In most cases, a person does not need to file for reimbursement when using a provider contracting with Original Medicare. This is more likely with Part C plans requiring an in-network provider. A person may need to follow the guidelines of their specific plan.
With some exceptions, people enrolled in Original Medicare (parts A and B) do not pay upfront for their healthcare when they choose a Medicare-enrolled healthcare professional or facility.
Medicare usually pays healthcare professionals directly for treatment, though an insured person must meet out-of-pocket expenses before Medicare will pay for medical services. For this reason, individuals typically do not have to submit a claim to Medicare to reimburse their healthcare costs.
That said, a person enrolled in Medicare Advantage (Part C) may need to file for reimbursement if they use certain doctors or facilities.
This article explores the process for requesting reimbursement for Medicare plans and providers that require it.
Glossary of Medicare terms
- Out-of-pocket cost: This is the amount a person must pay for care when Medicare does not pay the total amount or offer coverage. Costs can include deductibles, coinsurance, copayments, and premiums.
- Premium: This is the amount of money someone pays each month for Medicare coverage.
- Deductible: This is an annual amount a person must spend out of pocket within a certain period before Medicare starts to fund their treatments.
- Coinsurance: This is the percentage of treatment costs that a person must self-fund. For Medicare Part B, coinsurance is 20%.
- Copayment: This is a fixed dollar amount a person with insurance pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
A person has the option of signing up for Medicare Advantage (Part C), which is an alternative to Original Medicare (parts A and B) that provides the same benefits via a private insurance plan.
Some Part C plans ask an insured individual to use doctors and facilities within their network. Two examples are Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO) plans, though HMO and PPO plans have different network requirements.
Networks are pools of healthcare professionals who have contracted with the plan. An individual enrolled in Part C who sees an out-of-network professional may need to pay the professional upfront, then file a claim for reimbursement from their plan.
The person will pay the full cost. This includes costs beyond what Medicare usually covers, known as coinsurance, and their monthly premium. They also will need to meet their deductible before getting coverage.
It also is important to understand that Medicare allows out-of-network professionals to charge up to 15% more than the approved amount for their services. Medicare calls this the limiting charge. Some states set a lower limiting charge. For example, in New York, the limiting charge is 5%.
Anyone who needs to pay for healthcare services upfront and claim for reimbursement can expect to go through the following steps:
Steps to file a Medicare reimbursement
- An individual will receive a healthcare service from a nonparticipating provider.
- The individual will pay the full cost of the services to the healthcare professional directly.
- The healthcare professional has 1 year to submit a bill for their services to a Medicare administrative contractor on behalf of the individual.
- If the professional does not file within the time limit, an individual must complete the Patient Request for Medical Payment form (CMS-1490S) by following the instructions. They must also provide itemized bills and a letter explaining why they are personally submitting a claim.
- The individual will receive a Medicare summary notice (MSN) in the mail every 4 months, outlining any reimbursement claims. The individual can also log into MyMedicare.gov to check the status of any claims.
- Medicare Part B will reimburse 80% of the Medicare-approved amount for the healthcare services the individual receives.
Original Medicare includes Part A insurance, which covers in-hospital care, and Part B, which covers medical costs. People with Original Medicare generally see Medicare-certified healthcare professionals who can accept assignments from Medicare and submit claims directly to the government for payment of their services.
Medicare then reimburses the medical costs directly to the service provider. This means the insured person will not have to pay the bill for medical services upfront and then file for reimbursement. Providers have an agreement with Medicare to accept the Medicare-approved payment amount for their services.
Exceptions
Certain healthcare professionals may still require filing for reimbursement from Original Medicare. This is typically a nonparticipating provider, which is a healthcare professional not contracted with Medicare who can still choose to accept a patient insured by the plan.
As in the case of Part C plans, these healthcare professionals can charge a person more for the same service and may request direct payment from the person at the time of service. That said, the person can submit a reimbursement claim after the fact.
A person can also see an opt-out provider, which is a health professional whom Medicare cannot reimburse. In this case, the person is fully responsible for the cost of their care.
Medicare has predetermined reimbursement amounts that it pays doctors for their services, which are detailed in the physician fee schedule (PFS). To find rates for specific procedures, a person can use the PFS lookup tool on the CMS website and enter the current procedural terminology code for the desired procedure and the ZIP code where they intend to undergo it.
Under Medicare Part B, Medicare covers 80% of service costs per the PFS, while enrollees are responsible for the remaining 20% as coinsurance.
For Part A, once a person meets their deductible, they will be fully covered for the first 60 days of a hospital stay and the first 20 days at a skilled nursing facility. After that, they incur an additional daily cost, meaning that Medicare would reimburse the remaining share.
That said, since hospitalization in the United States is costly, a person may wish to undergo any inpatient procedure at a facility that contracts with Medicare to reduce costs and avoid having to file for reimbursement.
For Part C plans, reimbursement is based on the plan’s coinsurance or copay, which varies by plan.
Medicare Part D covers prescription drugs. Private insurance companies also administer these plans.
An individual usually pays a monthly insurance premium for Part D coverage. They must purchase their prescription medications from an agreed-upon network of pharmacies.
Medicare reimburses eligible prescription drug costs directly. An insured person claiming medications under Part D needs to meet out-of-pocket expenses only.
Medicare supplement insurance, or Medigap, is a privately administered plan that may help an individual with Original Medicare meet their out-of-pocket expenses. However, most new Medigap plans do not cover the Part B deductible.
There are 10 standardized Medigap insurance plans. People can compare different Medigap plans on the Medicare website. The states of Massachusetts, Minnesota, and Wisconsin standardize their plans differently.
If an individual has Original Medicare and a Medigap plan, the law requires that a provider file claims for their services. An individual should not need to file a claim for reimbursement.
When receiving healthcare services, people should present their Medicare and Medigap cards together. Medicare must approve the Original Medicare claim first before it approves payment from Medigap.
The insured person will need to submit a Medigap claim only if the healthcare professional does not. To do so, they can:
- Request a claim form from the insurance company.
- Complete the form and attach copies of itemized bills from the service provider.
- Include a copy of the MSN, which details the bills.
- Submit the claim to the private insurance company that administers the Medigap plan.
Medicare plans do not reimburse monthly premiums. That said, a person can get the premium back or be exempt from paying it in some scenarios.
This includes deducting the premium from a person’s Social Security Disability Insurance (SSDI) or Railroad Retirement Board (RRB) payments and qualifying for the low income subsidy.
A person may also get reimbursed for their Part D premium if they paid out of pocket for their prescriptions before receiving their plan membership card or confirmation letter.
For Part C plans, a person may need to log into their plan account or contact their plan directly for reimbursement status. For Original Medicare, a person must check their claim on Medicare.gov or call 800-MEDICARE (800-633-4227) or 877-486-2048 for TTY users.
Generally, an individual should not need to submit a claim for Medicare reimbursement, as the provider is responsible for filing a claim
However, under certain circumstances, a person may have to complete and file a claim for reimbursement.
