Medicare Plan N Excess Charges
Plan N excess charges are one of the most misunderstood trade-offs for people exploring Medicare Supplement (Medigap) options. Medicare Plan N can offer lower premiums than Plan G, but it does not cover Medicare Part B excess charges. If you’ve ever wondered what excess charges are, whether they’re common, or whether they should influence your plan choice, this breakdown will give you clarity.
What Are Medicare Excess Charges?
Excess charges occur when a doctor or medical provider does not accept Medicare Assignment. Medicare Assignment means the provider agrees to accept Medicare’s approved amount as full payment for a service. When a provider doesn’t accept assignment, they are legally allowed to bill up to 15% more than the Medicare‑approved amount. That additional 15% is the “excess charge.”
Medicare.gov explains the provider billing rules behind Plan N excess charges.
For example, if Medicare approves $200 for a service, a non‑participating provider could charge up to $230. Medicare would still pay its portion based on the $200 amount, and the beneficiary is responsible for the extra $30. Medigap Plan G covers these excess charges entirely. Plan N does not. That’s why excess charges often come up when comparing the two plans.
How Often Do Excess Charges Actually Occur?
Here’s the part that surprises most people: excess charges are extremely rare.
More than 96% of U.S. physicians accept Medicare Assignment, meaning they cannot bill excess charges at all. In some states like Pennsylvania, Connecticut, and Massachusetts excess charges are outright prohibited by state law. In many others, they’re simply uncommon because providers prefer the simplicity of accepting Medicare’s rates.
Even among the small percentage of providers who can bill excess charges, many choose not to. The administrative burden, combined with patient dissatisfaction, makes excess charging unattractive for most practices. As one industry expert put it, “Excess charges are one of those things that sound scary on paper but rarely show up in real life.”
Why Plan N Still Makes Sense for Many Beneficiaries
Because excess charges are so uncommon, many Medicare beneficiaries choose Plan N to save money on premiums. Plan N typically costs $20–$40 less per month than Plan G, depending on the state and carrier. Over time, that difference adds up. Plan N does require small copays up to $20 for office visits and up to $50 for emergency room visits (unless admitted). But for people who don’t visit the doctor frequently, these copays are often manageable. The real question becomes: Is the small risk of excess charges worth the premium savings? For many, the answer is yes.
What Insurance Leaders Say About Excess Charges
Several well‑known Medicare experts have publicly commented on the topic in recent years.
Jesse Slome, Executive Director of the American Association for Medicare Supplement Insurance (AAMSI), has noted in interviews that excess charges “shouldn’t be the deciding factor for most consumers,” emphasizing that the frequency of excess billing is “far lower than people assume.” AAMSI official site: https://www.medicaresupp.org/about/
And Paul Gada, Senior Financial Wellness Advocate at UnitedHealthcare, has said publicly that beneficiaries should “focus more on provider access and total cost of care than on excess charges,” calling them “a minimal concern in today’s Medicare landscape.” UnitedHealthcare Newsroom: https://www.uhc.com/news-articles/newsroom
These perspectives align with what many brokers and analysts see daily: excess charges are technically possible, but practically rare.
How to Avoid Excess Charges Entirely
If you’re considering Plan N but still feel uneasy, there are simple ways to eliminate the risk:
- Ask your providers whether they accept Medicare Assignment. Most do.
- Use Medicare’s Physician Compare tool to verify a provider’s status.
- Avoid non‑participating providers unless absolutely necessary.
- Know your state laws some states ban excess charges altogether.
With these steps, you can confidently choose Plan N without worrying about surprise bills.
The Bottom Line
Medicare Plan N excess charges are one of the most misunderstood aspects of Medigap coverage. While they’re technically possible, they’re rarely encountered and often avoidable with basic provider awareness. For many beneficiaries, the premium savings of Plan N outweigh the small theoretical risk of excess charges.
If you’re comparing Plan N and Plan G, think about your budget, your doctor visit frequency, and your comfort level with small copays. Excess charges shouldn’t be the deciding factor they’re simply not common enough to drive most people’s plan choice.
For help comparing Medicare Supplement options, contact Cassondra Neale at cassondra@icusa-tx.com or call 940-382-4700 to discuss your questions about Plan N excess charges.
