An excess charge happens when you receive health care treatment from a provider who does not accept the Medicare-approved amount as full payment. In these cases, a provider can charge you up to 15% more than the Medicare-approved amount.
There are some ways you can avoid paying Part B excess charges, and you may be able to find a Medicare Supplement Insurance (Medigap) plan that can cover these charges.
When a doctor, health care provider or a supplier of durable medical equipment (DME) accepts Medicare assignment, it means that the Medicare-approved amount as full payment.
The Medicare-approved amount is the amount of money that Medicare has determined it will reimburse a provider for a given service or item. The Medicare-approved amount may be lower than what the provider actually charges for the treatment.
Part B covers doctor’s appointments and other types of outpatient care along with durable medical equipment. Part B excess charges will only occur if you visit a provider or a DME supplier who doesn’t accept Medicare assignment.
Any health care provider who accepts Medicare as a form of insurance (but doesn’t accept assignment) and is offering a service or item covered under Part B reserves the right to make excess charges.
This can include:
Most physicians, health care providers and medical suppliers accept Medicare assignment, so Part B excess charges are not that common.
In 2015, 93 percent of primary care physicians accepted Medicare assignment.1
The following example illustrates how Part B excess charges can work.
If you did not face any Part B excess charges and you had already met your Part B deductible for the year, your share of the same bill would be just $60.
The easiest way to avoid facing Medicare Part B excess charges is to limit yourself to visiting providers and medical suppliers who accept Medicare assignment. As mentioned above, most providers and physicians accept Medicare assignment.
Be sure to ask your provider, device supplier or physician if they accept Medicare assignment before receiving any treatment or services.
There are also other ways you may be able to avoid paying Medicare Part B excess charges.
Some states do not allow Part B excess charges
There are eight states that have laws in 2020 prohibiting Medicare Part B excess charges.
These states are:
Some Medicare Supplement Insurance (Medigap) plans cover Part B excess charges
Another way to protect yourself against Part B excess charges is to enroll in a Medicare Supplement Insurance plan that covers these charges.
Medigap plans provide coverage for many of the out-of-pocket expenses Medicare Part A and Part B (Original Medicare) don’t cover.
These costs can include deductibles, coinsurance, copayments and more.
There are 10 standardized Medigap plans available in most states. Three of these plans provide 100 percent coverage of Part B excess charges:
Such a benefit allows you to freely visit Medicare providers without worry if they are participating or non-participating providers. Any excess charges they file will be picked up by your Medigap plan.
You can use the chart below to compare the types of standardized Medigap plans and the benefits they offer.
|Medicare Supplement Benefits||A||B||C||D||F||G||K||L||M||N|
|Part A co-insurance and hospital costs||✓||✓||✓||✓||✓||✓||✓||✓||✓||✓|
|Part B co-insurance or co-payment||✓||✓||✓||✓||✓||✓||50%||75%||✓||✓|
|First 3 pints of blood||✓||✓||✓||✓||✓||✓||50%||75%||✓||✓|
|Part A hospice care co-insurance or co-payment||✓||✓||✓||✓||✓||✓||50%||75%||✓||✓|
|Co-insurance for skilled nursing facility||✓||✓||✓||✓||50%||75%||✓||✓|
|Medicare Part A deductible||✓||✓||✓||✓||✓||50%||75%||50%||✓|
|Medicare Part B deductible||✓||✓|
|Medicare Part B excess charges||✓||✓|
|Foreign travel emergency||80%||80%||80%||80%||80%||80%|
|1. Plans C and F are not available to new beneficiaries who become eligible for Medicare on or after January 1, 2020.
2. Plans F and G also offer a high deductible plan which has an annual deductible of $2,340 in 2020. Once the annual deductible is met, the plan pays 100% of covered services for the rest of the year. The high deductible Plan F is not available to new beneficiaries who become eligible for Medicare on or after January 1, 2020.
3. Plan K has an out-of-pocket yearly limit of $5,880 in 2020. Plan L has an out-of-pocket yearly limit of $2,940 in 2020.
4. Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to $50 for emergency room visits that don’t result in an inpatient admission.
View an image version of this table.
Medicare Advantage plans (Medicare Part C) do not cover Part B excess charges.
A Medicare Advantage plan, however, does include an annual out-of-pocket spending limit for covered Part A and Part B services. This could help protect you from paying Part B excess charges past a certain amount, if you face them and if they go beyond your plan’s annual out-of-pocket spending limit.
Medicare Advantage plans provide all of the same benefits provided by Original Medicare, and many Medicare Advantage plans include some additional benefits that Original Medicare doesn’t cover.
These additional benefits may include things like:
Call to speak with a licensed insurance agent who can help you learn more about Medicare Advantage plan coverage and compare plans that are available where you live.
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