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Improving your hospital revenue cycle, what does accept assignment mean.

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What does it mean to accept assignment on the CMS 1500 claim form – also called the HCFA 1500 claim form.? Should I accept assignment or not? What are the guidelines for accepting assignment in box 27 of the 1500 claim?

These commonly asked questions should have a simple answer, but the number of court cases indicates that it is not as clear cut as it should be. This issue is documented in the book “Problems in Health Care Law” by Robert Desle Miller. The definition appears to be in the hands of the courts. However, we do have some helpful guidelines for you.

One major area of confusion is the relationship between box 12, box 13 and box 27.  These are not interchangeable boxes and they are not necessarily related to each other.

According to the National Uniform Claim Committee (NUCC), the “Accept Assignment” box indicates that the provider agrees to accept assignment.  It simply says to enter an X in the correct box.  It does NOT define what accepting assignment might or might not mean.

It is important to understand that if you are a participating provider in any insurance plan or program, you must first follow the rules according to the contract that you sign. That contract superceeds any guidelines that are included here.

Medicare Instructions / Guidelines

PARTICIPATING providers MUST accept assignment according to the terms of their contract.  The contract itself states:

“Meaning of Assignment – For purposes of this agreement, accepting assignment of the Medicare Part B payment means requesting direct Part B payment from the Medicare program.  Under an assignment , the approved charge, determined by the Medicare carrier, shall be the full charge for the service covered under Part B.  The participant shall not collect from the beneficiary or other person or organization for covered services more than the applicable deductible and coinsurance.”

By law, the providers or types of services listed below MUST also accept assignment:

• Clinical diagnostic laboratory services;
• Physician services to individuals dually entitled to Medicare and Medicaid;
• Services of physician assistants, nurse practitioners, clinical nurse specialists, nurse midwives, certified registered nurse anesthetists, clinical psychologists, and clinical social workers;
• Ambulatory surgical center services for covered ASC procedures;
• Home dialysis supplies and equipment paid under Method II;
• Ambulance services;
• Drugs and biologicals; and
• Simplified Billing Roster for influenza virus vaccine and pneumococcal vaccine.

NON-PARTICIPATING providers can choose whether to accept assignment or not, unless they or the service they are providing is on the list above.

The official Medicare instructions regarding Boxes 12 and 13 are:

“Item 12 – The patient’s signature authorizes release of medical information necessary to process the claim. It also authorizes payments of benefits to the provider of service or supplier when the provider of service or supplier accepts assignment on the claim.” “Item 13 – The patient’s signature or the statement “signature on file” in this item authorizes payment of medical benefits to the physician or supplier. The patient or his/her authorized representative signs this item or the signature must be on file separately with the provider as an authorization. However, note that when payment under the Act can only be made on an assignment-related basis or when payment is for services furnished by a participating physician or supplier, a patient’s signature or a “signature on file” is not required in order for Medicare payment to be made directly to the physician or supplier.”

Regardless of the wording on these instructions stating that it authorizes payments to the physician, this is not enough to ensure that payment will come directly to you instead of the patient.To guarantee payment comes to you, you MUST accept assignment.

Under Medicare rules, PARTICIPATING providers are paid at 80% of the physician fee schedule allowed amount and NON-participating providers are paid at 80% of the allowed amount, which is 5% less than the full Allowed amount for participating providers. Only NON-participating providers may “balance bill” the patient for any amounts not paid by Medicare, however, they are subject to any state laws regarding balance billing.

NON-MEDICARE Instructions / Guidelines

PARTICIPATING providers MUST abide by the terms of their contract.  In most cases, this includes the requirement to accept assignment on submitted claims.

NON-PARTICIPATING providers have the choice to accept or not accept assignment.

YES means that payment should go directly to you instead of the patient.  Generally speaking, even if you have an assignment of benefits from the patient (see box 12 & 13), payment is ONLY guaranteed to go to you IF you accept assignment.

NO is appropriate for patients who have paid for their services in full so they may be reimbursed by their insurance.  It generally means payment will go to the patient.

