Medicare Part B Excess Charges is a term that is used with Medicare Supplement, or Medigap, plans. These charges, most simply defined, are charges that a doctor charges above and beyond the Medicare-approved amount for a service or procedure. Many physicians DO accept the Medicare-approved amount; however, there are some that do NOT. In these cases, you can be responsible for this amount above and beyond the Medicare-approved amount, unless you have a Medicare supplement plan that covers Medicare Part B Excess charges, such as Medigap Plan F or Medicare Supplement Plan G. These plans cover 100% of the Part B Excess charges.
Medigap Quotes on Plans That Cover Part B Excess Charges
Part B Excess Charges – An Example to Assist in Understanding
Medicare Part B Excess charges, again, do not happen all the time, but it can occur if a physician doesn’t accept the Medicare-approved amount. So, it is important to understand how they work if you are on Medicare. Here is an example:
- Mary goes to the doctor for a regular check-up. The Medicare-approved amount for this particular visit in her area is $100.
- However, the physician does not accept Medicare “assignment” (the approved amount) and charges an additional 15% (this percentage above the Medicare-approved amount is typically limited to a certain percentage). So, the visit will cost $115.
- Medicare will pay their 80% (of the Medicare-approved amount), assuming the Part B deductible has already been met. So, they will pay $80.
- That leaves Mary with a cost of the remaining $20, plus the $15 in “excess” charges, for a total of $35.
- If she has a Medicare Supplement plan F or Plan G, the plan will pick up both the remaining 20% and the $15 in “excess charges”.
Should I Buy a Medigap Plan That Does Not Cover Part B Excess Charges?
There are several Medigap plans that do not cover Medicare Part B Excess charges, most notably Plan N. Plan N is increasingly becoming a popular option for people purchasing Medicare supplement insurance, as it is a lower premium alternative to Plans F and G.
In most cases, the Plan N premiums are $40-50 lower per month than Plan F premiums. If that is the case, and if you are in good health, it may make sense to get a Plan N.
Here are the calculations we use and recommend our clients to use when comparing Plan F vs. Plan N:
- First, figure out the difference in annual premium between Plan F and Plan N for your age/zip code. (For this example, let’s say it is $500/year).
- Next, take out the Medicare Part B deductible for the year. (For 2015, it is $147/year. So, that brings us down to $353 in savings on ‘N’).
- Next, let’s look at your average number of doctor visits. Keep in mind that there is no maximum amount of $20 co-pays that you would pay, so if you end up having to do a rehab or something that requires many doctor visits, that could add up quickly. But, for our example, let’s say 5 doctor visits a year for a total of $100 in co-pays.
- That leaves $250 per year in possible “Part B Excess Charges” that you could have and still come out better on ‘N’ than ‘F’. Based on the current infrequency of those, that’s probably not likely in the case of someone who is going to the doctor 5 times a year.
How Can I Find Out If My Doctor Charges “Excess Charges”?
It’s simple – just ask the person in his or her office that handles billing/insurance. If they see Medicare patients, they will know if they accept the Medicare-approved amount. That way, there will be no surprises. This can also help you decide between Medigap plans, if you are comparing a plan that covers “excess charges” vs. one that does NOT cover them.
Generally, specialists and physicians in large urban areas are more likely to NOT participate in Medicare, or accept “assignment”.
What’s the Future of Medicare Part B Excess Charges?
Medicare Part B Excess Charges may become more common in coming years. As physicians fee cuts become a more real possibility, it is possible that more doctors will become non-participating providers with Medicare. Some say that this is already happening as of late 2015, and maybe it is; however, each situation is individual and you should consult all of your doctors to find out where they stand on the issue and how they handle Medicare patients.
To get quotes on Medicare supplement plans or more information about Medigap or Part B Excess charges, go to Medicare Supplement quote or you can reach us by phone toll-free at 877.506.3378.
We look forward to helping you compare plans and serving your Medicare Supplement insurance comparison needs.