If a nonparticipating physician charges $125 and the Medicare Fee Schedule is $100, what does "balance billing" mean for the patient?

Balance billing refers to the practice where a nonparticipating physician bills a patient for the difference between what they charge and what Medicare pays. In this scenario, since the nonparticipating physician has charged $125, and the Medicare Fee Schedule allows for $100, the physician can bill the patient for the remaining $25. This amount, which is above the Medicare Fee Schedule, is what the patient is liable for, making "balance billing" applicable here.

Under Medicare rules, nonparticipating providers can choose to "balance bill" patients because they do not accept the Medicare assignment, which means they are not bound by the fee schedule limits in terms of the total amount charged for their services. This practice can lead to additional out-of-pocket costs for patients who receive care from these providers.