Part B excess charges come into play when your doctor, hospital, physical therapist, counselor or any other provider doesn’t accept the assignment. Original Medicare is widely accepted nationwide, but not every provider accepts the assignment. They might accept Medicare, but they don’t have a written agreement with Medicare to honor the set pricing structure. Medicare allows these providers to charge a certain percentage above the Medicare-approved amount. But there is a limit. It’s called the “limiting charge,” and it allows non-participating providers (those who accept Medicare but don’t accept assignment) to charge up to 15 percent on top of the Medicare-approved amount for covered services.
Example Scenario For Part B Excess Charges
You visit your doctor for flu symptoms. Your doctor, who does not accept Medicare assignment but does accept Medicare, charges $220 for an office visit.
Medicare Part B covers 80 percent of the Medicare-approved amount for medical care. In this example, they’ve decided that $200 is an acceptable amount for an office visit. Medicare will pay for 80% of $200, or $160.
You will owe your standard Part B coinsurance (20%) plus the difference between what Medicare covers and what your provider charges. This difference is known as a Part B excess charge.
Total out-of-pocket cost to you: $40 (20% of $200) + $20 (excess charge) = $60