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As a Medical Biller, the better you understand the medical insurance payment process, the better you can care for your patients. Your understanding of what a patient will owe and what will be covered can help them navigate the confusing world of medical insurance.

One term that can be very confusing for patients (and for doctors as well) is ‘Accepting Assignment’.

Essentially, ‘assignment’ means that a doctor, (also known as provider or supplier) agrees (or is required by law) to accept a Medicare-approved amount as full payment for covered services.

This amount may be lower or higher than an individual’s insurance amount, but will be on par with Medicare fees for the services.

If a doctor participates with an insurance carrier, they have a contract and agree that the provider will accept the allowed amount, then the provider would check “yes”.  

If they do not participate and do not wish to accept what the insurance carrier allows, they would check “no”.   It is important to note that a provider who does not participate can still opt to accept assignment on just a particular claim by checking the “yes” box just for those services.

In other words by saying your office will accept assignment, you are agreeing to the payment amount being covered by the insurer, or medicare, and the patient has no responsibility.

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Does your provider accept Medicare as full payment?

You can get the lowest cost if your doctor or other health care provider accepts the Medicare-approved amount  as full payment for a covered service. This is called “accepting assignment.” If a provider accepts assignment, it’s for all Medicare-covered Part A and Part B services.

Using a provider that accepts assignment

Most doctors, providers, and suppliers accept assignment, but always check to make sure that yours do.

If your doctor, provider, or supplier accepts assignment:

• Your out-of-pocket costs may be less.
• They agree to charge you only the Medicare deductible and coinsurance amount, and usually wait for Medicare to pay its share before asking you to pay your share.
• They have to submit your claim directly to Medicare and can't charge you for submitting the claim.

How does assignment impact my drug coverage?

Using a provider that doesn't accept Medicare as full payment

Some providers who don’t accept assignment still choose to accept the Medicare-approved amount for services on a case-by-case basis. These providers are called "non-participating."

If your doctor, provider, or supplier doesn't accept assignment:

• You might have to pay the full amount at the time of service.
• They should submit a claim to Medicare for any Medicare-covered services they give you, and they can’t charge you for submitting a claim. If they refuse to submit a Medicare claim, you can submit your own claim to Medicare. Get the Medicare claim form .
• They can charge up to 15% over the Medicare-approved amount for a service, but no more than that. This is called "the limiting charge."  

Does the limiting charge apply to all Medicare-covered services?

Using a provider that "opts-out" of Medicare

• Doctors and other providers who don’t want to work with the Medicare program may "opt out" of Medicare.
• Medicare won’t pay for items or services you get from provider that opts out, except in emergencies.
• Providers opt out for a minimum of 2 years. Every 2 years, the provider can choose to keep their opt-out status, accept Medicare-approved amounts on a case-by-case basis ("non-participating"), or accept assignment.

Find providers that opted out of Medicare.

Private contracts with doctors or providers who opt out

• If you choose to get services from an opt-out doctor or provider you may need to pay upfront, or set up a payment plan with the provider through a private contract.
• Medicare won’t pay for any service you get from this doctor, even if it’s a Medicare-covered service.

What are the rules for private contracts?

You may want to contact your  State Health Insurance Assistance Program (SHIP) for help before signing a private contract with any doctor or other health care provider.

What do you want to do next?

• Next step: Get help with costs
• Take action: Find a provider
• Get details: How to get Medicare services

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Find-A-Code Articles, Published 2014, August 1

What does accept assignment mean.

by   InstaCode Institute Aug 1st, 2014 - Reviewed/Updated Mar 5th

What does it mean to accept assignment on the CMS 1500 claim form - also called the HCFA 1500 claim form.? Should I accept assignment or not? What are the guidelines for accepting assignment in box 27 of the 1500 claim?

These commonly asked questions should have a simple answer, but the number of court cases indicates that it is not as clear cut as it should be. This issue is documented in the book “Problems in Health Care Law” by Robert Desle Miller. The definition appears to be in the hands of the courts. However, we do have some helpful guidelines for you.

