The phrase “accept assignment” is a specific term in the U.S. healthcare system that defines a provider’s billing relationship with a patient’s insurer, most commonly Medicare. Understanding this concept is directly relevant to a patient’s financial health, as it dictates the maximum amount a provider can charge for a covered service. This agreement transfers the risk of unpredictable medical bills away from the patient and establishes a clear expectation of out-of-pocket costs. Knowing a provider’s assignment status is a necessary step for managing expenses and making informed decisions about healthcare access.
Understanding the Acceptance Agreement
When a healthcare provider agrees to accept assignment, they formally agree to accept the insurer’s established payment rate as the total fee for a covered service. For Medicare, this is known as the Medicare-approved amount, which is the maximum amount the program will recognize for a specific procedure or item. By signing this agreement, the provider promises not to charge the patient more than the standard deductible, coinsurance, and copayment amounts. This means the patient’s financial responsibility is limited to their predetermined share of the approved cost.
This acceptance also places the administrative burden of filing the claim directly on the provider, who submits the bill to Medicare for payment. The provider is prohibited from engaging in “balance billing,” which is the practice of charging the patient for the difference between the provider’s usual fee and the Medicare-approved amount. This arrangement offers patients financial protection and predictability for their medical expenses. The provider receives 80% of the approved amount from Medicare and collects the remaining 20% from the patient after the annual deductible has been met.
Financial Impact on the Patient
The acceptance of assignment creates fixed and transparent out-of-pocket costs for the patient. After the annual Part B deductible is satisfied, the patient is responsible for a coinsurance amount, typically 20% of the Medicare-approved charge for the service. This predictable cost structure enables beneficiaries to budget for their medical care without the concern of unexpected high charges.
In contrast, when a provider does not accept assignment, the patient’s financial exposure increases significantly. The provider can charge up to 15% more than the Medicare-approved amount, a surcharge known as the Limiting Charge. The patient is responsible for this entire excess charge, in addition to the standard 20% coinsurance and any unmet deductible. This means a patient seeing a non-accepting provider could be responsible for up to 35% of the Medicare-approved amount, plus the deductible.
A provider who does not accept assignment may require the patient to pay the entire bill upfront at the time of service. The patient must then submit a claim to Medicare for reimbursement, which can be a complex and time-consuming administrative process. Accepting assignment ensures the provider receives payment directly from the insurer and only bills the patient for their calculated, predetermined share, reducing administrative hassle for the beneficiary.
Provider Status and Billing Options
A provider’s relationship with Medicare can be classified into three distinct categories, each determining their obligation to accept assignment.
Participating Provider
A Participating Provider has signed a formal agreement with Medicare to accept assignment for all covered services and supplies. These providers are obligated to accept the Medicare-approved amount as full payment for all their Medicare patients.
Non-Participating Provider
A Non-Participating Provider accepts Medicare patients but has not signed the agreement to accept assignment for all claims. They retain the option to decide on a claim-by-claim basis whether to accept assignment. If they choose not to accept assignment, they are subject to the Limiting Charge rule, which restricts their maximum billable amount to 115% of the Medicare-approved rate.
Opt-Out Provider
An Opt-Out Provider has formally chosen to leave the Medicare program entirely. These providers sign an affidavit stating they will not bill Medicare for any services provided to beneficiaries for a two-year period. Patients seeing an opt-out provider must sign a private contract and are responsible for paying the provider’s entire fee, as neither the patient nor the provider can seek reimbursement from Medicare.
Identifying Providers Who Accept Assignment
Patients can proactively confirm a provider’s assignment status before receiving care to ensure cost predictability. The most direct method is to contact the provider’s billing staff and specifically ask, “Do you accept assignment for all Medicare-covered services?” This clarifies their status as either participating or non-participating.
The official Medicare website offers an online tool called Care Compare, which allows users to search for doctors and other healthcare facilities. Providers who always accept assignment are often clearly designated with a specific symbol or note indicating they charge the Medicare-approved amount. Utilizing these resources before scheduling an appointment confirms the provider is part of the patient’s cost-protected network.