What are Medicare Part B Excess Charges?
What are Medicare Part B Excess Charges is a question we receive often. When a doctor or hospital participate in Medicare, the doctor or hospital can choose whether or not they are willing to accept what is referred to as “Medicare assignment”. When a provider accepts assignment, this means your doctor or hospital accepts the Medicare-approved amount for their services.
Doctors and Hospitals who are not willing to accept assignment can bill you up to 15% over the Medicare-approved amount. This additional out-of-pocket cost is known as a Medicare excess charge. Excess charges can vary from provider to provider but, they cannot exceed the Medicare limiting charge of 15% over “Medicare’s Approved Amount”.
The Medicare limiting charge is the maximum amount a health care provider can charge you for a service that is covered by Original Medicare. Federally, the limiting charge is 15% over Medicare’s approved amount. Providers who do not accept assignment do not have to charge the maximum amount in excess charges. Some providers may only charge 5% or 10% over the Medicare-approved amount.
Medicare Part B excess charges are covered by some Medicare Supplement Plans (Medigap). Medigap plans provide coverage for “gaps” in Original Medicare including copayments, deductibles, and coinsurance. There are ten standard Medicare Supplement Plans, and two high-deductible plans available.
Medigap plans F, G, and their high-deductible versions cover both your Medicare Part B coinsurance and any Part B excess charges. If you have a different Medigap plan, or are only enrolled in Original Medicare, you will need to pay for excess charges out of your own pocket.
How Common are Medicare Part B Excess Charges?
Medicare Part B excess charges are not common; in fact, over 96% of doctors in the U.S. accept Medicare and Medicare assignment. Additionally, there are eight states in the U.S. that do not allow health care providers to bill any excess charges.
Medicare excess charges are uncommon. You should still check with your provider before scheduling an appointment. You can also visit Medicare.gov to search for providers in your area that accept Medicare and Medicare assignment.
Which States Allow Medicare Part B Excess Charges?
Every state in the U.S. other than Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont allow Medicare Part B excess charges. If you live in a state that allows Medicare excess charges, you can find out which providers near you accept Medicare assignment by using Medicare’s Care Compare tool.
Which States Prohibit Medicare Part B Excess Charges?
There are currently eight states in the U.S. that prohibit physicians from billing excess charges. The states that will prohibit Medicare Part B excess charges are:
- Connecticut
- Massachusetts
- Minnesota
- New York
- Ohio
- Pennsylvania
- Rhode Island
- Vermont
How to Avoid Medicare Part B Excess Charges
One of the first things you’ll want to do is contact the health care provider prior to scheduling an appointment. You’ll want to ask if they accept Medicare patients. If a doctor or hospital does not accept Medicare, then you will be responsible for paying the full cost of your service.
If your provider does accept Medicare, you will then simply want to ask if they accept Medicare assignment or Medicare Approved Amount for services. Just remember that accepting assignment means that your doctor accepts the Medicare-approved amount as the full payment for the covered service.
If your health care provider accepts Medicare assignment, then you will not have to pay for any excess charges. You will still be responsible for your deductible and 20% coinsurance, but you will not have any excess charges for the services provided. These charges can be up to 15% over the Medicare-approved amount.
Should You Be Concerned About Medicare Part B Excess Charges?
Medicare excess charges are easy to avoid however, in some cases you may have no other option than to go to a physician who doesn’t accept Medicare assignment. Understanding how those excess charges work can prepare you for the added out-of-pocket expenses.
Joe DeAngelis
We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE (TTY users should call 1 (877) 486-2048) 24 hours a day/7 days a week to get information on all of your options.