Medicare, Medicaid, Life and Health Insurance/part B payments to physicians

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QUESTION: I always thought that Medicare paid 80% of the cost of my physician visit and that my supplement paid the final 20%.  I have learned that there may be another formula for calculating what Medicare pays the doctor and what my supplement pays,. I was told that Medicare pays as little as one third of the cost.  What are the parameters for approved payments by medicare and can my doctor pass the balance on to me?

ANSWER: Loretta, where did you hear this?  The only explanation I have is to point out that Medicare pays as to its 'approved charges'.  It's like a schedule of approved amounts.  Then the supplement pays the other 20%.  By law, the Dr. can bill what's called excess charges, but is limited to 15% above the approved amount.  It depends on your supplement whether these charges will be paid or billed to you.
I hope this helps.

---------- FOLLOW-UP ----------

QUESTION: A doctor told me. Ex: if a doctor's normal fee for a physical is $600. Medicare can approve say only $250. Supplement pays 20%, medicare 80% of that fee.How then does the doctor recoop his expenses associated with that
payment schedule? Can he raise his fees? Does the patient pay?` What is the incentive for doctors to continue to treat medicare patients if they
are losing money?

Answer
Loretta, I see your point, but my first thought is, who says the physical actually costs that much?  and how much is profit?  Everything must have a 'benchmark' and these are normally called 'reasonable and customary' charges.  Think about HMOs - they negotiate with Dr. groups and really stiff them, normally paying a per diem by patient.  That's why you usually get 10 min. of your Dr.'s time, so he can see as many people as he can in one day.  In other words, insurance companies do the same thing as Medicare.  

Medicare, Medicaid, Life and Health Insurance

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