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Why Doesn’t Medicare Reimbursement Cover 100% of My Medical Bills?


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Contributing expert: Kelly Blackwell, Certified Senior Advisor®
Updated: March 30, 2022


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Kelly Blackwell
Certified Senior Advisor (CSA)®
Kelly Blackwell
Certified Senior Advisor (CSA)®

Kelly Blackwell is a Certified Senior Advisor (CSA)®. She has been a healthcare professional for over 30 years, with experience working as a bedside nurse and as a Clinical Manager. She has a passion for educating, assisting and advising seniors throughout the healthcare process.

Medicare, our nation’s federal health insurance program, is primarily funded by federal income taxes, payroll taxes, and beneficiary premiums. Medicare covers a portion of, but not all, basic healthcare expenses. The Centers for Medicare and Medicaid Services (CMS) determines reimbursement rates for Medicare providers. Medicare beneficiaries share the costs of covered services in the form of deductibles, coinsurance, and copays.

How Does Medicare Reimbursement Work?

Medicare doesn’t cover 100% of your medical bills. Generally, you’re responsible for covering deductibles and 20% coinsurance. If you use a nonparticipating provider, you may be responsible for additional charges.

Original Medicare

If you receive Medicare-covered services from participating providers, claims are submitted for you. You are responsible for paying your share of costs to your provider, and Medicare will reimburse your provider for its share. For instance, you owe a 20% coinsurance based on the approved Medicare charge if you visit your doctor. Medicare will pay your provider 80%. This cost-sharing begins after you meet your annual Part B deductible ($233 in 2022).

If you use a non-participating provider, one that does not accept assignment, they should submit a claim to Medicare for any Medicare-covered services they provide. You are responsible for 20% coinsurance plus up to an additional 15% of the charges. You may have to pay the entire charge at the time of service, and you may have to file your own claim. If your provider doesn’t submit the claim to Medicare once you ask them to, call (800) MEDICARE or (800) 633-4227. TTY users can call (877) 486-2048.

If your provider has opted out of Medicare, you are responsible for all costs. Medicare will not reimburse you or your provider.

Your Medicare Summary Notice (MSN) lists all your services billed to Medicare. It shows what Medicare paid and what you owe your provider. You can access your MSN online at your secure Medicare account at Medicare.gov or have it mailed to you every three months:

  • Review your MSN for accuracy. If you disagree with Medicare’s decision not to pay for a service, the MSN will tell you how to appeal.
  • Review your MSN to make sure your claims are filed on time. Providers have one year from when services are rendered to file a claim.
  • Your MSN will tell you if you’re enrolled in the Qualified Medicare Beneficiary (QMB) program. If you are in the QMB program, Medicare providers cannot bill you for Medicare Part A and/or Part B deductibles, coinsurance, or copayments. If you already paid for services and items Medicare covers, you have the right to a refund.

Suppose your provider doesn’t think Medicare will pay for a service or supply. In that case, you should receive an Advance Beneficiary Notice of Noncoverage (ABN) outlining your expected costs and why Medicare may not pay. You can ask your provider to file a claim, but you must accept responsibility for the full charge. If a claim is filed, you have the right to an appeal.

Medicare doesn’t cover all healthcare expenses. For instance, if you need long-term care (custodial care) or dentures, you are responsible for all costs unless you have benefits from another healthcare plan.

There is no annual cap or limit on the amount you may have to pay for out-of-pocket expenses with Original Medicare.

Medicare Part A

Medicare Part A (hospital insurance) covers:

  • Inpatient care in a hospital
  • Medically necessary care in a Medicare-certified skilled nursing facility (SNF)
  • Limited care in a skilled nursing facility (SNF) after a qualifying hospital stay
  • Hospice care
  • Some home healthcare

Deductibles and coinsurance charges apply. For instance, if you are hospitalized, the 2022 Part A deductible for one benefit period is $1,556. If you are in the hospital for more than 60 days, you owe a daily coinsurance of $389. Providers will submit claims for you.

Medicare Part B

Medicare Part B (medical insurance) covers medically necessary outpatient services and supplies after you pay an annual deductible ($233 in 2022). Providers should submit claims for you. Your share of costs is usually 20% of the Medicare rate. Part B also covers preventive care and services, typically at no cost to you if you use a participating provider.

