Medicare Part B excess charges are the extra amount you pay when a doctor bills more than the Medicare-approved price for a service. This can only happen with non-participating providers, and the extra charge is capped at 15% above the Medicare-approved amount. While excess charges are a real cost to watch for, they affect a relatively small number of visits since 98% of non-pediatric physicians participate in Medicare and accept its standard rates as full payment.
How Excess Charges Work
Every medical service covered by Part B has a Medicare-approved amount, set through the annual Physician Fee Schedule. When a doctor is a “participating provider,” they’ve agreed to accept that approved amount as payment in full. You pay your standard 20% coinsurance, Medicare pays its share, and nobody bills you anything beyond that.
Non-participating providers are different. They’ve enrolled in Medicare but haven’t agreed to accept the approved amount on every claim. On claims where they don’t accept assignment, they can charge up to 15% more than their fee schedule amount. This extra cost above Medicare’s approved rate is the excess charge, and it comes out of your pocket. The 15% ceiling is called the “limiting charge,” and it’s been in effect since 1991.
There’s an additional wrinkle that makes the math slightly more complex. Non-participating providers are paid at a rate 5% lower than participating providers for the same service. The 15% limiting charge is calculated on top of that reduced rate, not the full participating rate. So the actual dollar amount of the excess charge is somewhat smaller than you might expect from just hearing “15% extra.”
A Dollar Example
Say the Medicare-approved amount for an office visit is $200 for a participating provider. A non-participating provider’s fee schedule amount would be $190 (5% less). The limiting charge, at 115% of $190, comes to $218.50. You’d be responsible for the difference between the Medicare-approved amount and $218.50, plus your regular 20% coinsurance. The excess charge portion itself would be $28.50.
For routine visits, these amounts are manageable. But for expensive services like imaging, outpatient surgery, or specialty consultations, a 15% excess charge can add hundreds of dollars to your bill. Non-participating surgeons planning non-emergency procedures expected to cost $500 or more are legally required to give you a written estimate beforehand, including what Medicare will likely pay and what you’ll owe out of pocket. You must sign this notice before the surgery.
Non-Participating vs. Opted-Out Providers
It’s worth understanding that non-participating providers and opted-out providers are two completely different situations. Non-participating doctors still work within the Medicare system. They submit claims to Medicare, the limiting charge caps what they can bill you, and Medicare reimburses its share of the cost (either to you or the provider, depending on assignment).
Opted-out providers have left the Medicare program entirely. They enter private contracts with patients and can charge whatever they want with no cap at all. Medicare pays nothing toward these services. About 1% of non-pediatric physicians have formally opted out as of 2024. This is a far more expensive scenario than excess charges, so it’s important to know the difference before booking an appointment.
How Common Are Excess Charges?
In practice, excess charges are relatively uncommon. According to KFF, 98% of physicians and practitioners billing Medicare are participating providers who accept assignment on all claims. That means they’ve agreed to the Medicare-approved amount as full payment, and excess charges simply don’t apply.
The remaining non-participating providers can also choose to accept assignment on individual claims. A non-participating doctor might accept assignment for one patient’s visit but not another’s. When they do accept assignment, the excess charge rules don’t apply to that claim. So even seeing a non-participating provider doesn’t guarantee you’ll face excess charges.
That said, certain specialties and geographic areas have higher concentrations of non-participating providers. If you’re seeing a specialist for an expensive procedure, checking assignment status in advance is worth the few minutes it takes.
States That Ban Excess Charges
Eight states prohibit providers from billing Medicare Part B excess charges: Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont. If you live in one of these states and receive care there, you’re fully protected.
The protection is tied to where you receive care, not just where you live. If you’re a New York resident who sees a doctor in New Jersey, that visit isn’t covered by New York’s ban. You could face excess charges on that out-of-state claim.
How to Check a Provider’s Status
Before scheduling an appointment, you can look up any doctor’s Medicare assignment status on Medicare’s online compare tool at Medicare.gov. The profile page for each doctor and group practice lists whether they accept Medicare assignment. If a provider is listed as participating, excess charges won’t be an issue.
You can also call the provider’s billing office directly and ask two questions: “Are you a participating Medicare provider?” and “Will you accept assignment on my claim?” The second question matters because non-participating providers can accept assignment on a case-by-case basis. Getting a clear answer before your visit prevents surprises.
Medigap Plans That Cover Excess Charges
If you have Original Medicare and want protection against excess charges, two Medigap (Medicare Supplement) plans cover them at 100%: Plan F and Plan G. No other standardized Medigap plan letters cover this benefit. Plan N, for instance, which is popular for its lower premiums, does not cover excess charges at all.
Plan F is only available to people who became eligible for Medicare before January 1, 2020. For anyone who turned 65 after that date, Plan G is the main option for excess charge coverage. When comparing Medigap premiums, consider how likely you are to encounter excess charges. If you live in one of the eight states that ban them, or if all your doctors are participating providers, paying a higher premium specifically for this benefit may not be worth it.
Medicare Advantage plans handle billing differently from Original Medicare and generally use provider networks, so excess charges as described here are specific to Original Medicare with or without a Medigap supplement.