One major area of confusion is the relationship between box 12, box 13 and box 27.  These are not interchangeable boxes and they are not necessarily related to each other.

According to the National Uniform Claim Committee (NUCC), the "Accept Assignment" box indicates that the provider agrees to accept assignment.  It simply says to enter an X in the correct box.  It does NOT define what accepting assignment might or might not mean.

It is important to understand that if you are a participating provider in any insurance plan or program, you must first follow the rules according to the contract that you sign. That contract supersedes any guidelines that are included here.

Medicare Instructions / Guidelines

PARTICIPATING providers MUST accept assignment according to the terms of their contract.  The contract itself states:

“Meaning of  Assignment  - For purposes of this agreement, accepting  assignment  of the Medicare Part B payment means requesting direct Part B payment from the Medicare program.  Under an  assignment , the approved charge, determined by the Medicare carrier, shall be the full charge for the service covered under Part B.  The participant shall not collect from the beneficiary or other person or organization for covered services more than the applicable deductible and coinsurance.”

By law, the providers or types of services listed below MUST also accept assignment:

• Clinical diagnostic laboratory services;
• Physician services to individuals dually entitled to Medicare and Medicaid;
• Services of physician assistants, nurse practitioners, clinical nurse specialists, nurse midwives, certified registered nurse anesthetists, clinical psychologists, and clinical social workers;
• Ambulatory surgical center services for covered ASC procedures;
• Home dialysis supplies and equipment paid under Method II;
• Ambulance services;
• Drugs and biologicals; and
• Simplified Billing Roster for influenza virus vaccine and pneumococcal vaccine.

NON-PARTICIPATING providers can choose whether to accept assignment or not, unless they or the service they are providing is on the list above.

The official Medicare instructions regarding Boxes 12 and 13 are:

“Item 12 – The patient's signature authorizes release of medical information necessary to process the claim. It  also authorizes payments of benefits  to the provider of service or supplier when the provider of service or supplier accepts assignment on the claim.” “Item 13 - The patient’s signature or the statement “signature on file” in this item  authorizes payment of medical benefits  to the physician or supplier. The patient or his/her authorized representative signs this item or the signature must be on file separately with the provider as an authorization. However, note that when payment under the Act can only be made on an assignment-related basis or when payment is for services furnished by a participating physician or supplier, a patient’s signature or a “signature on file” is not required in order for Medicare payment to be made directly to the physician or supplier.”

Regardless of the wording on these instructions stating that it authorizes payments to the physician, this is not enough to ensure that payment will come directly to you instead of the patient.To guarantee payment comes to you, you MUST accept assignment.

Under Medicare rules, PARTICIPATING providers are paid at 80% of the  physician fee schedule allowed amount  and NON-participating providers are paid at 80% of the allowed amount, which is 5% less than the full Allowed amount for participating providers. Only NON-participating providers may "balance bill" the patient for any amounts not paid by Medicare, however, they are subject to any state laws regarding balance billing.

TIP: If you select YES, you may or may not be subject to a lower fee schedule, but at least you know the payment is  supposed  to come to you.

NON-MEDICARE Instructions / Guidelines

PARTICIPATING providers MUST abide by the terms of their contract.  In most cases, this includes the requirement to accept assignment on submitted claims.

NON-PARTICIPATING providers have the choice to accept or not accept assignment.

YES means that payment should go directly to you instead of the patient.  Generally speaking, even if you have an assignment of benefits from the patient (see box 12 & 13), payment is ONLY guaranteed to go to you IF you accept assignment.

NO is appropriate for patients who have paid for their services in full so they may be reimbursed by their insurance.  It generally means payment will go to the patient.

What Does Accept Assignment Mean?. (2014, August 1). Find-A-Code Articles. Retrieved from https://www.findacode.com/articles/what-does-accept-assignment-mean-34840.html

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What is Medicare assignment and how does it work?

En español  | Whether or not your doctors “accept assignment” determines how much you pay for their services.

Medicare decides how much to pay providers for covered services. Most doctors accept the Medicare-approved amount for services Medicare covers, even if it’s less than they usually charge. If the doctor agrees to the approved amount, he or she is accepting assignment.

