Medicare Supplement Plan K is one of two Medicare supplement (Medigap) plans that include a yearly out-of-pocket limit.

Keep reading to learn more about this plan, what it covers, and who might benefit from it.

Sometimes referred to as Medicare supplemental insurance, a Medigap policy helps cover healthcare costs that original Medicare doesn’t cover. For a Medigap plan, you must:

  • have original Medicare, which is Medicare Part A (hospital insurance) and Medicare Part B (medical insurance)
  • have your own Medigap policy (only one person per policy)
  • pay a monthly premium in addition to your Medicare premiums

Medigap policies are sold by private insurance companies. These policies are standardized and follow federal and state laws.

In most states, they’re identified by the same letter, so Medicare Supplement Plan K will be the same, except in the following states:

  • Massachusetts
  • Minnesota
  • Wisconsin

Be aware

It’s illegal for someone to sell you a Medigap policy if you have a Medicare Advantage plan.

Most Medigap policies cover coinsurance after you’ve paid the deductible. Some also pay the deductible.

Coverage with Medicare Supplement Plan K entails:

  • 100% coverage of Part A coinsurance and hospital costs up to an additional 365 days after Medicare benefits are used up
  • 50% coverage of:
    • Part A deductible
    • Part A hospice care coinsurance or copayment
    • blood (first 3 pints)
    • skilled nursing facility care coinsurance
    • Part B coinsurance or copayment
  • Not included in coverage:
    • Part B deductible
    • Part B excess charge
    • foreign travel exchange

The out-of-pocket limit in 2020 is $5,880. After you meet your yearly Part B deductible and your out-of-pocket yearly limit, 100 percent of covered services for the rest of the year are paid by Medigap.

There’s no cap on your annual healthcare costs with original Medicare. People who purchase a Medigap plan typically do so to limit the amount of money spent on healthcare in the course of a year.

This can be important to people who:

  • have a chronic health condition with high costs for ongoing medical care
  • want to be prepared in the event of a highly expensive unexpected medical emergency

What is the other Medigap plan that includes a yearly out-of-pocket limit?

Medicare Supplement Plan K and Medicare Supplement Plan L are the two Medigap plans that include a yearly out-of-pocket limit.

  • Plan K out-of-pocket limit: $5,880 in 2020
  • Plan L out-of-pocket limit: $2,940 in 2020

For both plans, after you meet your yearly Part B deductible and your out-of-pocket yearly limit, 100 percent of covered services for the rest of the year are paid by your Medicare supplemental plan.

Medicare Supplement Plan K is a Medigap policy that helps cover healthcare costs that original Medicare doesn’t cover, including a yearly out-of-pocket limit. Medicare Supplement Plan L is another similar option.

The yearly out-of-pocket limit may be a benefit if you:

  • have a chronic health condition with high costs for ongoing medical care
  • want to be prepared for potentially expensive unexpected medical emergencies

If you feel that a Medigap policy is the right decision for your healthcare needs, be sure to consider all your policy options. Visit Medicare.gov to compare Medigap policies to find what’s right for you.