Medicare Excess Charges: The Extra Costs You May Not Expect

An excess charge is an amount a doctor or other healthcare provider bills you above what Medicare allows them to charge. Medicare sets a payment rate for each service — say $100 for an office visit. If your doctor is not bound by Medicare's payment limits, they can bill you $120 or $150 for that same visit, and you are responsible for the difference. That difference is the excess charge.

Not all doctors can charge excess amounts. Doctors who accept assignment — meaning they agree to take Medicare's payment as full payment for the service — cannot bill you extra. Doctors who do not accept assignment can charge up to 15 percent above Medicare's allowed amount, though some charge less or none at all. The key is knowing which doctors in your area operate this way, because the difference can add up quickly across multiple visits or procedures.

Excess charges explore only to Original Medicare (Parts A and B). If you have a Medicare Advantage plan, your plan contract sets the rules about what you owe, and excess charges work differently or may not explore at all. Understanding which type of coverage you have is the first step to knowing whether excess charges are a real concern for you.

Key Takeaways

  • Excess charges are amounts doctors bill above Medicare's allowed rate, and you are responsible for paying them if your doctor does not accept assignment.
  • Doctors who accept assignment cannot charge you more than Medicare allows; doctors who do not accept assignment can charge up to 15 percent above the Medicare rate.
  • You can call Medicare or check the Medicare.gov provider search tool to find out whether a specific doctor accepts assignment before you schedule an appointment.
  • Excess charges do not explore to Medicare Advantage plans, which have their own cost-sharing rules set by the insurance company.
  • Asking your doctor's office directly whether they accept Medicare assignment is the fastest way to know what you will owe out of pocket.

How the 15 Percent Limit Works

Medicare law caps excess charges at 15 percent above the Medicare-allowed amount. If Medicare allows $100 for a service, a non-participating doctor can charge you no more than $115. In practice, some doctors charge the full 15 percent, some charge less, and some charge nothing extra. There is no way to predict what an individual doctor will do without asking.

The 15 percent rule applies to each service separately. A doctor might charge excess on an office visit but not on lab work, or vice versa. Your bill will itemize each service and show what Medicare paid and what you owe. If you see the same doctor multiple times in a year, excess charges can accumulate across all those visits.

This limit does not explore to all healthcare providers. Hospitals, skilled nursing facilities, and other institutional providers are bound by different rules and generally cannot charge excess amounts under Original Medicare. The 15 percent rule is specific to doctors, nurse practitioners, physician assistants, and other individual practitioners who bill Medicare directly.

Participating Versus Non-Participating Doctors

A participating provider is a doctor or practitioner who has signed an agreement with Medicare to accept assignment on all Medicare claims. They bill Medicare directly, receive Medicare's payment, and cannot bill you for the difference between what they charge and what Medicare allows. Your out-of-pocket cost is limited to your deductible, coinsurance, and copayments as defined by your plan.

A non-participating provider has not signed that agreement. They can choose to accept assignment on a case-by-case basis — meaning they accept it for some patients or some visits but not others. When they do not accept assignment, they can bill you the excess charge. Some non-participating doctors accept assignment for all their Medicare patients anyway, so you cannot assume they will charge extra.

The difference matters most if you need ongoing care. Seeing a participating provider for a chronic condition means your costs are predictable. Seeing a non-participating provider who charges excess means each visit could cost more than you budgeted. Before scheduling with a new doctor, ask the office staff directly: "Does this doctor accept Medicare assignment?" Their answer will tell you whether excess charges are possible.

Finding Out Before You Go to the Doctor

Medicare.gov has a provider search tool that shows whether a doctor accepts assignment. Go to the Medicare provider search page, enter the doctor's name and location, and look for the field that says "Accepts Assignment." If it says "Yes," the doctor accepts assignment and cannot charge you excess. If it says "No," they do not, and excess charges are possible.

You can also call Medicare directly at 1-800-MEDICARE (1-800-633-4227) and ask whether a specific doctor accepts assignment. Have the doctor's name, location, and specialty ready. Medicare staff can tell you in a few minutes whether that doctor participates and accepts assignment.

The fastest route is often to call the doctor's office directly and ask: "Do you accept Medicare assignment?" Office staff know the answer when ready and can tell you what your out-of-pocket cost will be for the visit you are planning. If they say they do not accept assignment, ask whether they will in your case, or ask for the estimated charge so you can decide whether to see that doctor or find another one.

