Medicare Excess Charges: Why They’re Usually Not a Real Problem for Medicare Beneficiaries
If you’ve been researching Medicare Supplement plans, you may have come across something called “Medicare Part B excess charges.”
Some insurance companies and websites make them sound scary. In reality, for most Medicare beneficiaries, excess charges are rare and usually not a major concern.
Here’s what you really need to know.
What Are Medicare Excess Charges?
When you have Original Medicare, doctors and providers bill Medicare for services. Medicare approves a certain amount for each service.
A doctor who does not accept Medicare assignment can legally charge up to 15% more than the Medicare-approved amount for Part B services.
That additional amount is called an excess charge.
Example:
- Medicare-approved amount: $100
- Doctor does not accept assignment
- Doctor charges 15% more
Your excess charge would be:
- $15
That’s it.
Why Excess Charges Are Usually Overblown
Here’s the reality most people never hear:
The Vast Majority of Doctors Accept Medicare Assignment
Most doctors who see Medicare patients accept Medicare assignment, meaning they agree to Medicare’s approved pricing and cannot bill excess charges.
In many areas, excess charges are extremely uncommon.
For many Medicare beneficiaries, they may never encounter one.
Hospitals Cannot Charge Excess Charges
This is another important point people often misunderstand.
Medicare excess charges apply only to certain Part B physician services.
Hospitals themselves do not hit you with Medicare excess charges.
So if you’re hospitalized, this is generally not where excess charges become an issue.
Some States Don’t Allow Excess Charges at All
Several states prohibit Medicare excess charges entirely.
These states include:
- Connecticut
- Massachusetts
- Minnesota
- New York
- Ohio
- Pennsylvania
- Rhode Island
- Vermont
If you live in one of these states, doctors generally cannot bill Medicare excess charges.
That makes the issue even less significant.
Why This Matters When Comparing Plan G vs Plan N
This topic comes up most often when comparing:
Plan G
Plan G pays Medicare excess charges in full.
Plan N
Plan N does not cover excess charges.
Insurance companies often use this difference to push people toward Plan G.
But here’s the question:
Are you paying substantially more every year to protect yourself from a charge you may never encounter?
For many people, Plan N can save meaningful premium dollars year after year while still providing excellent coverage.
The Real-World Experience
In real-world Medicare planning, many beneficiaries on Plan N go years without ever receiving an excess charge bill.
And even if one occasionally occurs, the amount is often relatively small.
That’s why many experienced Medicare brokers believe excess charges should be viewed in perspective — not as a major financial threat.
Should You Ignore Excess Charges Completely?
Not necessarily.
There are situations where they matter more:
- You travel frequently to areas where non-participating providers are more common
- You see specialists who specifically do not accept assignment
- You simply want the most predictable coverage possible
In those cases, Plan G may still make sense.
But for many Medicare beneficiaries, excess charges are far less important than they initially appear.
The Bottom Line
Medicare excess charges sound much scarier than they usually are.
In reality:
- Most doctors accept Medicare assignment
- Excess charges are capped at 15%
- Many beneficiaries never encounter them
- Several states prohibit them entirely
- Paying significantly higher premiums to avoid a rare charge may not always make financial sense
That’s one reason many Medicare beneficiaries choose Plan N over Plan G.
The key is understanding the real risk — not the marketing hype.
Need Help Choosing the Right Medicare Supplement?
Every situation is different. The right Medicare Supplement plan depends on:
- Your budget
- Your doctors
- Your travel habits
- Your long-term premium goals
Working with an experienced independent Medicare broker can help you compare plans objectively and avoid paying for coverage you may not actually need.
Questions About Medicare Supplement Plans?
If you’re turning 65 or comparing Plan G vs. Plan N, we can help you understand your options clearly — without pressure or confusion.
✅ Personalized guidance
✅ Local independent Medicare expertise
✅ Fast answers from a real person
Call Joe DeAngelis today at 215-967-8828
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