Medicare Reimbursement Explained: Parts A, B, C, D, and Medigap Coverage

If you have Original Medicare (Parts A and B), most of the time, you won’t need to submit claims for reimbursement yourself. However, the procedures for Medicare Advantage (Part C) and Part D differ significantly.

The Centers for Medicare & Medicaid Services (CMS) establishes reimbursement rates for all Medicare-covered medical services and equipment. When healthcare providers accept assignment, they agree to the Medicare-approved fees.

Providers cannot charge you the difference between their usual fees and Medicare’s approved rates. Typically, Medicare payments for Part A and Part B services go directly to the providers.

Keep in mind, you remain responsible for any copayments, coinsurance, and deductibles as outlined by your Medicare plan.

Understanding Part A Reimbursement

Occasionally, you might need to submit a claim if the healthcare facility fails to do so or if you receive a bill from a provider who does not participate in Medicare.

You can monitor your claim status in two ways:

• Reviewing the Medicare Summary Notice sent to you every three months
• Logging into Medicare.gov to track your claims online

How Part B Reimbursement Works

Some nonparticipating doctors might not file claims with Medicare and could bill you directly. When choosing a doctor, ensure they accept Medicare assignment. Nonparticipating providers may require upfront payment and expect you to file the claim.

Medicare generally does not cover services rendered outside the U.S., except in specific situations such as emergencies when no U.S. doctor or facility is nearby. These cases are reviewed individually after claim submission.

Medicare will cover emergency medical services aboard ships if the treating physician is authorized in the U.S. and the emergency occurs far from a U.S.-based facility. Part B beneficiaries can file claims in these scenarios.

Medicare Advantage (Part C) Reimbursement Overview

Since Part C plans are offered by private insurers, you do not file claims with Medicare directly. Instead, claims for covered expenses are submitted to your private insurer.

Part C plans include options like Health Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs), each with specific rules about in-network and out-of-network providers. Seeing an out-of-network provider may require you to submit a claim for reimbursement.

Always inquire about coverage details when enrolling. If you are billed for a covered service, contact your insurance company to learn how to file a claim.

Part D Prescription Drug Reimbursement Explained

Your pharmacy—whether retail or mail order—will submit claims for covered medications. You are responsible for copayments and any coinsurance.

If you pay out-of-pocket for a medication, Medicare does not accept claims from you directly. Instead, you must submit claims to your insurance plan.

If a drug is not covered or costs more than anticipated, contact your plan to discuss coverage options.

You may request reimbursement by completing a Model Coverage Determination Request Form if you've already paid.

If you have not yet paid, you or your doctor can request a coverage determination or exception from your plan. You can also file a written appeal to secure coverage.

Medigap Reimbursement Process

Medigap policies cover only services approved by Original Medicare and impose no network restrictions. Providers accepting Medicare assignment also accept Medigap.

When you visit a provider who accepts assignment, Medicare processes the claim first, then your Medigap plan covers remaining costs according to your benefits. Present both your Medicare and Medigap cards at the time of service.

After Medicare pays its portion, the balance is forwarded to your Medigap insurer, which pays part or all of the remaining costs. You will receive an Explanation of Benefits (EOB) detailing payments.

If billed directly or you paid upfront, you have up to one year from the service date to file a reimbursement claim.

Medicare Reimbursement Rates

Medicare reimbursement rates are fixed amounts paid to physicians for services, compiled in the Physician Fee Schedule (PFS).

To find specific procedure rates, use the PFS Look-up Tool on the CMS website.

You’ll need the CPT code for the procedure and your Medicare Administrative Contractor (MAC) locality key, as rates vary by region.

For example, arthroscopic knee surgery (CPT 29880) in New York's Hudson Valley (MAC locality 1320203) has these rates:

• Non-facility price: $610.89
• Facility price: $610.89
• Non-facility limiting charge: $667.40
• Facility limiting charge: $667.40

Under Part B, Medicare covers 80% of the approved amount based on the PFS; beneficiaries pay the remaining 20% coinsurance.

Reimbursement with Various Healthcare Providers

Participating Providers

Most providers accept Medicare assignment, agreeing to CMS-set fees for covered services.

They bill Medicare directly, so you typically do not need to file reimbursement claims.

Rarely, a participating provider might not file a claim and bill you instead. If this happens, you can report the issue by calling 800-MEDICARE (800-633-4227) or the Inspector General’s fraud hotline at 800-HHS-TIPS (800-447-8477).

Opt-Out Providers

These providers have formally declined Medicare participation and do not accept Medicare payments.

If you use their services, you must pay out-of-pocket, often at rates higher than Medicare-approved fees. Claims cannot be filed for reimbursement unless it’s emergency care.

To avoid unexpected costs, verify provider participation status beforehand. Psychiatrists are a common example of opt-out providers.

CMS offers a tool to check which providers have opted out by searching via National Provider Identifier (NPI) or name.

Nonparticipating Providers

Nonparticipating providers accept Medicare patients but do not accept assignment, meaning they can charge up to 15% above Medicare-approved rates (subject to state limits of 5%).

This surcharge, called the "limiting charge," applies after the 20% coinsurance. Durable medical equipment is exempt from this rule.

Some nonparticipating providers bill Medicare directly; others require you to pay upfront and submit claims yourself.

Special Situations

Providers may ask you to sign an Advance Beneficiary Notice (ABN) if they believe Medicare might not cover a service.

The ABN must specify the reason for potential non-coverage, not be a general warning.

By signing, you accept responsibility for payment if Medicare denies the claim.

Always ask questions and request the provider to file claims with Medicare first to avoid unexpected bills.

Filing a Medicare Reimbursement Claim

If you discover unpaid claims, first ask the provider to file them on your behalf. If they decline, you can submit the claim yourself.

Download the Patient’s Request for Medical Payment form CMS-1490-S from Medicare.gov and follow the instructions carefully:

• Explain why you are filing the claim (e.g., provider failed to submit or billed you directly).
• Include an itemized bill with provider details, diagnosis, service dates and locations, and service descriptions.
• Attach any supporting documentation to assist with reimbursement.

Keep copies of all documents and mail the form to your Medicare contractor. Use the contractor directory or your Medicare Summary Notice to find the correct address, or call 800-633-4227 for assistance.

If you want someone else to file or discuss claims on your behalf, complete the Authorization to Disclose Personal Health Information Release form.

You can view outstanding claims via your Medicare Summary Notice or by logging into Medicare.gov.

Key Takeaways

Original Medicare covers most Part A and Part B services when you use participating providers, so claim filing is rarely needed.

In some instances, you may need to pay upfront and file for reimbursement yourself. For questions, call 800-MEDICARE or your local State Health Insurance Assistance Program (SHIP).

For Medicare Advantage (Part C), Part D, and Medigap plans, claims are handled differently: you file directly with the private plan for Parts C and D, while Medigap covers costs after Medicare processes claims.

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