One of the selling points of Medigap Plan G over Plan N is coverage for Medicare Part B excess charges. Plan G covers them; Plan N does not. But how often do excess charges actually occur, how much can they cost, and is this a meaningful factor in choosing between the two plans? The answer depends partly on where you live and where you get care, and for most people, the excess charge exposure is smaller than the marketing around it suggests.
Excess charges are more of a concern in certain markets than others. I have worked with clients in states where they are legally prohibited, making the G versus N choice straightforward. And I have worked with clients in markets where a meaningful share of specialists do not accept assignment. Know your market and your specific providers. If your cardiologist or oncologist does not accept assignment, Plan G's protection has real value.
What Medicare assignment means
Medicare has approved payment rates for every covered service. When a doctor accepts Medicare assignment, they agree to accept that amount as full payment. When you see an assignment-accepting provider under Original Medicare, you pay 20% of the approved amount and Medicare pays 80%. No excess charges apply. The overwhelming majority of physicians and other Medicare providers accept assignment. CMS data consistently shows assignment acceptance rates above 97% among active Medicare providers.
What happens with non-participating providers
Doctors who participate in Medicare but do not always accept assignment on a given claim are called non-participating providers. Non-participating providers can charge up to 15% above the Medicare-approved rate for services. If Medicare approves $100 for a service and a non-participating provider charges $115, the excess $15 is the excess charge. You are responsible for both your 20% share of the approved amount ($20) and the $15 excess charge, for a total of $35 instead of $20.
Opt-out providers are different
A small number of providers opt out of Medicare entirely. These doctors have signed an opt-out affidavit and do not bill Medicare at all. When you see an opt-out provider, Medicare pays nothing. You and the doctor have a private contract, and you pay whatever they charge. This is distinct from excess charges, which only apply to non-participating providers who still participate in Medicare but charge above the approved rate.
Which states prohibit excess charges
Several states have enacted laws that prohibit Medicare excess charges entirely. Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont do not allow providers to charge above the Medicare-approved amount. In these states, the distinction between Plan G and Plan N on this point is moot, there are no excess charges to cover.
Weighing Plan G against Plan N and not sure how excess charges factor in for your situation?
The excess charge question usually comes down to who you see and where you live. I can help you think through whether it is a meaningful factor given your specific providers and zip code.
Book a Free CallWhich Medigap plans cover excess charges
Plans F and G cover Part B excess charges in full. Plan N does not. In practice, this means choosing Plan N exposes you to potential excess charges from non-participating providers. If you receive care exclusively from assignment-accepting providers, the difference between G and N on this point has no practical impact.
The practical reality
For most Medicare beneficiaries who use large hospital systems, academic medical centers, or primary care practices affiliated with health networks, excess charges are rarely encountered. These institutions almost universally accept Medicare assignment. Excess charges are more commonly encountered with certain independent specialists, particularly in some specialties and in some geographic markets. If you see a specialist who does not disclose whether they accept assignment, ask before the appointment. Assignment status is also searchable on the CMS physician compare database.
Frequently asked questions