MEDICARE PART B EXCESS CHARGES EXPLAINED

Michael Braden
Aug 29, 2025
5 min read

Updated: Jan 6

Michael T. Braden August 29, 2025 Medicare Part B

MEDICARE PART B EXCESS CHARGES EXPLAINED

A significant trend we have observed over the past three years is the growing interest in Medigap Plan N as an alternative to Medigap Plan G, whose premiums have increased consistently during the same period. Part of these increases is due to the simple fact that Healthcare costs continue to rise; they never go down. This has been exacerbated by many insurance companies capitalizing on their own greed, as well as the fact that, over the last three years, everything has been blamed on inflation.

WHAT ARE MEDICARE PART B EXCESS CHARGES

Doctors and other healthcare providers may choose whether to participate in the Medicare program. Providers who participate with Medicare agree to charge you only the Medicare-approved amount for their services. In essence, they agree to accept the Medicare amount as payment in full for covered services.

This is also referred to as “accepting Medicare assignment.”

Medicare Part B Excess Charges are an additional amount you could be charged if a doctor does not accept Medicare Assignment.
Medicare assignment occurs when a doctor does not accept the amount that Medicare will pay for a service.
If you are responsible for Part B excess charges, a doctor can charge you 15% above what Medicare pays them.

If you’ve been shopping for Medigap plans, you may have discovered that a couple of them (Plan G and Plan F) cover something called “Part B Excess Charges.” If you’re not sure what excess charges are, you’re not alone. Fortunately, they’re a relatively rare occurrence for most Medicare beneficiaries.

Nonetheless, it’s essential to understand how Part B excess charges work and how they might affect your out-of-pocket healthcare expenses. Here’s what you need to know.

WHAT IS MEDICARE ASSIGNMENT

When a provider accepts Medicare assignment rates, it means that the provider won’t bill you above the Medicare-allowable rate by a participating provider.

Providers who don’t participate in Medicare can bill you up to 15% more than the Medicare allowable amount at their discretion. This additional amount is considered a Part B excess charge. You will have to pay it out-of-pocket unless you have a Medigap plan that includes benefits for Part B excess charges.

Braden Medicare Insurance Poster About Avoiding Excess Charges

There are other advantages to choosing a participating provider, aside from avoiding Part B excess charges, if you have Medicare:

They agree to collect only your Part B deductible and/or coinsurance amount at the time of service. Most wait until Medicare has paid its share to bill you. Nonparticipating providers may collect payment in full up front.
They must submit your claim to Medicare on your behalf and at no cost to you. Nonparticipating providers, on the other hand, may not bill Medicare, so you have to file a claim yourself to get reimbursed.

HOW CAN MEDICARE PART B EXCESS CHARGES AFFECT YOU

Suppose you see a nonparticipating dermatologist for the removal of a few suspicious moles. If the Medicare allowable charge for this procedure is $400, the dermatologist could bill you $460. Assuming you’ve met your Part B deductible already, your out-of-pocket costs for the procedure would be $140. This is your 20% coinsurance amount of $80 plus the 15% Part B excess charges of $60. With a participating provider, your out-of-pocket expenses would be just $80.

Note that excess charges do not go towards your Part B deductible.

Statistics suggest that as many as 95% of primary care providers accept assignment. A slightly smaller number of specialist physicians also take it. Not all nonparticipating providers will add Part B excess charges if you don’t have a Medigap plan, so you may only rarely see Part B excess charges.

That said, however, there is no limit on the number of times a nonparticipating doctor can add excess charges to your bill. So, if you regularly see a provider who doesn’t accept assignment, you could easily pay hundreds of dollars in excess charges each year.

Also, if you see a doctor who accepts Medicare assignment, but Medicare doesn’t take the claim for the service billed, the doctor can charge you more than Medicare’s approved price. However, if an Advance Beneficiary Notice (ABN) isn’t signed, you may not be responsible for these charges. Note that ABNs are not required for services never covered by Medicare.

WHAT IS THE BEST WAY TO AVOID GETTING HIT WITH MEDICARE PART B EXCESS CHARGES?

The easiest way to avoid excess charges is to use physicians who accept Medicare assignment. You will never be billed more than Medicare allows for your healthcare services. It’s always a good idea to ask your doctor if they accept assignment before you make an appointment. Don’t forget to ask the same question of any Medicare provider, such as lab facilities and home health care companies.

You can also find providers in your area that participate with Medicare using the Medicare.gov physician locator tool.

Of course, you can also avoid paying excess charges out-of-pocket by buying a Medigap plan that pays them for you. Currently, both Plan F and Plan G include this benefit.

SOME STATES HAVE MADE IT ILLEGAL TO CHARGE MEDICARE BENEFICIARIES FOR PART B EXCESS CHARGES

Some states have taken matters into their own hands when it comes to protecting seniors against excess charges.

The following states passed laws prohibiting healthcare providers from charging Medicare beneficiaries anything higher than the Medicare allowable rate:

Connecticut (for QMB beneficiaries only)
Minnesota
Ohio
Pennsylvania
Rhode Island
Vermont
Massachusetts
New York

People in these states might also consider Medigap Plan N, which has similar benefits to Plan G. One big difference is that Plan N does not cover excess charges, so the premiums for Plan N are lower.

If you live in a state that doesn’t allow excess charges, Plan N might appeal to you. Remember that when you are out of state, you must ask the assignment question of providers. This means that if you have Plan N and live in a state that does not allow excess charges, but you see a provider in another state that does, you would be responsible for paying the provider.

WRAPPING THINGS UP

Most Doctors (About 93.8%) accept Medicare Assignment. The biggest group of providers who do not accept Medicare's Fee Schedule or Medicare's Assignments are Psychologists, Psychiatrists, Pediatricians, Homeopathic doctors, and Naturopathic doctors.
If a doctor does not accept Medicare Assignment, they can charge you 15% above what Medicare pays them.
Part B excess charges are not standard but may apply in emergencies.
Medigap Plan F and Plan G cover excess charges for you.
Every Medicare Beneficiary should develop the habit of verifying that any new doctor, provider, or healthcare professional they are seeing or with whom they are making an appointment accepts Medicare. All it takes is a quick phone call to the provider's office; ask whether they accept Medicare, and if they say yes, you know you are covered and will have no surprise "Excess Charges" to worry about.