When you receive care under Original Medicare, Medicare sets an approved amount for each covered service. Most doctors who accept Medicare agree to accept this amount as payment in full - a practice called "taking assignment." However, some doctors do not accept Medicare assignment and can legally charge up to 15% more than the Medicare-approved amount. This extra charge is called a Part B excess charge.
How Part B Excess Charges Work
Here is a simple example: if Medicare approves $200 for a procedure, a non-participating provider can charge up to $230 (15% above the approved amount). Medicare will still pay its standard share - typically 80% of the approved amount, or $160 - but you would be responsible for the remaining $70 rather than the usual $40 coinsurance. That $30 difference is the excess charge.
Excess Charges Are Banned in Some States
Several states - including Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont - prohibit providers from billing Medicare patients excess charges. If you live in one of these states, you are protected regardless of whether your doctor takes assignment.
Participating vs. Non-Participating Providers
| Provider Type | Accepts Assignment? | Can Charge Excess? | Your Risk |
|---|---|---|---|
Participating provider | Yes - always | No | None |
Non-participating provider | Case by case | Up to 15% above approved amount | Moderate |
Opt-out provider | No - never | Any amount | High - Medicare pays nothing |
Opt-out providers have completely withdrawn from Medicare and can charge any amount they choose. Medicare will not pay anything for services from an opt-out provider unless it is a genuine emergency. Always verify a provider's Medicare participation status before scheduling non-emergency care.
How to Protect Yourself from Excess Charges
Ask before your appointment whether the provider accepts Medicare assignment.
Use Medicare's provider search at Medicare.gov to find participating providers in your area.
Enroll in a Medigap Plan G or Plan N - Plan G covers 100% of Part B excess charges, eliminating this risk entirely.
Check your Medicare Summary Notice (MSN) after each visit to verify charges are correct.
Avoid opt-out providers for non-emergency services unless you are prepared to pay the full cost out of pocket.
Medigap Plans That Cover Excess Charges
The most effective way to eliminate the risk of Part B excess charges is to enroll in a Medigap plan that covers them. Medigap Plan G and Plan F both cover 100% of Part B excess charges. Plan F is only available to beneficiaries who became eligible for Medicare before January 1, 2020. For most new enrollees, Plan G is the gold standard for comprehensive coverage.
Medigap Plan N does not cover excess charges, so you could still face them if you see a non-participating provider. If you choose Plan N, make sure to always verify that your providers accept Medicare assignment.
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