Medicare Part B Excess Charges: What They Are and How to Avoid Them

When you rely on Traditional Medicare, you expect your medical bills to be predictable. But there is a specific type of out-of-pocket cost that can catch you off guard: Medicare Part B excess charges. If you are navigating the Medicare landscape, understanding how these charges work - and how to protect yourself from them - is essential to keeping your healthcare costs under control.

An excess charge occurs when a doctor or healthcare provider does not accept Medicare "assignment." Accepting assignment means the provider agrees to accept the Medicare-approved amount as full payment for covered services. If a provider does not accept assignment, they are legally allowed to charge up to 15% more than the Medicare-approved amount. This additional 15% is the excess charge, and you are responsible for paying it out of your own pocket.

For example, if the Medicare-approved amount for a procedure is $1,000, a provider who does not accept assignment can charge you $1,150. Medicare will pay 80% of the approved amount ($800), leaving you responsible for the remaining 20% ($200) plus the $150 excess charge. That means your total out-of-pocket cost would be $350 instead of $200. While 15% might not sound like a lot for a routine office visit, it can add up quickly for expensive surgeries or specialized treatments.

The good news is that you have options to protect yourself. The Medicare decision is fundamentally about choosing between two paths, not two products: Traditional Medicare (Parts A and B) or Medicare Advantage (Part C). If you choose the Traditional path, a Medicare Supplement (Medigap) plan can fill the gaps by law.

When it comes to excess charges, not all Medigap plans offer the same level of protection. Plan F and Plan G are the only two standardized Medigap plans that cover 100% of Part B excess charges. If you have one of these plans, you will never have to worry about paying that extra 15%, even if you see a doctor who does not accept Medicare assignment. Plan N, on the other hand, does not cover excess charges, which is a key difference to consider when comparing Plan G and Plan N.

It is also worth noting that some states have laws prohibiting providers from charging excess charges altogether. These are known as "MOM" (Medicare Overcharge Measure) states. If you live in one of these states, you do not need to worry about excess charges, regardless of which Medigap plan you choose. However, if you travel outside your home state for medical care, you could still be subject to excess charges in states without these protections.

You have worked hard to build your life, and you deserve straight answers, no surprises when it comes to your healthcare costs. We are on your side of the table, ready to walk you through every option. Whether you are looking for the comprehensive protection of Plan G or weighing the cost-savings of Plan N, we can help you find the right fit for your needs.

Protect what you've earned. Compare your Medigap options free, with no obligation. Our licensed agents are ready to help you navigate the Medicare maze and secure the coverage you deserve. Self-reliance isn't a slogan - it is about making informed decisions that protect your future.