Medicare Glossary

Assignment

An agreement by a doctor, supplier, or provider to accept the Medicare-approved amount as full payment for a covered service. Providers who accept assignment cannot bill you for more than that amount, aside from normal deductibles and coinsurance.

Capitation

A payment method where a health plan pays a fixed monthly amount per enrolled member to a provider or group, regardless of how many services that member uses. Common in Medicare Advantage HMO plans.

Limiting Charge

The highest amount a non-participating provider who does not accept assignment is allowed to charge for a Medicare-covered service — capped at 15% above the Medicare-approved amount.

Network

The doctors, hospitals, pharmacies, and other health care providers that have contracted with a health plan to provide services to members at negotiated rates. Medicare Advantage and Medigap SELECT plans have networks; Original Medicare does not.

Also known as: Provider network, In-network

Non-participating Provider

A doctor or supplier who does not accept Medicare assignment but is still enrolled in Medicare. They may charge up to 15% more than the Medicare-approved amount (the limiting charge). Medicare will still pay its share, but you may pay more.

Also known as: Non-par provider

Out-of-Network

Providers, facilities, or suppliers that do not have a contract with your health plan. Using out-of-network providers often costs more. Some Medicare Advantage plans (like PPOs) allow out-of-network use at higher cost; others (like HMOs) generally do not.

PACE (Program of All-Inclusive Care for the Elderly)

A Medicare and Medicaid program that provides comprehensive medical and social services to help certain frail, older adults continue living in their community instead of a nursing home.

Also known as: PACE

Participating Provider

A doctor, hospital, or other health care provider who accepts Medicare assignment — meaning they agree to accept the Medicare-approved amount as full payment for covered services.

Also known as: Par provider

Primary Care Provider (PCP)

The main doctor who manages your overall health care and refers you to specialists when needed. Some Medicare Advantage HMO plans require you to choose a PCP and get referrals from them before seeing a specialist.

Also known as: PCP, Primary care doctor

Referral

A written order from your primary care provider authorizing you to see a specialist or get certain health care services. HMO-type Medicare Advantage plans typically require referrals; PPOs and Original Medicare do not.