How Healthcare Providers Bill Medicare for Your Care

Medicare billing happens between your provider and Medicare, not between you and Medicare

When you receive care from a doctor, hospital, or other provider who accepts Medicare, that provider sends the bill directly to Medicare. You do not send anything to Medicare yourself. The provider submits a claim with details about the service you received — what was done, when, and why — and Medicare pays them based on its fee schedule. Your role is to show your Medicare card when you arrive for care and to pay any cost-sharing (copayments, coinsurance, or deductibles) that explore to your plan.

The billing process looks different depending on whether you have Original Medicare (Parts A and B) or a Medicare Advantage plan, and it matters whether your provider is in-network or out-of-network. Understanding how this works helps you know what to expect on a bill and what you actually owe.

Key Takeaways

Providers bill Medicare directly using a claim form that includes your Medicare number, the service code, and the date of service.
Original Medicare pays the provider 80% of the approved amount after you meet your deductible; you pay the remaining 20% coinsurance.
Medicare Advantage plans have their own billing rules, copays, and in-network requirements that vary by plan.
Out-of-network providers in Original Medicare can bill you for the difference between what Medicare pays and what they charge, unless they are participating providers.
You should receive an Explanation of Benefits (EOB) that shows what Medicare paid and what you owe.

How Original Medicare billing works

With Original Medicare (Part A for hospital care and Part B for doctor visits and outpatient services), your provider submits a claim to Medicare using your Medicare number and a service code that describes what was done. Medicare has a fee schedule — a set price for each service — and it pays 80% of that approved amount once you have met your annual deductible. You pay the remaining 20%, called coinsurance.

For example, if you see a participating doctor for an office visit and the Medicare-approved amount is $100, you pay your deductible first (if you have not met it yet). After the deductible is met, Medicare pays $80 and you pay $20. The provider cannot bill you for more than that $20 — they have agreed to accept Medicare's approved amount as payment in full.

Part A (hospital insurance) works differently. You pay a deductible per hospital stay, and Medicare covers the rest for the first 60 days. After that, your costs rise. The provider bills Medicare directly; you do not submit anything.

How Medicare Advantage plan billing works

Medicare Advantage plans (Part C) are run by private insurance companies, not by Medicare itself. When you use an in-network provider, that provider bills the Medicare Advantage plan, not Original Medicare. The plan then pays the provider based on its own fee schedule and rules, which differ from Original Medicare's. You typically pay a copay at the time of service — a flat amount like $20 for a doctor visit — rather than coinsurance.

The key difference is that Medicare Advantage plans control their own networks and billing. If you see an out-of-network provider, you may pay more or the plan may not cover the service at all, depending on your plan's rules. Always check your plan's provider directory before scheduling care to avoid surprise bills.

What happens if your provider is out-of-network

In Original Medicare, all providers who accept Medicare are considered "participating" or "non-participating." A participating provider has agreed to accept Medicare's approved amount as full payment. A non-participating provider can charge up to 15% more than the approved amount — this extra charge is called balance billing. You would owe the 20% coinsurance plus the balance bill.

For example, if the Medicare-approved amount is $100 and a non-participating provider charges $120, Medicare pays $80 (80% of $100). You owe $20 (your 20% coinsurance) plus $20 (the balance bill), for a total of $40 out of pocket. Some providers do not accept Medicare at all; if you see them, you may have to pay the full bill yourself and then request reimbursement from Medicare.

Medicare Advantage plans do not use the same participating/non-participating system. Instead, they have contracted networks. Using an out-of-network provider in a Medicare Advantage plan usually means higher out-of-pocket costs or no coverage at all.

Understanding your Explanation of Benefits

After your provider submits a claim, Medicare sends you an Explanation of Benefits (EOB) — a document that shows what was billed, what Medicare approved, what Medicare paid, and what you owe. The EOB is not a bill; it is a record of the transaction. Your actual bill comes from the provider.

On the EOB, you will see the service code, the amount the provider charged, the Medicare-approved amount, the deductible applied, Medicare's payment, and your coinsurance. If the provider charged more than the approved amount and is non-participating, the EOB will show the balance bill amount. Review your EOB against your provider's bill to make sure they match.

If you have a Medicare Advantage plan, your plan sends you an EOB instead of Medicare. The format and detail may differ, but the purpose is the same: to show you what was billed and what you owe.

What you need to do when you receive care

When you go to a doctor's office, hospital, or other provider, bring your Medicare card. The staff will ask for it and may ask for any other insurance you have. Tell them about any supplemental insurance (Medigap) or Medicare Advantage plan you have, because billing rules change depending on what coverage you carry.

At the time of service, you may be asked to pay a copay or coinsurance upfront. Participating providers in Original Medicare should not ask you to pay more than your estimated coinsurance at that time. If a provider asks you to sign a form saying you understand you will owe a large amount, read it carefully — some forms are legitimate advance notices, but others may not be.

After your visit, keep any paperwork the provider gives you. When you receive your EOB from Medicare or your plan, compare it to the provider's bill. If the amounts do not match or if you see charges you do not understand, contact the provider's billing department or call Medicare at 1-800-MEDICARE.

How supplemental insurance (Medigap) affects billing

If you have a Medigap policy, it covers some or all of your coinsurance and deductibles in Original Medicare. When you see a participating provider, the provider bills Medicare first. Medicare pays its 80%, and then your Medigap policy pays some or all of the remaining 20% you would owe. You may owe nothing at the point of service, depending on your Medigap plan.

The provider submits the claim to Medicare, and Medicare forwards information to your Medigap insurer. The Medigap company then pays the provider directly or reimburses you. The process is automatic once your Medigap policy is linked to your Medicare number. You do not have to submit anything yourself.

Frequently Asked Questions

Can a provider bill me for more than Medicare approves?

In Original Medicare, a participating provider cannot bill you more than your coinsurance (usually 20%) plus your deductible. A non-participating provider can charge up to 15% more than the approved amount and bill you for that difference. Medicare Advantage plans have their own rules; check your plan documents.

What should I do if I receive a bill I think is wrong?

Compare the bill to your EOB. If the amounts do not match, call the provider's billing department first. If you believe Medicare made an error, call 1-800-MEDICARE. You can also file an appeal with Medicare if you disagree with what was approved or paid.

Do I have to pay a bill before Medicare processes the claim?

No. Providers should not ask you to pay the full bill before submitting it to Medicare. You may be asked to pay your estimated coinsurance or copay at the time of service, but the provider should wait for Medicare to process the claim before billing you for the rest.

What if my provider does not accept Medicare?

If a provider does not accept Medicare, you will have to pay them out of pocket. You can then submit the bill to Medicare yourself and request reimbursement, though Medicare will only pay its approved amount, not what the provider charged. Always ask whether a provider accepts Medicare before scheduling care.

How long does it take for Medicare to process a claim?

Medicare typically processes claims within 30 days. You should receive your EOB within that timeframe. Providers may take longer to send you a bill after Medicare pays. If you do not receive an EOB within 60 days, contact Medicare.

This guide is for general information only and is not medical, financial, legal, or other professional advice. For decisions specific to your situation, consult a qualified professional. See our Editorial Policy.