Medigap Plan K: Lower Premiums with an Out-of-Pocket Maximum
Medigap Plan K is a cost-sharing plan with lower premiums. It covers 50% of most Medicare out-of-pocket costs, with an annual cap that limits your total spending.
Medigap Plan K is a cost-sharing plan with lower premiums. It covers 50% of most Medicare out-of-pocket costs, with an annual cap that limits your total spending.
Medigap Plan K takes a different approach than most Medicare Supplement plans. Instead of covering 100% of your Medicare out-of-pocket costs, Plan K covers 50%—you pay half, the plan pays half. In exchange for this cost-sharing, you get lower monthly premiums.
The key feature that makes Plan K unique is its annual out-of-pocket maximum. Once you've paid a certain amount out of pocket during the year, the plan covers 100% of your remaining costs. This cap protects you from unlimited expenses while keeping your premiums affordable.
Original Medicare (Parts A and B) has no out-of-pocket maximum at all—your costs could theoretically be unlimited. Plan K gives you that protection at a lower premium than comprehensive Medigap plans like Plan G.
Plan K is a cost-sharing plan, meaning you split certain expenses with your insurance company:
50% coverage: For most covered benefits, Plan K pays 50%, and you pay 50%. For example, if you owe $1,000 in Part B coinsurance, Plan K pays $500, and you pay $500.
100% coverage for some benefits: Plan K covers 100% of Part A coinsurance and hospital costs (including up to 365 additional days after Medicare benefits are exhausted) and 100% of Part B preventive care coinsurance.
Out-of-pocket maximum: After you've paid the maximum amount out of pocket for the year, Plan K covers 100% of covered services for the rest of the calendar year.
2026 Out-of-Pocket Maximum: $8,000
2025 Out-of-Pocket Maximum: $7,220
The Centers set this limit for the Centers for Medicare & Medicaid Services (CMS) and increase it each year based on Medicare cost growth.
How the out-of-pocket maximum works:
• Your insurance company tracks your out-of-pocket spending throughout the year
• Once you reach the $8,000 limit (2026), Plan K pays 100% of covered services for the rest of the calendar year
• The limit resets each January 1
• You must also meet the Part B deductible ($283 in 2026) before the out-of-pocket maximum kicks in
Important: Plan K and Plan L are the only Medigap plans with an out-of-pocket maximum. Plan L has a $4,000 maximum for 2026 but covers 75% of costs instead of 50%.
Like all Medigap plans, Plan K benefits are standardized—the coverage is the same regardless of which insurance company sells it.
Covered at 100%:
Part A coinsurance and hospital costs: Covers 100% of the coinsurance for hospital stays. In 2026, that's $434/day for days 61-90 and $868/day for lifetime reserve days.
Additional 365 days of hospital coverage: After you've exhausted your Medicare hospital benefits, Plan K covers 100% of hospital costs for up to an additional 365 days.
Part B preventive care coinsurance: Covers 100% of the coinsurance for Medicare-covered preventive services.
Covered at 50%:
Part A deductible: Covers 50% of the Part A hospital deductible ($1,736 per benefit period in 2026). You pay the other 50% ($868).
Part A hospice care coinsurance: Covers 50% of your share of hospice care costs.
Part B coinsurance or copayment: Covers 50% of the 20% coinsurance you typically owe for Medicare-approved services (excluding preventive care, which is covered at 100%).
Skilled nursing facility coinsurance: Covers 50% of the daily coinsurance for skilled nursing stays (days 21-100). In 2026, that's $217/day, so you'd pay about $108.50/day.
Blood (first 3 pints): Covers 50% of the cost of the first three pints of blood you need for a medical procedure.
Plan K has some notable gaps compared to more comprehensive Medigap plans:
Part B deductible: You pay the full Part B annual deductible yourself ($283 in 2026). No Medigap plan available to new Medicare beneficiaries covers this.
Part B excess charges: If a doctor doesn't accept Medicare assignment, they can charge up to 15% more than the Medicare-approved amount. Plan K doesn't cover these excess charges. If this concerns you, Plan G covers excess charges.
Foreign travel emergency: Plan K provides no coverage for emergency medical care when traveling outside the United States. Plans C, D, F, G, M, and N include this benefit.
Prescription drugs: Like all Medigap plans, Plan K does not cover prescription drugs. You'll need a separate Medicare Part D plan.
Dental, vision, and hearing: Not covered by any Medigap plan.
Plan K vs. Plan G
Plan G is the most popular Medigap plan and covers nearly everything at 100%. Plan K covers most benefits at 50% but has lower premiums and an out-of-pocket cap.
