Ace the Georgia Life & Health Insurance Exam 2025 – Secure Your Success with Confidence!

The term for the difference between the Medicare approved amount for a service and the actual charge is referred to as an excess charge. This situation arises when a healthcare provider bills a patient for the amount that exceeds what Medicare determines is an acceptable charge for that service. It is important because Medicare has set limits on how much it will reimburse providers for specific services, and if a provider charges more than that, the additional cost becomes the responsibility of the patient, unless they are a participating provider who accepts Medicare.

In Medicare, when a provider accepts assignment, they agree to accept Medicare's approved amount as full payment for services rendered. In cases where the provider does not accept assignment, they can charge the patient above the approved amount, which is classified as an excess charge. This terminology is essential for understanding patient responsibility in billing situations under Medicare, particularly in scenarios involving non-participating providers.