costs. The 20% coinsurance disappears. Plan G premiums typically run between $100 and $200 per month at age 65, depending on your state and the insurer. A 65-year-old in Ohio might find Plan G for around $120 a month, while someone in a higher-cost state like New York could pay closer to $180.
High-Deductible Plan G is a different animal. You pay a $2,870 deductible in 2026 before the plan kicks in. After that, your coverage is identical to standard Plan G. The monthly premium is much lower, often under $50 a month, which makes it attractive if you’re healthy and want to bank the difference. I’ll come back to who that actually makes sense for.
The Common Misconception That Costs People Money
Here’s the mistake I see most often, and it’s completely understandable given how confusing this system is: people assume that because they have a Medicare Supplement plan, they have no deductible at all. That’s wrong for every plan except Plan F, which is no longer available to people who became eligible for Medicare after January 1, 2020.
If you’re on Plan G or Plan N, you still owe the 2026 Part B deductible of $257 before your supplement kicks in for outpatient costs. This trips people up in January when they go to their first doctor’s visit of the year and get a bill they weren’t expecting. They call their supplement insurer thinking something went wrong. Nothing went wrong. The plan is working exactly as designed.
The other misconception worth addressing: some people think their Medigap plan has its own separate deductible on top of Medicare’s. For standard Plan G and Plan N, that’s not how it works. There’s no separate “supplement deductible” in those plans. You just owe Medicare’s Part B deductible directly, and your plan covers everything else on the approved cost schedule.
High-Deductible Plan G is where it gets genuinely confusing, because it does have its own plan-level deductible. But that deductible counts the Medicare cost-sharing you pay throughout the year. Once you’ve paid $2,870 total in Medicare-related costs, the plan covers the rest. It’s not a deductible you pay before any coverage starts. Think of it more like an annual out-of-pocket maximum you have to reach before the plan takes over entirely.
When High-Deductible Plan G Actually Makes Sense
I’ll be direct about this: High-Deductible Plan G is not for everyone, and a lot of insurance agents oversell it because the commissions work out favorably for them. That said, for the right person, it’s genuinely smart.
Here’s the math you need to run. If standard Plan G costs you $145 a month and High-Deductible Plan G costs $45 a month, you’re saving $1,200 a year in premiums. The plan deductible is $2,870. So you’d need to have more than $2,870 in Medicare cost-sharing in a given year before High-Deductible Plan G leaves you worse off than standard Plan G.
For someone who goes to the doctor three or four times a year for routine things and isn’t managing serious chronic conditions, the premium savings add up year after year. Over five years, $1,200 in annual savings is $6,000 in your pocket. That covers more than two full years of the plan deductible if you ever hit it.
The people who should not choose High-Deductible Plan G are those who already have significant medical needs, people who would genuinely struggle to pay $2,870 out of pocket if they had a bad health year, and people who simply don’t want the mental stress of tracking costs throughout the year. Predictability has real value. If knowing that a hospital stay won’t cost you anything out of pocket (beyond $257 in January) helps you sleep at night, standard Plan G is worth the higher premium.
How Doctors and Hospitals Actually Bill Through This System
Here’s something people don’t think about until they’re sitting in a doctor’s office: you don’t interact with your Medigap plan at the point of care the way you do with a standard health insurance card. Medicare pays first. Your Medigap plan pays second. In most cases, the billing happens automatically between Medicare and your supplement insurer. You just pay whatever’s left, which on Plan G is essentially nothing after your annual Part B deductible.
One thing worth knowing: any doctor or hospital that accepts Medicare will also accept your Medigap plan. There’s no separate network. That’s one of the biggest advantages of Medigap over Medicare Advantage plans, which typically lock you into a network. With Plan G, you can see any Medicare-accepting provider in the country. For people who travel a lot or split time between states, this matters more than they realize when they’re first choosing a plan.
Part B excess charges are another layer that catches people off guard. If a doctor doesn’t accept Medicare assignment, they can charge up to 15% above Medicare’s approved rate. Original Medicare doesn’t cover that extra amount. Plan G covers it. Plan N does not. If you’re on Plan N and you see a non-participating provider, you could owe that 15% out of pocket. In practice, most doctors do accept assignment, but it’s worth checking before you see a specialist.
Bottom Line
For most people, standard Plan G is the right call. You pay the $257 Part B deductible in 2026 and that’s it. No surprise bills, no tracking costs against a plan deductible, and you can see any Medicare-accepting doctor in the country. High-Deductible Plan G makes sense if you’re in excellent health and genuinely comfortable sitting with financial risk in exchange for lower premiums. If you’re unsure which category you’re in, you’re probably better off with standard Plan G.
Frequently Asked Questions
Does my Medicare Supplement plan have its own deductible?
It depends on which plan you have. Standard Plan G and Plan N don’t have their own plan-level deductibles. You pay Medicare’s Part B deductible ($257 in 2026) and the plan covers the rest of your Medicare-approved costs. High-Deductible Plan G does have a plan deductible ($2,870 in 2026), which you must reach in Medicare cost-sharing before the plan takes over fully.
Why do I still get bills if I have a Medigap plan?
Most likely you’re seeing the Part B deductible early in the year. Every January, your $257 deductible resets. Until you’ve paid that amount in outpatient Medicare costs, you’ll receive bills for covered services. Once you’ve met it, Plan G covers 100% of Medicare-approved outpatient costs for the rest of the year.
Can I get a Medicare Supplement plan with no deductible at all?
Plan F covers the Part B deductible entirely, leaving you with zero deductibles. The catch is that Plan F is only available if you were eligible for Medicare before January 1, 2020. If you turned 65 after that date, Plan F is off the table. Plan G is the closest equivalent, with the only difference being that $257 Part B deductible.
Does the Part A hospital deductible reset every year?
No, and this surprises a lot of people. The Part A deductible resets per benefit period, not per calendar year. A new benefit period begins each time you’ve been out of an inpatient hospital setting for 60 consecutive days. If you’re hospitalized twice in a year with a long enough gap in between, you could owe the $1,676 deductible twice. On Plan G, your supplement covers that deductible both times.