What are Part B Excess Charges?
Medicare Part B Excess Charges are important to understand when you are deciding what Medigap Plan (Medicare Supplement) to get.
Every once-in-a-while, we hear from a client that is confused about a doctor’s bill. They are confused that there is a fee they need to pay that Medicare didn’t cover that they thought was covered by Medicare. Moreover, they have a supplement, that they believe should have also picked up the rest of the cost.
Often times, this fee turns out to be an “excess charge.” Let’s see what this means.
Excess Charges in Medicare Defined
Excess Charges are amounts of money charged by doctors or other healthcare providers above what Medicare has stated it will pay for a specific service. In other words, the amount of money charged above the Medicare approved amount is the excess charge.
Basically, your doctor or healthcare provider is more expensive for a particular service than the Medicare approved reimbursement. If this is the case, you either have to pay the excess fee out-of-pocket, or you might have the fee picked up by your Medigap (aka Supplement) plan.
Medicare Supplements and Excess Charges
Beneficiaries of the Medicare Healthcare System use Medicare Supplements to pick up the costs that Original Medicare does not pay. (Medicare picks up 80% and beneficiaries pick up 20%, unless they have a supplement or a Medicare Advantage Plan.) These costs include co-payments, co-insurance and deductibles. Medicare
Supplements pay some or all of these extra costs, depending on what plan you get.
What Medigap Plans Cover Excess Charges?
Plan F and Plan G Cover Excess Charges.
- If you have aged into Medicare before 2020, you can pick either Plan F or Plan G. The only difference between Plan F vs Plan G, is G does not cover the Medicare Part B Deductible.
- If you age into Medicare after 2020 (i.e. your 65th birthday is on or after January 1, 2020) then you cannot get Plan F. Plan G would then be your only option for a plan that covers Part B excess charges.
- To read more about why this birthday cut off exists, please read this article.
All other plans do not cover excess charges. If you have any of the other Medicare Supplement (Medigap) Plans, you will be responsible for paying excess charges.
Is My Service or Procedure Covered by Medicare?
If you are trying to figure out if your needed service or procedure is part of Medicare’s covered services, and/or how much is covered, then start with the Medicare.gov web-page here.
Medicare Advantage & Excess Charges
If you have a “Part C” Medicare Advantage (MA / MAPD) Plan, then excess charges do not apply to you. Medicare Advantage Plans basically replace Original Medicare and cover all of the services they are required to, plus many have additional coverage and benefits.
Your specific Medicare Advantage plan costs will be outlined by your private insurance company. So, you will know exactly what is covered and what costs you are responsible for according to your plan. In addition, your plan may have a network of doctors that have negotiated rates with your plan, so excess charges may not even be relevant to your MA set-up.