Periodically, we get calls at the Center asking if a physician participating in Medicare can charge an “administrative” or “annual” fee to patients covered by Medicare. Medicare prohibits such a fee for participating providers.
Why These Fees Are Generally Prohibited
Most physicians are “participating providers,” meaning they have signed an “assignment agreement” with Medicare. Under this agreement, the physician agrees to accept the Medicare-approved amount as full payment for covered services. This includes the amount reimbursed by Medicare as well as any copayment or deductible from the Medicare beneficiary. Charging an additional fee on top of the Medicare payment constitutes “double billing” and is a violation of the Medicare Act for the following reasons:
- Covered Services Included: The services bundled into “administrative fees” – such as care coordination, comprehensive assessments, or “extra time” spent with patients – are already covered and reimbursed by Medicare.
- Access Charges are not permitted: Medicare does not permit a physician to charge an “access fee” or “administrative fee” simply to allow a patient to receive Medicare-covered services from a physician.
Note: Some physicians are “nonparticipating providers.” This means that, rather than billing Medicare directly, they bill the patient and have the patient seek reimbursement from Medicare. These providers must still limit their charges to Medicare beneficiaries.
Generally, non-participating providers may not charge Medicare beneficiaries more than 15 percent in excess of the Medicare fee schedule amount. It is illegal to charge patients more than the limiting charge established for physicians’ services.
Physicians who have completely “opted out” of Medicare and do not bill the program at all may charge private fees.
What if the physician claims the fee is “for services not covered by Medicare?”
The Office of the Inspector General of the U.S. Department of Health and Human Services (OIG) has warned that even if a physician characterizes services as “not covered,” they are often found to be services Medicare has already paid for. Providers who engage in this practice face substantial civil monetary penalties and potential exclusion from the Medicare program. See OIG Alert and OIG Physician Guide on Payers.
What Should I Do If I am Charged an Extra Fee?
If your doctor asks you to pay an administrative or annual fee to remain a patient, you have options:
- Ask Your Physician about the Extra Fee:
- What services are included in the fee?
- Are any of the services covered by Medicare reimbursement? If not, why not?
- Challenge the “Non-Covered” Label: If the fee covers “coordination of care,” “prescription facilitation,” or “priority appointments,” inform the office that the OIG considers these potentially covered services and that charging extra for them may violate their Medicare assignment agreement.
- Provide a copy of the OIG Alert warning providers against charging extra fees.
- Do Not Feel Compelled to Pay: You are only legally responsible for any applicable Medicare deductible, copay, or coinsurance for covered services.
- Seek Assistance
- Call 1-800-MEDICARE (1-800-633-4227).
- Beneficiary and Family Centered Care Quality Improvement Organization (BFCC-QIO): These organizations are contracted by Medicare to review patient complaints regarding the quality and necessity of care, as well as billing grievances.
- Medicare Beneficiary Ombudsman: This federal advocate works to ensure Medicare beneficiaries understand their rights and helps resolve concerns that have not been fixed by 1-800-MEDICARE.
- Report the Practice: If a provider insists on an administrative fee as a condition of seeing you, report the incident:
- Contact the OIG Hotline at 1-800-HHS-TIPS.
- Contact the Center for Medicare Advocacy at (860) 456-7790
Are there any State Protections or Resources to Help Me?
While the Medicare Act provides the primary federal protection against these fees, you may also have recourse through state-level resources.
Potential Violations of State Consumer Protection Laws
In addition to federal violations, charging “administrative” or “access” fees for services already covered by insurance may violate state consumer protection statutes, often referred to as Unfair or Deceptive Trade Practices Acts. These state laws generally prohibit businesses – including medical practices – from engaging in misleading billing or charging for services that were not actually provided or are already paid for. Misrepresenting a fee as being for “non-covered services” when those services are actually part of standard Medicare coverage may constitute a deceptive practice under these state laws.
State and Local Resources for Help
If you are faced with an unexpected administrative fee, the following state-specific resources can provide free assistance:
- State Health Insurance Assistance Program (SHIP): SHIPs provide free, unbiased counseling and assistance to Medicare beneficiaries, their families, and caregivers. Visit shiphelp.org to find your local SHIP.
- State Attorney General’s Office (Consumer Protection Division): Most state Attorneys General have a division dedicated to investigating unfair billing practices and medical debt issues.
May 14, 2026 – J. Norris