Medigap Plan K and Plan L in 2027: The Out-of-Pocket Limits Explained

Plan K and Plan L are Medigap plans. People also call them Medicare Supplement plans. They work in a way no other Medigap plan does. Each plan pays just part of your Medicare cost sharing at first. The part you pay adds up bit by bit. Say it hits a set yearly limit. Then the plan pays all of your covered cost sharing. It pays for the rest of that year.

That design keeps the monthly cost down. These two plans tend to cost less each month. Plans that pay in full from the first bill cost more. You trade a lower premium for higher shares. You pay those shares when you use care. But you get a firm stop point for the year. This guide lays out both plans. It lays out the limits for 2026 and 2027. Our Medicare Supplement section holds our other Medigap guides.

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How Plan K and Plan L pay, bill by bill

Both plans pay the same set of benefits. They pay at two different rates. Plan K pays 50% of each item below. Plan L pays 75% of each item below. You pay what is left.

One benefit gets paid in full by both plans. Each plan pays 100% of Part A coinsurance and hospital costs. It pays for up to 365 added days. Those days come after your Medicare hospital benefits run out.

Neither plan pays Part B excess charges. Neither plan pays for foreign travel emergency care. Neither plan pays the Part B deductible. So the first $283 of Part B care in 2026 (Ledger A2) is yours. It is yours on both plans.

• Your Part B coinsurance or copayment.
• The first three pints of blood in each year.
• Your Part A hospice care coinsurance or copayment.
• Your skilled nursing facility care coinsurance.
• Your Part A deductible.

What the yearly limit does

The limit caps your own cost sharing for the year. It does not cap your total bills. Each time you pay a share of a covered cost, it builds toward the limit. Your share is 50% or 25% of the cost. Premiums do not build toward it. Your Medigap premium is a separate bill. Your Part B premium is a separate bill too. Neither one counts.

Say your shares reach the limit. Say you have met the Part B deductible for the year too. Then the plan steps in at 100%. From that point to December 31, the plan pays all covered cost sharing. It pays the cost sharing listed above. Your share for those covered services drops to zero.

The limit resets on January 1. The 2027 limits are $8,360 for Plan K and $4,180 for Plan L (Ledger L2 and L3). They apply to cost sharing you pay in 2027.

Plan K or Plan L: how the choice plays out

Plan L costs more in premium for most buyers. Its limit is about half of Plan K's limit. Say a person uses a lot of care. That person tends to reach Plan L's limit sooner. Each bill leaves a smaller share with the plan holder. The limit itself is lower too. Say a person uses very little care. That person may never reach either limit in a year. For that person, the choice is about two things. It is about the premium and the share rate. Plan K leaves 50% of each bill with you. Plan L leaves 25%.

Neither plan has full first-dollar cover. A plan like Plan G has that kind of cover. Our guide on Plan G vs Plan N shows how the fuller plans pay. Our guide on Plan N copays and costs covers a plan in the middle. That plan sits between these two designs.

Who pays for what

• Medicare (Original Medicare) pays its share first. It pays its share of covered care. For most Part B care, that share is 80% of the approved amount. The share comes after the deductible.
• Medigap (Plan K or Plan L) pays toward the Original Medicare benefit. It pays 50% or 75% of the cost sharing listed above. It pays that share until you reach the yearly limit. It pays 100% after that point. But first you must meet the Part B deductible.
• Medicaid: you may have both Medicare and Medicaid. Then your state may help with premiums and cost sharing. A Medigap policy is a private policy. It is not a Medicaid benefit.
• Private pay: you pay the Medigap premium. You pay the Part B premium of $202.90 a month in 2026 (Ledger A1). You pay the Part B deductible of $283 in 2026 (Ledger A2). You pay your share of each covered bill. You pay that share until you reach the limit.

Sample situation

Maria is 70 and holds Plan L in 2026, when her plan's yearly limit is $4,000 (Ledger L3). In 2027 the same plan's limit rises to $4,180 (Ledger L3, in effect from January 1, 2027). Early in 2026 she pays her Part B deductible of $283 for the year (Ledger A2).

During the year Maria has a hospital stay and a run of outpatient visits. Plan L pays 75% of each cost share, and Maria pays 25%. By September, the shares Maria has paid add up to $4,000. She has met the Part B deductible and reached her limit. For the rest of 2026, Plan L pays 100% of her covered cost sharing. Maria still pays her two premiums each month, because premiums never counted toward the limit.

Questions to ask before you pick Plan K or Plan L

• What is the monthly premium for each plan? Ask for both plans from the same company.
• How much care did you use last year? Add up your shares from that care. Would they have reached either limit?
• Can you pay a share of each bill as it comes? Or do you need costs spread out? A steady premium spreads costs out.
• Does the company sell both plans in your state? How much have its premiums risen in past years?

Sources

• https://www.medicare.gov/health-drug-plans/medigap/basics/compare-plan-benefits