Forty-two states and the District of Columbia allow Medicare Part B excess charges. In those places, a provider who accepts Medicare but does not accept assignment can legally bill you up to 15% above the Medicare-approved amount for a covered service, and you owe the difference on top of your regular deductible and coinsurance. Eight states prohibit the practice entirely: Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont.1Office of the Law Revision Counsel. 42 USC 1395w-4 – Payment for Physicians Services
The practical risk in allowing states is smaller than the rule suggests. Roughly 98% of Medicare providers accept assignment nationwide, and excess charges appear on fewer than 1% of Part B fee-for-service claims. The exposure concentrates in specialty care and high-cost metro areas.
The Eight States That Ban Excess Charges
If you live and receive care in one of these states, no provider can bill you above the Medicare-approved amount for covered Part B services, regardless of whether the provider accepts assignment:
- Connecticut
- Massachusetts
- Minnesota
- New York
- Ohio
- Pennsylvania
- Rhode Island
- Vermont
Everywhere else, the 15% limiting charge is the federal ceiling.2eCFR. 42 CFR Part 414 – Payment for Part B Medical and Other Health Services One boundary to keep in mind: excess charges only exist under Original Medicare. If you have a Medicare Advantage plan, your costs follow that plan’s network and cost-sharing rules instead.
What an Excess Charge Actually Costs You
Say Medicare approves $200 for a specialist visit. A non-participating provider in an allowing state can bill up to $230, which is 115% of the approved amount. Medicare pays 80% of its approved figure, or $160. You owe your 20% coinsurance of $40, plus the $30 excess charge. Total out of pocket: $70 instead of $40.
The excess piece is always on top of your normal cost-sharing, and you may have to pay the entire bill at the office and wait for Medicare to reimburse its share.3Medicare. Does Your Provider Accept Medicare as Full Payment?
Services That Cannot Carry Excess Charges Anywhere
Even in the 42 allowing states, federal law forces assignment for certain categories of Part B care. The limiting charge does not apply and the provider cannot bill you above the Medicare-approved amount.
- Clinical laboratory services covered under Part B.
- Durable medical equipment supplied by a Medicare contract supplier in a competitive bidding area, such as wheelchairs or CPAP machines.4Centers for Medicare & Medicaid Services. Your Guide to Medicares Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Competitive Bidding Program
- Services from physician assistants, nurse practitioners, clinical social workers, and certain other non-physician practitioners, all of whom face mandatory assignment for their Medicare-covered services.
A separate category to know about is opt-out providers. They have formally left Medicare, can charge whatever they want under a private contract, and Medicare pays nothing. Excess charge rules do not apply to them because Medicare is not in the picture at all.5eCFR. 42 CFR Part 405 Subpart D – Private Contracts
How to Keep an Excess Charge From Happening
Ask every provider, before the visit, whether they will accept Medicare assignment for your care. Non-participating providers can accept assignment on a case-by-case basis, and many will agree if you ask, especially for established patients.3Medicare. Does Your Provider Accept Medicare as Full Payment? Confirm the answer with the billing office when possible.
Medicare’s Care Compare tool at medicare.gov/care-compare shows each provider’s participation status. Participating providers always accept assignment. Non-participating providers might or might not for any given visit.
If you buy Medigap coverage, only Plan F and Plan G pay 100% of Part B excess charges.6Medicare. Compare Medigap Plan Benefits Plan F is closed to anyone who became eligible for Medicare on or after January 1, 2020, which leaves Plan G as the option for newer beneficiaries.7Medicare. When Can I Buy a Medigap Policy? Plan N, a popular lower-premium alternative, does not cover excess charges at all. If you live in one of the eight banning states, that gap in Plan N is moot. Anywhere else, it is a real trade-off against the premium savings.
What to Do If You Were Overbilled
Your Medicare Summary Notice shows the limiting charge for each service and flags any bill that exceeds it. Compare that figure against what you actually paid. Anything above the limiting charge is money the provider owes back.
Report violations to 1-800-MEDICARE (1-800-633-4227). Providers who knowingly and repeatedly exceed the limiting charge face civil money penalties of up to $10,000 per violation and assessments of up to three times the amount improperly billed, and they are required to refund the overcharge.8eCFR. 42 CFR Part 402 Subpart B – Civil Money Penalties and Assessments Hold onto every bill, Explanation of Benefits, and Medicare Summary Notice until the numbers reconcile.