Medigap Plan L: 75% Coverage with an Out-of-Pocket Maximum
Medigap Plan L is a cost-sharing plan that covers 75% of most Medicare out-of-pocket costs. It includes an annual cap to protect you from unlimited expenses.
Medigap Plan L is a cost-sharing plan that covers 75% of most Medicare out-of-pocket costs. It includes an annual cap to protect you from unlimited expenses.
Meta Description: Medigap Plan L covers 75% of most Medicare costs with a $4,000 out-of-pocket maximum for 2026. Learn how Plan L works, what it covers, and how it compares to Plan K and Plan G.
Short Description: Medigap Plan L is a cost-sharing plan that covers 75% of most Medicare out-of-pocket costs. It includes an annual cap to protect you from unlimited expenses.
Medigap Plan L offers a middle-ground approach to Medicare Supplement coverage. Instead of covering 100% of your Medicare out-of-pocket costs like Plan G, or 50% like Plan K, Plan L covers 75%—you pay 25%, the plan pays 75%.
The trade-off? Lower monthly premiums than comprehensive plans, plus an annual out-of-pocket maximum that caps your total spending. Once you hit the cap, Plan L covers 100% of your remaining costs for the year.
Plan L and Plan K are the only two Medigap plans that include an out-of-pocket maximum—Original Medicare has no such cap, leaving you potentially exposed to unlimited costs. Plan L offers more coverage than Plan K (75% vs. 50%) with a lower annual maximum ($4,000 vs. $8,000 in 2026), but at a higher premium.
Plan L is a cost-sharing plan, meaning you split certain expenses with your insurance company:
75% coverage: For most covered benefits, Plan L pays 75%, and you pay 25%. For example, if you owe $1,000 in Part B coinsurance, Plan L pays $750, and you pay $250.
100% coverage for some benefits: Plan L 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 L covers 100% of covered services for the rest of the calendar year.
2026 Out-of-Pocket Maximum: $4,000
2025 Out-of-Pocket Maximum: $3,610
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 $4,000 limit (2026), Plan L 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
• Your monthly premiums don't count toward the maximum
Example: Mrs. Smith has Plan L and needs surgery. Medicare pays 80% of the approved amount, and Plan L pays 75% of her remaining 20% share. If her out-of-pocket costs for the year reach $4,000, Plan L begins paying 100% of covered services for the rest of the year.
Like all Medigap plans, Plan L 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 L 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 75%:
Part A deductible: Covers 75% of the Part A hospital deductible ($1,736 per benefit period in 2026). You pay the other 25% ($434).
Part A hospice care coinsurance: Covers 75% of your share of hospice care costs.
Part B coinsurance or copayment: Covers 75% of the 20% coinsurance you typically owe for Medicare-approved services (excluding preventive care, which is covered at 100%).
Skilled nursing facility coinsurance: Covers 75% of the daily coinsurance for skilled nursing stays (days 21-100). In 2026, that's $217/day, so you'd pay about $54.25/day.
Blood (first 3 pints): Covers 75% of the cost of the first three pints of blood you need for a medical procedure.
Plan L 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 L doesn't cover these excess charges. If this concerns you, Plan G covers excess charges.
Foreign travel emergency: Plan L 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 L 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 L vs. Plan K
Both are cost-sharing plans with out-of-pocket maximums, but they differ in coverage levels and caps:
• Plan K: Covers 50% of most costs, $8,000 out-of-pocket maximum (2026), lowest premiums
• Plan L: Covers 75% of most costs, $4,000 out-of-pocket maximum (2026), higher premiums than K
Choose Plan L over Plan K if: You want more coverage (75% vs. 50%) and a lower out-of-pocket cap ($4,000 vs. $8,000), and you're willing to pay higher premiums.
Choose Plan K over Plan L if: You want the lowest possible premiums and are comfortable with higher cost-sharing up to the $8,000 cap.
Plan L vs. Plan G
Plan G is the most popular Medigap plan and covers nearly everything at 100%. Plan L covers most benefits at 75% but has lower premiums and an out-of-pocket cap.
Choose Plan L over Plan G if: You want lower monthly premiums and are comfortable with cost-sharing up to the $4,000 annual maximum.
Choose Plan G over Plan L if: You want predictable costs with minimal out-of-pocket expenses when you use healthcare, and you want foreign travel emergency coverage and Part B excess charge protection.
Plan L 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 but includes foreign travel emergency coverage.
Choose Plan L over Plan N if: You want an out-of-pocket cap that limits your total annual spending to $4,000.
Choose Plan N over Plan L if: You prefer higher coverage percentages (100% vs. 75%) with small, predictable copays, and want foreign travel emergency coverage.
Plan L may be a good fit if:
• You want a middle ground between Plan K's 50% coverage and Plan G's 100% coverage
• You want protection against catastrophic costs (the $4,000 annual cap)
• You're comfortable sharing 25% of most Medicare costs
• You want lower premiums than Plan G but more coverage than Plan K
• You don't travel internationally or don't need foreign travel emergency coverage
Plan L may NOT be right if:
• You have ongoing health conditions requiring frequent medical care (Plan G's 100% coverage may cost less overall)
• You prefer predictable costs and don't want to pay 25% 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 L, consider your total potential costs for the year:
Best-case scenario (minimal healthcare use): You pay moderate monthly premiums plus the $283 Part B deductible (2026), and very little else. Plan L's lower premiums (compared to Plan G) save you money.
Worst-case scenario (high healthcare use): You pay monthly premiums plus the Part B deductible ($283) plus up to $4,000 out of pocket. After reaching $4,000, Plan L covers 100% for the rest of the year.
Comparison math: If Plan G costs $150/month and Plan L costs $100/month, you save $600/year in premiums with Plan L. But if you hit Plan L's $4,000 out-of-pocket maximum, your total spending is higher than Plan G (where you'd only pay the $283 Part B deductible). Plan L works best if you stay healthy or have moderate healthcare costs.
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 L, Plan K, 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, coverage percentages, and out-of-pocket maximums.
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 L out-of-pocket maximum for 2026?
The Plan L out-of-pocket maximum for 2026 is $4,000 (up from $3,610 in 2025). Once you've paid this amount out of pocket during the calendar year, Plan L covers 100% of covered services for the rest of the year. CMS sets this limit and increases it annually.
How does Medigap Plan L's 75% coverage work?
For most covered benefits, Plan L pays 75%, and you pay 25%. For example, if you have a $1,000 skilled nursing facility bill, Plan L pays $75,0 and you pay $250. However, some benefits are covered at 100%, including Part A hospital coinsurance and Part B preventive care.
What's the difference between Plan K and Plan L?
Both are cost-sharing plans with out-of-pocket maximums. 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 provides more coverage and a lower annual maximum.
Is Plan L or Plan G better?
It depends on your health and budget. Plan L has lower premiums, but you share costs 75/25 until you hit the $4,000 cap. Plan G has higher premiums but covers nearly everything at 100% (you only pay the $283 Part B deductible). Plan G also covers Part B excess charges and foreign travel emergency—Plan L doesn't. If you expect high medical expenses, Plan G may actually cost less overall.
Does Plan L 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 L cover Part B excess charges?
No. Plan L 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%.
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