Opinion ID: 835127
Heading Depth: 2
Heading Rank: 1

Heading: Medicare Caps the Medical Costs Incurred.

Text: Plaintiff received medical services from eight providers. Seven provided physician services, which are covered under Medicare Part B. One provided inpatient hospital services, which are covered under Medicare Part A. Medicare Part A and Medicare Part B are subject to different statutory provisions, and this opinion begins by discussing the limitations that Medicare Part B places on the amount that physicians can charge Medicare beneficiaries. Medicare Part B sets a reasonable charge (or Medicare approved charge) for medical services that a physician provides. As initially enacted, Medicare Part B did not limit the amount that a physician could charge a Medicare beneficiary unless the physician accepted assignment of the beneficiary's Medicare claim. See 1 Medicare and Medicaid Guide (C.C.H.) ¶ 3186, 1184 (Nov. 20, 2007) (explaining the history of Part B). Rather, Medicare paid 80 percent of the Medicare approved charge, leaving the beneficiary responsible for the remainder of the physician's customary charge. Id. Beginning in 1987, however, Medicare Part B capped the amount that physicians can charge Medicare beneficiaries. Id. Since 1991, that cap has taken the form of a limiting charge, which is a percentage of the Medicare approved charge. 42 U.S.C. § 1395w-4(g)(2)(C). Under Part B, [n]o person is liable for payment of any amounts billed for the service in excess of [the] limiting charge. 42 U.S.C. § 1395w-4(g)(1)(A)(ii). The limiting charge establishes both the maximum that a physician can charge a Medicare beneficiary and the maximum for which a Medicare beneficiary will be liable. Physicians who do not accept assignment of Medicare claims can charge Medicare beneficiaries an amount up to the limiting charge. 42 U.S.C. § 1395w-4(g)(2)(C). Those physicians, however, may not bill or collect an actual charge in excess of the limiting charge. 42 U.S.C. § 1395w-4(g)(1)(A)(i). And, as noted, [n]o person is liable for payment of any amounts billed for the service in excess of [the] limiting charge. 42 U.S.C. § 1395w-4(g)(1)(A)(ii). If a physician has not accepted assignment, a Medicare beneficiary is responsible for paying the physician's bill up to the amount of the limiting charge, and Medicare will reimburse the beneficiary for 80 percent of the limiting charge. Under Medicare Part B, a patient is not liable for the physician's customary charge to the extent it exceeds the Medicare limiting charge. [1] Medicare Part A covers inpatient services in hospitals and similar facilities. Under Part A, a Medicare beneficiary is liable for a lesser amount of the cost than under Part B. Specifically, 42 U.S.C. § 1395cc(a)(1)(A)(i) provides that a hospital cannot receive payments under Medicare Part A unless it agrees not to charge, except as provided in paragraph (2), any individual or any other person for items or services for which such individual is entitled. Paragraph 2 of subsection 1395cc(a) lists the exceptions to that limitation on liability, which include: (1) payment of a deductible for each stay in the hospital ($1,068 in 2009); (2) daily coinsurance payments if the stay exceeds 60 days (either the hospital's customary rate or a percentage of the deductible, whichever is lower); and (3) the additional cost of noncovered services, such as a private room, that the patient expressly requests. 42 U.S.C. § 1395cc(a)(2); see 3 Medicare and Medicaid Guide (CCH) ¶ 13,010, 5307-08 (Dec. 2, 2008) (describing costs for which beneficiaries will be liable under Medicare Part A). Medicare Part A differs from Medicare Part B in that Part A permits a hospital to charge a Medicare beneficiary only for the cost of the deductible and other charges. A beneficiary is not liable, under Part A, for the cost of inpatient hospital services up to the amount of Medicare capthe amount that Medicare reimburses the hospital. [2] However, both Part A and Part B are identical in that neither part permits a hospital or a physician to charge more than the Medicare capped amount. Under both Part A and Part B, no one incurs or is liable for a hospital or a physician's customary charges to the extent that those charges exceed the Medicare cap. Plaintiff argues, however, that he agreed to pay and was liable for the full amount of his providers' customary charge. [3] The record does not support that assertion. As noted, plaintiff received medical services from eight providers. The agreements with two of those providers are in the record. One agreement, with Open Advanced MRI & CT, reminds patients that whether you have health insurance coverage or not, professional services are rendered to and charged to the patient. It then adds, You (or the responsible party in the case of a minor) are responsible for payment of your bill even if not covered in full or in part by your insurance. [4] The part of the agreement on which plaintiff relies states only that plaintiff remains responsible for payment of his bill, even if he has insurance. The agreement says nothing about the rate that plaintiff agreed to pay or whether plaintiff is responsible for any amounts over and above what Medicare permits. The agreement is silent on that point. Medicare Part B prevents entities providing physician services, such as Open Advanced MRI, from billing a patient more than the limiting charge. [5] As noted, nonparticipating physicians may not bill a Medicare beneficiary for more than the limiting charge, and [n]o [beneficiary] is liable for payment of any amounts billed for the service in excess of [the] limiting charge. 42 U.S.C. § 1395w-4(g)(1)(A)(ii). It is hardly surprising that Open Advanced MRI's agreement does not impose an obligation on its patients that would be contrary to federal law. Its agreement does not support plaintiff's position. Plaintiff's agreement with Southwest Washington Medical Center presents a closer question but still does not support plaintiff's position. Paragraph 10 of that agreement states: I, the undersigned, agree    that in consideration of the services to be provided that the undersigned hereby obligates himself/herself    to pay the account of SWMC in accordance with its regular rates and terms. I further agree to pay for services denied or not covered by my insurance regardless of the reason for denial or non-coverage. I agree to pay for services not covered by my Medicaid program even if I did not disclose my Medicaid eligibility at registration or obtain eligibility on a retroactive basis. Plaintiff presumably interprets the agreement obligating him to pay the account of SWMC in accordance with its regular rates and terms as an agreement to accept liability for the hospital's customary charges. While textually permissible, that interpretation conflicts with Medicare Part A, which requires hospitals to agree not to charge Medicare beneficiaries for their services except as expressly authorized. [6] It is also equally permissible to read the agreement consistently with federal law; that is, the agreement to pay    SWMC in accordance with its regular rates and terms refers to those rates and terms that Medicare Part A permits. One should hesitate to assume that the nonspecific phrase regular rates and terms refers to rates and terms that are contrary to federal law. The third sentence in paragraph 10 supports that reading. It provides that the patient agree[s] to pay for services not covered by my Medicaid program. If the first sentence were as broad as plaintiff perceives, the third sentence in paragraph 10 would be unnecessary. That is, if the first sentence in paragraph 10 required a Medicaid beneficiary to assume responsibility for all the hospital's customary charges, there would be no need to specify in the third sentence that a Medicaid beneficiary agrees to pay for those services that Medicaid does not cover. In any event, if the agreement with Southwest Washington Medical Center purported to impose liability on plaintiff for all the hospital's customary charges, it would be inconsistent with Medicare Part A, and federal law would negate any contrary obligation that that agreement sought to impose. Plaintiff did not introduce any other agreements that he may have had with his other six medical providers, all of whom were physicians. The burden of production was on plaintiff to prove the extent of his damages, and the absence of those agreements cuts against him. Beyond that, as explained above, Medicare Part B prevents a physician from charging more than the limiting charge. There is no reason to assume that plaintiff's doctors entered into agreements contrary to federal law, and, even if they did, federal law would supersede those agreements. As a matter of federal law, neither plaintiff nor Medicare incurred liability for any medical charges in excess of the Medicare cap.