For people enrolled in Original Medicare (Parts A & B) the differences between a participating provider, a non-participating provider, and an opt-out provider, are important to understand and can have a big financial impact.
Non-participating providers may require you to pay the entire charge at the time you receive care, and you may have to file your own claim to receive any reimbursement from Medicare.
Opt-out providers choose not to work with Medicare, meaning your health care bill may be entirely your responsibility, even if you have supplemental insurance.
If you are enrolled in Original Medicare (Parts A & B), it is important to understand the relationship your health care providers have with Medicare. This relationship can directly impact what you pay for certain Medicare services.
Under Original Medicare, your doctors and health care facilities can have one of three relationships with Medicare:
- A participating provider
- A non-participating provider
- An opt-out provider
What is a participating provider under Medicare?
A participating provider has signed up to accept Medicare insurance and agrees to always "accept assignment." A doctor that accepts assignment agrees to accept the Medicare-approved amount as full payment for any Medicare-covered service.
As the patient of a participating Medicare provider, you can expect:
- You will not have to handle the billing paperwork. Your provider will submit your claims to Medicare on your behalf, and Medicare will process the bill and pay the provider directly.
- Once you meet your Medicare Part B deductible, Medicare will pay 80% of the approved amount, and you will be responsible for paying the 20% coinsurance.
- Many Medicare supplement plans (also called Medigap) will cover the 20% you may owe. Consult your Medigap plan for details.
What is a non-participating provider under Medicare?
A non-participating provider has agreed to accept Medicare insurance but not accept assignment. Consequently, non-participating providers may charge up to 15% above the Medicare approved amount for the Medicare-covered service. This extra payment is called the limiting charge. Note that this 15% charge is based on Medicare’s fees for a service amount and not on the amount the provider originally charged.
As the patient of a non-participating provider, you can expect that:
- The provider may require you to pay the entire charge at the time of service.
- Once you meet your Medicare Part B deductible, Medicare will pay their portion based on Medicare’s fee schedule, and you will be responsible to pay up to 35% (20% coinsurance + 15% limiting charge) of Medicare’s approved amount for covered services.
- You may need to file a claim directly with Medicare if the provider does not choose to submit a claim (that is, bill Medicare directly) on your behalf. You can file a claim with Medicare by completing the Patient’s Request for Payment Form CMS-1490S
- Many Medicare supplement/Medigap plans will cover the coinsurance, and some will even cover the limiting/excess charges. Consult your plan policy for details.
What is an opt-out provider under Medicare?
Opt-out providers choose not to work with Medicare insurance. Medicare will not pay for any covered items or services provided by opt-out doctors or other healthcare professionals, except in the case of an emergency or urgent need. Opt-out providers and patients set up mutually agreed upon payment terms under a private contract.
If you are a patient of an opt-out physician, you can expect that:
- The provider will bill you directly for care and services, and you will pay out-of-pocket.
- Neither you nor the provider will submit a bill nor receive reimbursement from Medicare. Opt-out providers are not governed by Medicare’s set fees.
- Most Medicare supplemental policies do not cover services provided by an opt-out provider. Be sure to check your policy for details.
What does this mean if I have Medicare Advantage?
If you’re enrolled in a Medicare Advantage plan, you pay the specific co-pays for doctors’ services that your plan requires. You usually must see a provider within your plan network.
How do I find more information about my health care providers?
It is always a good idea to contact your provider directly if you have questions about their education, board certification, or Medicare provider status. Medicare also offers several tools to help you learn more about the providers currently coordinating your care.
- Use Medicare’s Physician Compare tool to determine whether your provider is participating, non-participating, or an opt-out Medicare provider.
- Find a physician’s board certifications, education, states with active licenses, and any actions against them using the search on DocInfo.org from the Federation of State Medical Boards.
- Medicare’s open payment search tool can be used to search for payments made by drug and medical device companies to physicians, teaching hospitals, and physician assistants.