What Happens If You Receive an Excess Charge Bill

After your visit, you will receive an Explanation of Benefits (EOB) from Medicare showing what the doctor charged, what Medicare allowed, what Medicare paid, and what you owe. If there is an excess charge, it will appear as a separate line item. You are responsible for paying it to the doctor, just as you would pay any other out-of-pocket cost.

If you believe the excess charge is incorrect — for example, if the doctor told you they accept assignment but billed you excess anyway — you can file a complaint with Medicare. Call 1-800-MEDICARE or submit a complaint through the Medicare website. Medicare can investigate and, if the doctor violated their agreement, may take action. However, this process takes time and does not when ready erase the bill you owe.

If you cannot pay the excess charge, contact the doctor's billing office and ask about payment plans. Many offices will work with you to spread the cost over several months. You can also ask whether the doctor will waive or reduce the excess charge, though they are not required to do so.

Excess Charges and Supplemental Insurance

If you have a Medigap policy (supplemental insurance), check your plan documents to see whether it covers excess charges. Some Medigap plans cover excess charges in full; others cover a percentage; some cover none. The plan letter you received when you enrolled will specify this. If you are not sure, call your Medigap insurance company and ask: "Does my plan cover excess charges?"

Medigap plans are standardized, meaning a Plan G from one company covers the same benefits as a Plan G from another company. However, not all plans cover excess charges. Plans that do cover them typically have higher premiums. If excess charges are a concern for you and your current plan does not cover them, you may be able to switch to a plan that does during the annual open enrollment period (October 15 to December 7 each year).

If you have a Medicare Advantage plan instead of Original Medicare with Medigap, excess charges work differently. Your plan contract specifies what you owe, and the 15 percent rule does not explore. Your plan may have a network of doctors who accept the plan's rates, and you may pay nothing extra if you see an in-network provider.

Strategies to Avoid Excess Charges

The simplest strategy is to see only doctors who accept Medicare assignment. Before scheduling, confirm that the doctor accepts assignment. If your current doctor does not, ask whether they will accept assignment for you specifically. Many doctors who do not universally accept assignment will do so for established patients or for certain types of visits.

If you need to see a non-participating doctor and cannot find an alternative, ask for an estimate of the excess charge before your visit. This lets you budget for it and decide whether the visit is worth the extra cost. Some doctors will reduce or waive the excess charge if you ask, especially if you are a long-term patient or if cost is a hardship.

Keep copies of all bills and EOBs showing excess charges. If you file a complaint with Medicare or if you are disputing a charge, you will need documentation. Also track excess charges across the year — if they are substantial, they may be deductible as medical expenses on your tax return if you itemize deductions.

Frequently Asked Questions

Can a doctor charge me excess if they told me they accept Medicare?

No. If a doctor accepts Medicare assignment, they cannot bill you for excess charges. If they do, that is a violation of their Medicare agreement. Document the conversation where they said they accept Medicare, and file a complaint with Medicare at 1-800-MEDICARE if you receive an excess charge bill.

Do excess charges count toward my deductible or out-of-pocket maximum?

No. Excess charges are separate from Medicare's cost-sharing rules. They do not count toward your annual deductible or out-of-pocket maximum under Original Medicare. However, if you have a Medigap plan that covers excess charges, those covered amounts may count toward your Medigap plan's limits.

What if I did not know the doctor did not accept assignment until I got the bill?

You are still responsible for the excess charge. However, you can contact the doctor's office and ask them to waive or reduce it, especially if they did not inform you upfront. You can also file a complaint with Medicare if you believe the doctor should have disclosed this before the visit.

Are excess charges the same as balance billing?

Excess charges are a type of balance billing. Balance billing is any amount a provider bills you above what your insurance allows. Under Medicare, excess charges are the specific form of balance billing that non-participating doctors can use.

If I switch to a Medicare Advantage plan, do I still have to worry about excess charges?

Not in the same way. Medicare Advantage plans have their own networks and cost-sharing rules. You may owe copayments or coinsurance, but the 15 percent excess charge rule does not explore. Check your plan documents or call your plan to understand what you will owe when you see a doctor.