Approved Charge

Approved Charge

In some health insurance plans, the amount that the insurer will pay for a medical procedure. Some insurers will only pay for medical procedures up to the approved charge. If the amount the physician or hospital bills exceeds the approved charge, the policyholder is responsible for paying it. See also: Coinsurance.

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Approved charge. With traditional fee-for-service health insurance, the insurance company sets an approved or allowable amount for each medical procedure or office visit.

If your bill exceeds the approved charge, the difference between the approved charge and the claim that's submitted to the insurance company for reimbursement is considered an excess charge. You are responsible for that amount in addition to a percentage of the approved charge.

Medicare establishes approved charges for medical procedures and office visits. If you participate in Original Medicare, there's a legal limit on what a doctor, laboratory, or other medical provider can charge in excess of the approved amount.