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Original Medicare plus a drug plan costs far less per month than adding a supplement — right up until a bad year. Here’s what good, moderate, and high-cost years look like, and why this choice is easier to make early than late.
Published October 23, 2026 · By Erik Roti, Options.Health
Illustrative numbers, not a quote. The figures below use confirmed 2026 Medicare amounts and an assumed Medigap premium of $300 a month. Official 2027 amounts arrive in mid-November and are projected to run modestly higher. This is general information, not financial advice, and your actual costs depend on your care, your carrier, and your plan.
If you’re healthy, skipping a Medigap plan is a real option — just one you should choose with the numbers in front of you. The trade is simple: you keep the premium in your pocket in good years, and you carry the risk in bad ones. Here’s what that looks like.
Original Medicare pays most of your costs, not all of them. Part A has a $1,736 deductible for each benefit period, plus daily coinsurance in long stays ($217 a day in a skilled nursing facility from day 21 to 100). Part B has a $283 annual deductible and then leaves you with 20% of covered outpatient and physician costs — with no annual out-of-pocket maximum. Part D is the one piece that does cap your spending, at $2,100 in 2026 and $2,400 in 2027, and you need a drug plan on this path either way to avoid a late-enrollment penalty. (We covered the hospital side in our Medicare Part A explainer.)
Medigap plans in Minnesota are priced differently by carrier and location — published 2026 quotes run roughly $200 to $330 a month for the Basic plan and $250 to $500 for Extended Basic. At an assumed $300 a month, that’s $3,600 a year. In a light-use year, your cost-sharing under Original Medicare alone might be about $826, which is the Part B deductible plus 20% of a few visits. Against $3,883 for the Medigap path, you’d come out roughly $3,057 ahead. Part B and Part D premiums are the same either way, so they don’t change the comparison.
If you skip the premium, the premium becomes your self-insurance fund. At $300 a month, you’d be setting aside about $3,600 a year. A reasonable starting point is to hold enough in accessible cash to cover a moderate year — roughly $7,000 in our example — and keep adding to it. The honest math is that a high-cost year can cost around $32,000 in exposure, and at $3,600 a year it takes about 9 years of saved premiums to build that cushion. You can’t know which year the big one comes, and it can come in year one.
This is where the 20% with no cap does its damage. Here are three illustrative years side by side, counting only the costs a Medigap plan would have covered, plus the Medigap premium itself:
| Scenario (2026 amounts) | Original Medicare + drug plan only | With Medigap (est.) |
|---|---|---|
| Good year a few visits, about $3,000 in Part B charges | $826 | $3,883 |
| Moderate year one 5-day hospital stay, 10 skilled nursing coinsurance days, about $13,000 in Part B charges | $6,732 | $3,883 |
| High-cost year one hospital stay plus a course of cancer treatment, about $150,000 in Part B charges | $31,962 | $3,883 |
The moderate year is where the math flips: without Medigap you’d be out roughly $2,800 more than with it, even after counting the premium savings. The high-cost year isn’t close. These totals don’t include Part B or Part D premiums, or drug costs, which are the same on both paths, and Extended Basic still leaves you responsible for the Part B deductible.
Most people get a one-time Medigap open enrollment period that starts the month they’re 65 or older and enrolled in Part B and lasts six months. During that window, a carrier can’t turn you down for health reasons. After it ends, in most situations carriers can ask health questions and decline you, charge more, or limit coverage for a condition you already have. The cruel part is the timing: the year you most want a supplement is usually the year a new diagnosis makes it hardest to get one.
There are exceptions, called guaranteed-issue rights, such as losing job-based coverage, or your Medicare Advantage plan leaving your area (we walk through that one in our plan-ending guide). Minnesota has also created a separate guaranteed-issue opportunity for some residents ages 65 to 70, reported to carry a rate surcharge and not to extend past 70 — confirm the current rules before relying on it. Minnesota Medigap pricing is largely based on factors like where you live and tobacco use rather than age, so waiting doesn’t usually raise your premium. The risk of waiting isn’t price. It’s whether you can still qualify at all.
Going without Medigap tends to make sense for people who could absorb a five-figure shock without borrowing, who are in good health, or who have other coverage backing them up. It tends to be a poor fit for people with modest savings, a chronic condition, or a family history that makes a big year more likely. Medicare Advantage is the other option that caps your in-network spending, with the tradeoff of a network. Whichever way you lean, make the decision during your open enrollment window or a guaranteed-issue window, not after you need it.
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No 1-800 numbers and no online quote mills — just licensed Minnesota agents out of our Chaska office who pick up the phone when your plan changes and actually remember your name.
