What is Medicare Part B?

Part B is the category of insurance coverage within Medicare that covers various outpatient medical services and other doctor services. Medicare-eligible individuals must enroll in Medicare Part B in order to receive Part B benefits. Medicare Part B has a monthly premium of $96.40 in 2008. Medicare Part B also has an annual deductible of $135. As stated earlier, Medicare Part B is an optional program that an eligible individual may choose to enroll in or remain unenrolled.

Medicare Part B covered services are reimbursed at 80% of the "reasonable charge" for the service with the Medicare beneficiary responsible to pay the remaining 20%. However, this charge is determined by Medicare and may not adequately reflect the costs your pay to your physician. Consequently, a Medicare beneficiary may pay more than 20% of the bill for a Part B covered service if his or her doctor's service price is more than the "reasonable charge" set by Medicare.

When a doctor agrees to accept the Medicare set "reasonable charge" as full payment, he or she is said to accept "assignment." When a doctor does not accept "assignment" the patient is responsible to pay the outstanding balance minus the Medicare-determined reimbursement. However, federal law sets a limit as to the maximum amount a doctor may bill for a service. The maximum amount to be billed for a Medicare Part B covered service is 115% of the Medicare "reasonable charge." If the doctor bills above this cap, he or she violates federal law.

Some of the important medical services covered by Medicare Part B are:

Medicare Part B does not cover various items including:

Medicare Supplement Plans, also known as Medigap plans, are private insurance plans that cover a variety of costs not paid for by Medicare. Our tools can help you review Medigap plans to help you determine if there is a plan that meets your budget as well as your insurance needs.

For more information on the various plans, return to our Medicare page. The government’s official web site for the Medicare program is www.medicare.gov. This site has information on various Medicare programs as well as detailed eligibility criteria. Another site, mymedicare.gov, also contains information on Medicare programs.