What Medicare Part B Excess Charges Are

An excess charge is an amount a doctor or other healthcare provider bills you above what Medicare Part B allows. Medicare sets a maximum fee for each service — a colonoscopy, an office visit, a blood test. Some doctors accept this Medicare fee as full payment. Others are permitted to charge you more, and that extra amount is the excess charge.

Not all doctors charge excess amounts. Whether a doctor can charge you an excess depends on whether they are participating or non-participating in Medicare. A participating provider has agreed to accept Medicare's allowed amount as the full fee. A non-participating provider has not made that agreement and can legally charge you more — up to a limit set by federal law.

The excess charge comes out of your pocket. Medicare will not pay it, and it does not count toward your Part B deductible or out-of-pocket maximum. This means you could owe money even after Medicare has paid its share.

Key Takeaways

  • Excess charges are amounts doctors bill above Medicare's allowed fee, and Medicare will not pay them.
  • Only non-participating doctors can charge excess amounts; participating doctors must accept Medicare's fee as full payment.
  • Federal law limits excess charges to 15 percent above Medicare's allowed amount for most services.
  • You can find out whether a doctor participates in Medicare before your visit by calling their office or checking the Medicare provider search tool.
  • Excess charges do not count toward your Part B deductible or out-of-pocket maximum.

The Difference Between Participating and Non-Participating Doctors

A participating provider signs an agreement with Medicare each year to accept the Medicare-allowed amount as payment in full for covered services. After Medicare pays its share, you pay only your coinsurance (usually 20 percent of the allowed amount) and any deductible you still owe. You will never see an excess charge from a participating doctor.

A non-participating provider does not have this agreement. They can charge you the Medicare-allowed amount plus an excess charge. However, federal law caps this excess at 15 percent above the allowed amount. So if Medicare's allowed amount for a service is $100, a non-participating doctor can charge you no more than $115 total (the $100 allowed amount plus $15 excess).

Even with the 15 percent cap, the excess charge is your responsibility. If the non-participating doctor charges $115 and Medicare pays 80 percent of the $100 allowed amount ($80), you owe $35 — the $20 coinsurance on the allowed amount plus the full $15 excess charge.

How Much Excess Charges Can Be

The federal limit on excess charges is 15 percent of Medicare's allowed amount. This limit applies to most doctors and services covered by Part B. However, the actual excess charge you see depends on what the individual doctor chooses to charge.

Some non-participating doctors charge the full 15 percent allowed excess. Others charge less or none at all. There is no requirement that they charge the maximum. You will not know the exact excess charge until you receive a bill or call the doctor's office to ask.

The excess charge applies to each service separately. A doctor might charge an excess for an office visit but not for a lab test, or vice versa. Always ask about excess charges before scheduling a service with a non-participating provider, especially if the service is expensive or you are having multiple procedures.

How to learn about Your Doctor Participates in Medicare

The easiest way to check is to call your doctor's office directly and ask: "Do you participate in Medicare?" or "Are you a participating Medicare provider?" The staff can tell you when ready.

You can also search the Medicare provider directory online at Medicare.gov. Go to the "Care Provider Search" tool, enter your doctor's name and location, and the results will show whether they are participating or non-participating. The search tool also lists the doctor's specialty and whether they are currently accepting new Medicare patients.

If you are looking for a new doctor, checking participation status before you schedule is the best way to avoid surprise excess charges. If you already see a non-participating doctor, knowing their status helps you budget for the extra cost.

What Happens When You Receive a Bill With an Excess Charge

When a non-participating doctor bills you, you will receive an Explanation of Benefits (EOB) from Medicare showing what Medicare allowed and what Medicare paid. The doctor's bill will show the total charge, which includes the excess. The difference between what Medicare paid and what the doctor charged is your responsibility.

Check the EOB carefully. Verify that the excess charge does not exceed 15 percent of the allowed amount. If it does, you can contact the doctor's office and ask them to adjust the bill. If they refuse, you can file a complaint with your state's medical board or with Medicare.

Keep in mind that excess charges do not count toward your Part B out-of-pocket maximum. Even if you have already met your deductible and coinsurance limits for the year, you still owe the full excess charge amount.

Ways to Reduce or Avoid Excess Charges

The most direct way to avoid excess charges is to use participating doctors whenever possible. Since participating doctors accept Medicare's allowed amount as full payment, you will never face an excess charge from them.

If you need a service from a non-participating doctor, ask about the excess charge before the appointment. Some doctors will waive or reduce the excess if you ask, though they are not required to. Getting the amount in writing before the service protects you from surprises.

If you have a choice between a participating and non-participating provider for the same service, the participating provider will cost you less out of pocket. Your primary care doctor or local hospital can often refer you to participating specialists in your area.

Frequently Asked Questions

Can a doctor charge me an excess if I have a Medigap or Medicare Advantage plan?

This depends on your plan type. If you have a Medigap plan, some plans cover excess charges and some do not — check your plan documents. Medicare Advantage plans have different rules and often do not cover excess charges. Contact your plan directly to ask whether excess charges are covered under your specific policy.

What if a non-participating doctor charges more than 15 percent above the allowed amount?

That is illegal. If you believe a doctor has overcharged you, contact Medicare at 1-800-MEDICARE or file a complaint with your state's medical board. Keep copies of your bill and the EOB as proof of the overcharge.

Does an excess charge count toward my Part B deductible or out-of-pocket maximum?

No. Excess charges are separate from your deductible and out-of-pocket limits. You owe the full excess charge amount in addition to any coinsurance or deductible you may owe on the allowed amount.

If I switch to a participating doctor, will my old bills with excess charges be adjusted?

No. Excess charges from past visits are your responsibility. However, switching to a participating doctor going forward will prevent excess charges on future services. If you believe an excess charge was incorrect, contact the doctor's office or file a complaint with Medicare.

Are there any doctors who cannot charge excess amounts?

Yes. Doctors who are participating providers, doctors who work for hospitals or clinics that participate in Medicare, and certain specialists in some situations cannot charge excess amounts. Non-participating doctors are the only ones permitted to charge excess fees, up to the 15 percent limit.