Choose Plan K if: You want lower monthly premiums and are comfortable with cost-sharing up to the $8,000 annual maximum.
Choose Plan G if: You want predictable costs with minimal out-of-pocket expenses when you use healthcare.
Plan K vs. Plan L
Plan L is similar to Plan K but covers 75% of costs instead of 50%. Plan L has a lower out-of-pocket maximum ($4,000 in 2026) but higher premiums than Plan K.
Choose Plan K if: You want the lowest possible premiums and are comfortable with higher cost-sharing.
Choose Plan L if: You want a middle ground between Plan K's 50% coverage and Plan G's 100% coverage.
Plan K vs. Plan N
Plan N covers most costs at 100% but has copays (up to $20 for doctor visits, up to $50 for ER visits not resulting in admission). Plan N has no out-of-pocket maximum.
Choose Plan K if: You want an out-of-pocket cap that limits your total annual spending.
Choose Plan N if: You prefer higher coverage percentages with small, predictable copays.
Plan K may be a good fit if:
• You want lower monthly premiums than comprehensive plans like G or N
• You're comfortable with 50% cost-sharing on most Medicare expenses
• You want protection against catastrophic costs (the $8,000 annual cap)
• You're relatively healthy and don't expect high medical expenses most years
• You don't travel internationally or don't need foreign travel emergency coverage
Plan K may NOT be right if:
• You have ongoing health conditions requiring frequent medical care
• You prefer predictable costs and don't want to pay 50% of your Medicare expenses
• You travel outside the U.S. and want emergency coverage abroad
• You see doctors who may charge Part B excess fees
When evaluating Plan K, consider your total potential costs for the year:
Best-case scenario (minimal healthcare use): You pay low monthly premiums plus the $283 Part B deductible (2026), and very little else. Plan K's low premiums save you money.
Worst-case scenario (high healthcare use): You pay monthly premiums plus the Part B deductible ($283) plus up to $8,000 out of pocket. After reaching $8,000, Plan K covers 100% for the rest of the year.
Compare this to Plan G: higher monthly premiums, but you only pay the $283 Part B deductible out of pocket each year. If you expect significant medical expenses, Plan G's higher premiums cost less than Plan K's premiums plus cost-sharing.
Remember: You also pay the Medicare Part B premium ($202.90/month standard in 2026) regardless of which Medigap plan you choose.
Choosing between Plan K, Plan L, Plan G, Plan N, and other Medigap options depends on your health, budget, and the level of risk you're comfortable with. A lower premium isn't always the best deal if you end up paying more in cost-sharing.
At Health Plans of NC, our licensed agents can help you compare the total costs of different Medigap plans based on your situation. We'll help you understand the trade-offs between premiums and out-of-pocket costs.
Contact us at 1-800-797-0327 for a free Medigap consultation. We're locally based in North Carolina and can help you find the right coverage for your needs and budget.
What is the Medigap Plan K out-of-pocket maximum for 2026?
The Plan K out-of-pocket maximum for 2026 is $8,000 (up from $7,220 in 2025). Once you've paid this amount out of pocket during the calendar year, Plan K covers 100% of covered services for the rest of the year. CMS sets this limit and increases it annually.
How does Medigap Plan K's 50% coverage work?
For most covered benefits, Plan K pays 50%, and you pay 50%. For example, if you have a $1,000 skilled nursing facility bill, Plan K pays $500, and you pay $500. However, some benefits are covered at 100%, including Part A hospital coinsurance and Part B preventive care.
Is Plan K or Plan G better?
It depends on your health and budget. Plan K has lower premiums, but you share costs 50/50 until you hit the $8,000 cap. Plan G has higher premiums but covers nearly everything at 100% (you only pay the $283 Part B deductible). If you're healthy and want lower premiums with catastrophic protection, Plan K may work well. If you want predictable, minimal out-of-pocket costs, Plan G is the better choice.
Does Plan K cover prescription drugs?
No. No Medigap plan covers prescription drugs. If you need drug coverage, you must enroll in a separate Medicare Part D plan. In 2026, Part D has a $2,100 out-of-pocket maximum, after which you pay nothing for covered drugs.
Does Plan K cover Part B excess charges?
No. Plan K does not cover Part B excess charges (when doctors charge up to 15% above Medicare-approved amounts). If you want protection from excess charges, consider Plan G, which covers them at 100%.
What's the difference between Plan K and Plan L?
Both are cost-sharing plans with out-of-pocket maximums, but Plan K covers 50% of most costs with an $8,000 cap (2026), while Plan L covers 75% of most costs with a $4,000 cap. Plan L has higher premiums than Plan K but lower cost-sharing and a lower annual maximum.