Patient Financial Responsibility

Special Medicare limitations apply to the amounts and services that doctors can bill their patients. If you have insurance that is supplemental to Medicare, it may pay part or all of these amounts. For covered services, there are two types of claims and associated limitations. They are:

Assigned Claims
The Medicare payment is sent to the doctor. He/she can bill the patient for:

• 20% of the allowed charge. This is also called the co-insurance.
• Any amount that is applied to the annual deductible.
• A service that is denied because it is never covered by Medicare.
• A service that is denied based on medical necessity ONLY if the patient signs a written notice advising of the potential for denial before the service is rendered.

Non-Assigned Claims
The Medicare payment is sent to the patient. The doctor can bill the patient for the entire bill. However, there are special limitations:

• The doctor cannot exceed the limiting charge.
• The doctor cannot bill for any service denied based on medical necessity UNLESS the patient signs a written notice advising of the potential for denial before the service is rendered.

To help you understand what you can be billed for, we are providing definitions of non-covered services versus services denied due to medical necessity.

Non-Covered Services
These are services specifically excluded from Medicare coverage. The patient is responsible for paying for these services. They include:

• Routine exams (includes eye exams)
• Routine tests (e.g., chest x-rays, cholesterol tests, etc.)
• Routine dental care
• Routine foot care
• Immunizations
• Hearing aid tests and hearing aids
• Cosmetic surgery
• Non-essential ambulance transportation
• Self-administered drugs

Medical Necessity Denials
These are services that can be covered by the Medicare program. However, the medical need for each must be substantiated. The patient cannot be billed unless they signed a statement accepting responsibility before the service was rendered. They include:

• Visits
• Laboratory tests
• Diagnostic tests
• Treatment Not Proven Effective
• Surgical procedures
• Chiropractic manual manipulations
• Injections

Note: Medical need is defined as the care that is needed to treat and manage a medical problem.

Written Notice of Non-Coverage
Medicare rules state that a beneficiary cannot be billed for a service denied due to medical necessity reasons. However, the rules also provide the doctor with a way to protect his/her right to bill. The right to bill is protected when the doctor advises the beneficiary in writing of possible non-coverage prior to performing the service. The written notice must include the following information:

• The specific service/item involved
• The date this service/item will be furnished
• Why the service/item may not be covered by Medicare. Example: Treatment not proven effective, diagnosis, concurrent care, frequency of care, and level of service.
• Statement that the patient agrees to pay for the service/item
• The beneficiary's signature
• Date that the beneficiary signed the notice

Be informed! Knowing more about what Medicare will cover and what your financial responsibility is can help you and your doctor make the right decisions about your health care.

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