A doctor who accepts assignment agrees to charge you no more than the amount Medicare has approved for that service. A doctor who participates in Medicare but doesn’t accept assignment can potentially charge you up to 15 percent more than the Medicare-approved amount.

When choosing new doctors, ask if they accept assignment before you receive care, even if they accept Medicare patients. If a doctor doesn’t accept assignment, you will pay more for that physician’s services compared with one who does.

How much do I pay if my doctor accepts assignment?

Because Medicare Part B covers doctor and outpatient services, your $226  deductible for Part B in 2023 applies before most coverage begins. If your doctor accepts assignment, then you generally pay 20 percent of the Medicare-approved amount for the service, called coinsurance, after you’ve paid the annual deductible.

All providers who accept assignment must submit claims directly to Medicare, which pays 80 percent of the approved cost for the service and will bill you the remaining 20 percent. You can get some preventive services and screenings, such as mammograms and colonoscopies, without paying a deductible or coinsurance if the provider accepts assignment. 

What if my doctor doesn’t accept assignment?

A doctor who takes Medicare but doesn’t accept assignment can still treat Medicare patients but won’t always accept the Medicare-approved amount as payment in full. This means he or she can charge you up to a maximum of 15 percent more than Medicare pays for the service you receive. In this case, you’re responsible for the additional charge, plus the regular 20 percent coinsurance, as your share of the cost.

How to cover the extra cost? If you have a Medicare supplement policy , better known as Medigap, it may cover the extra 15 percent, called Medicare Part B excess charges.

All Medigap policies cover Part B’s 20 percent coinsurance in full or in part. The F and G policies cover the 15 percent excess charges from doctors who don’t accept assignment.

If you’re new to Medicare, you can’t buy Medicare supplement Plan F as of 2020. But if you turned 65 by the end of 2019, you may be able to even if you haven’t enrolled yet.

Everyone enrolled in original Medicare can apply for Plan G. Keep in mind that Medigap policies only cover excess charges for doctors who accept Medicare but don’t accept assignment and they won’t cover costs for doctors who opt out of Medicare entirely.

How do I find doctors who accept assignment?

Before you start working with a new doctor, ask whether he or she accepts assignment. About 97 percent of providers billing Medicare are participating providers, which means they accept assignment on all Medicare claims, according to the Kaiser Family Foundation.

You can get help finding doctors and other providers in your area who accept assignment by using Medicare’s Physician Compare tool . You can look up doctors and other clinicians near your zip code.

Those who accept assignment have this note under the name: “Charges the Medicare-approved amount (so you pay less out of pocket).” However, not all doctors who accept assignment are accepting new Medicare patients.

What does it mean if a doctor opts out of Medicare?

Doctors who opt out of Medicare can’t bill Medicare for services you receive. They also aren’t bound by Medicare’s limitations on charges.

In this case, you enter into a private contract with the provider and agree to pay the full bill. Be aware that neither Medicare nor your Medigap plan will reimburse you for these charges.

While most doctors participate in Medicare, others, such as some psychiatrists, opt out. A Kaiser Family Foundation study found that only 1 percent of physicians who weren’t pediatricians formally opted out of Medicare in 2022, but 7.5 percent of psychiatrists had opted out.

Differences in what you pay for doctors’ services

The three ways that physicians deal with Medicare can drastically affect what you spend on care.

Note: Doctors who don’t accept assignment receive a Medicare-approved amount that is 5 percent less than those who accept assignment.

Source: Medicare, California Health Advocates, AARP research

Keep in mind

These rules apply to original Medicare. Other factors determine costs if you choose to get coverage through a private  Medicare Advantage plan . Most Medicare Advantage plans have provider networks, and they may charge more or not cover services from out-of-network providers.

Before choosing a Medicare Advantage plan, find out whether your chosen doctor or provider is covered and identify how much you’ll pay. You can use the  Medicare Plan Finder  to compare the Medicare Advantage plans and their out-of-pocket costs in your area.

Updated July 14, 2023

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