If you have original Medicare, the doctor you visit can make a difference in how much you have to pay. Although you can go to any doctor who accepts Medicare payments, if the doctor does not "accept assignment" or opts out of Medicare, you can end up paying a lot more.
Medicare Part B recipients must satisfy an annual deductible. Once the deductible has been met, Medicare pays 80 percent of what Medicare considers a "reasonable charge" for the item or service. The beneficiary is responsible for the other 20 percent.
However, in most cases what Medicare calls a "reasonable charge" is less than what a doctor or other medical provider normally charges for a service. Whether a Medicare beneficiary must pay part of the difference between the Medicare-approved charge and the provider's normal charge depends on whether or not the provider has agreed to participate in the Medicare program.
If your doctor participates in Medicare, it means that the doctor "accepts assignment." In other words, the doctor agrees that the total charge for the covered service will be the amount approved by Medicare. Medicare then pays the provider 80 percent of its approved amount, after subtracting any part of your annual deductible that has not already been met. The provider then charges you the remaining 20 percent of the approved "reasonable" charge, plus any part of the deductible that has not been satisfied.
If your doctor does not accept assignment, the rules are different. Non-participating doctors can charge beneficiaries 20 percent of the approved amount plus up to an additional 15 percent more than the Medicare-approved amount. Non-participating doctors can also charge you the entire bill for the care upfront and request that you bill Medicare for reimbursement, while doctors who accept assignment cannot. Note that if you have Medigap plans F and G, they will cover the additional 15 percent charges (however, as of January 1, 2020, plan F is no longer sold).
Doctors can also choose to opt out of Medicare altogether. This means the doctor will not submit any claims to Medicare for reimbursement. If your doctor opts out of Medicare, you will be responsible for the full amount of your bill.
The payment system under Medicare Advantage is different because doctors contract with Advantage’s HMO or PPO plans and agree to the plan’s payment terms. As far as your payment responsibilities go, your plan will require specific copays and deductibles, which will vary plan by plan. Remember that at any time, Medicare Advantage plans can make changes to which doctors they cover, and doctors can choose to join or leave plans, so having a Medicare Advantage plan does not mean your doctor will always be covered. If your doctor leaves your plan’s network and you want to keep your doctor, you may need to switch plans to have your bills covered.
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