Medicare Assignment of Benefits
Much like beneficiaries, healthcare providers can choose to participate in Medicare each year during an open enrollment period. For providers, this period is from mid-November to the end of December. Over 98% of doctors, hospitals, and healthcare providers choose to participate in Medicare. This Medicare assignment of benefits data is from as recently as 2022.
When a provider chooses to participate in Medicare, they are choosing to accept claims assignments for all Medicare-covered services to their patients. This means that they accept the amount that Medicare pays for these services as full payment. Healthcare providers may not collect more from the patient than the Medicare-approved assignment, or amount, in the deductible fee or Medicare copay. For participating providers, Medicare pays them directly and forwards their claims to Medigap insurance providers. For non-participating providers, Medicare pays them 5% less than the approved-amount. Those non-participating providers cannot charge their patients who are covered by Medicare more than 115% of the approved amount for the service according to the Medicare Physician Fee Schedule.
What’s the Impact to Beneficiaries?
For beneficiaries, there are different procedures for using a provider that does participate in Medicare, or accepts assignment, versus one who does not accept assignment. For providers who do accept assignment, the Medicare beneficiary may have lower out-of-pocket costs. They will only be charged their Medicare deductible and copay amounts, and then Medicare will pay their healthcare provider directly. The participating healthcare provider also submits the claim to Medicare on their own and does not charge the beneficiary a fee for doing so.
If a healthcare provider does not accept assignment, or opts out of Medicare participation, the beneficiary may be asked to pay the full fee for the service at the time of service. The healthcare provider can also charge up to 15% more for the service than if they were participating in Medicare.
For most beneficiaries, choosing doctors and hospitals who accept assignment can save them out-of-pocket costs. Additionally, for most providers, it makes good business sense to increase their clientele by participating in Medicare and accepting assignment.
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