Medicare Part C

Medicare Part C (Medicare Advantage) is an alternative way to get your Medicare Part A and Part B benefits. Medicare-approved private insurance companies offer Medicare Advantage Plans. Medicare regulates Medicare Advantage Plans, but each insurer sets its own rules about how you obtain services.

Medicare pays the private insurance company a set amount per month for each enrollee, so insurers do not file claims with Medicare. The cost-sharing structure is different from Original Medicare. For instance, you typically pay a copay instead of a coinsurance percentage if you visit a doctor. In-network providers should submit claims to the insurer for you. If you receive services from out-of-network providers, you may have to pay upfront and submit your own claim. Your plan will provide detailed instructions for how you do this.

All Medicare Advantage Plans have an annual out-of-pocket maximum that you may spend on Medicare-covered services. Medicare Advantage Plans offer other benefits not covered by Medicare, such as prescription drug coverage and dental, vision, and hearing exams. Your out-of-pocket expenses for noncovered Medicare services do not apply toward your annual maximum.

Most plans have network providers and may require referrals for specialist care or prior authorizations for procedures and drugs. If you don’t follow the plan’s rules for getting your benefits, you may be responsible for the full amount of charges.

Each plan’s Evidence of Coverage (EOC) details what is covered and what you must pay.

You will receive an Explanation of Benefits (EOB) listing services billed and how much you owe.

Medicare Part D

Medicare Part D (prescription drug coverage) plans are offered by Medicare-approved private insurance companies. These plans charge a monthly premium and help pay for costs associated with outpatient prescription drugs. The amount you pay for drugs varies depending on your plan’s formulary (list of drugs), which tier (low to higher costs) your drug is on, which pharmacy you use, and which phase of drug coverage you are in. Your pharmacy should submit the claim to your insurer for you if you stay in-network.

You will receive an EOB listing your prescription drug claims and costs.

Medicare Supplemental Insurance (Medigap)

Medigap policies are offered by Medicare-approved private insurance companies. These policies help pay your portion of costs when you obtain Original Medicare Part A and Part B covered services. For instance, your Medigap policy will cover your deductible if you are hospitalized. If you visit your doctor for outpatient care, your Medigap policy will cover your 20% coinsurance charge after meeting the Part B annual deductible. Compare benefits of Medigap plans here.

Make sure your provider has your Medicare number and Medigap policy information on file. Your provider will submit your claim to Medicare for you. Medicare will forward the processed claim to your Medigap insurer.

You pay a monthly premium for a Medigap policy. Rates among insurers vary depending on your age, gender, tobacco use, and state of residence. If you don’t enroll in a Medigap plan when you are first eligible, your premium may be higher due to your health status.

You cannot have a Medicare Advantage Plan and a Medigap policy simultaneously.

How Do You File a Medicare Reimbursement Claim?

A reimbursement claim is a request for payment that you submit to Medicare or other health insurance when you get items and services that you think are covered.

If you have Original Medicare Parts A and B, you shouldn’t have to file a claim for covered services and supplies. Your provider must file claims for you within one year from the date services were provided. If your provider has not filed your claims in a timely manner, you may have to file a claim, but this is unusual. If you have a Medigap policy to help pay for your portion of Original Medicare costs, your provider should file a claim for you.

Check your MSN to make sure that claims have been filed. If you have to file a claim yourself, fill out the Patient Request for Medical Payment form (CMS-1490S) [PDF, 52KB). The Spanish version of the claim form is CMS-1490S.

In addition to the claim form, be sure to include:

  • The itemized bill from your doctor, supplier, or other healthcare provider
  • A letter explaining in detail your reason for submitting the claim (for example, your provider isn’t able or refuses to file the claim or your provider is not enrolled in Medicare)
  • Any supporting documents related to your claim

Send the claim to the address found on your MSN.

If you have a Medicare Advantage Plan, your in-network providers should file claims with your insurer for you. You may have to file your own claim if you receive services from out-of-network providers or haven’t gotten necessary referrals or authorizations prior to receiving services. Contact your plan for how and when to file a reimbursement claim. Medicare Advantage Plans have a limited time frame for you to submit a claim.

If you have a stand-alone Part D prescription drug plan, your pharmacy should file claims with your insurer for you. You are responsible for an annual deductible before your plan pays. If you have to file a claim for reimbursement, contact your plan for instructions.

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