Ways to Reduce Surprise Medicare Costs
- Cassidy Clark
- Mar 17
- 4 min read
Unexpected medical bills can be stressful, especially when you believe something should have been covered. While not every cost can be avoided, many surprise expenses can be reduced with a little preparation. Understanding how your plan works is key, and your SGIA Benefit Consultant is here to help you do just that.
Below are practical steps you can take to better protect yourself financially.
Confirm That Your Provider Accepts Your Coverage
Before scheduling an appointment, ask:
Do you accept Medicare?
Do you accept assignment?
Are you in-network with my plan?
With Original Medicare, providers who accept “assignment” agree to accept the Medicare-approved amount as full payment. If a provider does not accept assignment, they may charge more.
Medicare Supplement (Medigap) plans work with Original Medicare, which generally allows you to see any provider that accepts Medicare.
With certain plans such as Medicare Advantage, staying in-network is especially important. Out-of-network care may cost more, or may not be covered at all, depending on your plan type (HMO, PPO, etc.).
A quick phone call before an appointment can prevent unexpected bills later.
Verify Coverage Before Tests or Procedures
Even if your doctor recommends a service, it does not automatically mean Medicare will cover it.
Before non-emergency services such as:
MRIs or CT scans
Outpatient surgeries
Durable medical equipment
Specialist procedures
Ask:
Is this service covered under my plan?
Is prior authorization required?
Will I owe coinsurance or a copay?
Under Original Medicare, most Part B services require you to pay 20% coinsurance after meeting your deductible, and there is no annual out-of-pocket maximum. If you have a Medigap plan, this fills in cost-sharing gaps including coinsurance once you have met the Part B deductible.
Under plans such as Medicare Advantage, prior authorization is often required for certain services. Not getting approval in advance could result in denied claims.
Understand Your Deductibles and Coinsurance
Many surprise bills happen simply because beneficiaries are unaware of how deductibles and coinsurance work.
For example:
Part B deductible (2026): $283 per year
Part A hospital deductible (2026): $1,736 per benefit period
A “benefit period” resets after 60 consecutive days without inpatient care is especially important. You could pay the hospital deductible more than once in a calendar year if multiple benefit periods occur.
Medigap plans cover the costs of Part A deductibles, giving predictable out-of-pocket expenses.
Medicare Advantage plans may have lower monthly premiums, but you might pay coinsurance or copays for certain services, and out-of-pocket costs can add up.
Knowing how your cost-sharing works allows you to plan more realistically.
Review Your Annual Notice of Change (ANOC)
Your Medicare Advantage or Part D plan sends you an Annual Notice of Change (ANOC) every September.
This document outlines:
Premium adjustments
Deductible changes
Copay or coinsurance changes
Pharmacy network updates
Drug formulary changes
Even if you have a Medigap plan, reviewing your Part D plan’s ANOC is important, since prescription coverage is separate. Open Enrollment (Oct 15 – Dec 7) is your opportunity to make adjustments.
Review Your Medicare Summary Notice or Explanation of Benefits
Monitoring your statements helps catch errors early.
Original Medicare (with Medigap if applicable): You receive a Medicare Summary Notice (MSN) every three months.
Medicare Advantage: You receive an Explanation of Benefits (EOB) from your plan.
These statements show:
What services were billed
What Medicare or your plan paid
What you may owe
Reviewing these documents allows you to:
Identify billing mistakes
Catch duplicate charges
Detect potential fraud
Reviewing them allows you to identify billing mistakes, catch duplicate charges, and detect potential fraud.
Compare Prescription Drug Costs Carefully
Prescription drug costs can vary significantly depending on:
The plan’s formulary
The drug’s tier
The pharmacy you use
Whether a generic alternative is available
Medigap plans do not include prescription coverage, so you’ll need a standalone Part D plan, and reviewing your drug costs annually is critical.
Medicare Advantage plans often include drug coverage, but formularies can change each year.
In 2026, Medicare Part D includes a $2,100 annual out-of-pocket cap for covered drugs. Once you reach this amount, you pay $0 for covered medications for the rest of the year.
Ask Questions Before You Receive Care
One of the most effective ways to reduce surprise costs is simply to ask:
What will this cost me?
Is there a less expensive alternative?
Is this service preventive (covered at 100%) or diagnostic (subject to cost-sharing)?
Preventive services under Part B are often covered at no cost when eligibility requirements are met. However, if a preventive visit turns into a diagnostic service, additional costs may apply.
Medigap plans help fill the gaps, so coinsurance, copays, or deductibles don’t surprise you.
Medicare Advantage plans may require network providers or prior authorizations, so asking first avoids unexpected charges.
Understanding the difference helps avoid confusion later.
Final Thoughts
Surprise Medicare costs often happen when coverage details are misunderstood or when plan changes go unnoticed.
The best protection includes:
Staying informed
Reviewing documents carefully
Confirming coverage in advance
Asking questions upfront
Medicare rules and cost-sharing amounts are updated annually. Reviewing your coverage each year ensures your plan continues to meet your healthcare needs and financial goals.
Your Benefit Consultant at SGIA Medicare Consulting can help review your coverage and costs.
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