- Written by Christian Simmons
Christian Simmons is a writer for RetireGuide and a member of the Association for Financial Counseling & Planning Education (AFCPE®). He covers Medicare and important retirement topics. Christian is a former winner of a Florida Society of News Editors journalism contest and has written professionally since 2016.Read More
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- Reviewed ByToby Walters, CFA®
Toby Walters, CFA®
Chartered Financial Analyst and Paraplanner
Toby Walters, CFA®, has over 25 years of financial research experience. With a knowledge and understanding of researching and analyzing financial data, he has developed a unique and experienced viewpoint on money matters. He has been a chartered financial analyst since 2003, and most recently a portfolio analyst and paraplanner.Read More
- Published: August 25, 2021
- Updated: October 23, 2023
- 5 min read time
- This page features 6 Cited Research Articles
The last thing anyone wants is to go to a doctor they think is covered under their Medicare insurance, only to receive a hefty bill a few days later. You can avoid paying these high out-of-pocket costs by understanding Medicare’s assignment of benefits.You can save a lot of money and frustration by knowing the difference between Medicare Participating, Non-Participating and Opt-Out Providers.
What Is Medicare Assignment of Benefits?
Medicare assignment of benefits is a way to identify providers who accept Medicare benefits and those who do not. These providers can be individual physicians, whole hospitals or various suppliers such as physical therapists who work independently. According to the Medicare website:Assignment means that your doctor, provider, or supplier agrees (or is required by law) to accept the Medicare-approved amount as full payment for covered services.
This means that for Medicare to cover the entire cost of a covered service, you’ll need to go to a service provider who accepts assignment.
However, when seeing a provider who hasn’t agreed to accept assignment, you may not be liable for paying much out-of-pocket if you have Medicare Supplement Plan F or Medigap Plan G.
What Happens When Your Provider Accepts Assignment?
When your provider accepts assignment, they agree to receive the pre-approved amount Medicare has outlined for covered procedures as full payment. This reduces out-of-pocket costs and prevents the provider from charging you beyond what Medicare covers for certain services.
While you won’t be liable for paying the whole amount of the services received, Part 3 of the Medicare Carriers Manual states you will still be responsible for paying the deductible and usually 20% coinsurance.
Medicare Enrollment Options for ProvidersThere are three types of enrollment when referring to Medicare assignment:
Each entity can choose whether or not to participate in the Medicare program.
If a doctor at a local clinic doesn’t wish to participate, they can choose not to if they receive payments in their name. If they receive payments through the clinic, they will be at the mercy of the clinic’s decisions. For this reason, you can check with a clinic, hospital or other organization, or with individual doctors, dentists or chiropractors to find out who accepts assignment.
Most providers have the option to opt out of Medicare, but it’s important to note that chiropractors don’t have this option. If you need chiropractic services, the provider will always be either participating or non-participating. The same is true for physical therapists and occupational therapists.
As previously mentioned, participating providers sign an agreement to accept Medicare payments for covered services as payment in full. With participating providers, you’re likely to pay less out of pocket. Likewise, the provider can’t charge you when they submit a claim on your behalf.
Most Medicare beneficiaries will want to find a participating provider as this will lessen their overall health care costs.
Providers who haven’t signed an agreement to accept all Medicare-covered services are considered non-participating. A non-participating provider can choose to accept or not accept assignment on Medicare-covered services.
If your provider is non-participating, you could be liable for the entire amount of your services. Additionally, service providers can charge you up to 15% more than the Medicare-approved amount, even when they accept assignment for a specific service. Supplemental insurance, such as Medigap Plan F or G will likely cover the extra 15%. However, if you don’t have such insurance, you’ll have to pay the additional 15% out-of-pocket.
Though rare, opt-out providers choose not to accept Medicare as a payment option. In most states, less than 2% of providers fall into this category, according to the Kaiser Family Foundation. Medicare doesn’t cover any services by a provider who has opted out of the Medicare program.
If you choose to see an opt-out provider, you’ll have to pay the charges yourself. You can sign a contract with the payment terms directly with the service provider.
How Do I Know If a Provider Accepts Medicare Assignment?
You can find a provider that accepts Medicare assignment by using Medicare’s care comparison tool. After searching for types of providers, specific doctors or specialties, it will show you a list of participating providers in your region and directions to each facility. It will also give you the option to compare providers.
If you’re looking for a new provider after moving out of state or because you need different care, it’s important to find a provider who accepts assignment. This can help lower or eliminate your health care costs, allowing you to use your money for those long-awaited post-retirement plans. Providers who accept assignment will also accept Medigap insurance coverage.
Knowing if a provider accepts your Medicare assignment can decrease your stress and improve your overall experience with the doctor, hospital or the like. You can receive your needed services confidently knowing what you’ll have to pay and what Medicare will cover on your behalf.
While understanding your service provider’s stance on Medicare can help you save money, keeping yourself healthy is one of the best ways to reduce your medical expenses. This is true whether your provider is participating, non-participating or opting out. Use the visual below as a guide for things you can do to take care of your body and avoid seeing the doctor too often.Last Modified: October 23, 2023
6 Cited Research Articles
Need Help Planning Your Retirement? Yes, I'm Interested I Have Help Already I Will Manage It MyselfRetireGuide will soon offer services to help you better manage your retirement.
- Neuman, T., Ochleng, N., Schwartz, K. (2020, October 22). How Many Physicians Have Opted-Out of the Medicare Program? Retrieved from: https://www.kff.org/medicare/issue-brief/how-many-physicians-have-opted-out-of-the-medicare-program/
- Kupka, N. (2018, March 8). 10 Things to Do to Prepare for a Medicare Wellness Visit. Retrieved from: https://thedoctorweighsin.com/10-things-to-do-to-prepare-for-a-medicare-wellness-visit/
- California Health Advocates. (2017, May 16). Medicare Assignment and Costs. Retrieved from: https://cahealthadvocates.org/wp-content/uploads/2016/07/A-004-CHAFactSheet-05.16.17.pdf
- Centers for Medicare and Medicaid Services. (2003, July 11). Medicare Carriers Manual. Retrieved from: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/downloads/R1808B3.pdf
- Medicare.gov. (n.d.) Lower costs with assignment. Retrieved from: https://www.medicare.gov/basics/costs/medicare-costs/provider-accept-Medicare
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