American Academy of Professional Coders (AAPC) Practice Exam

What is a limiting charge?

1. Limits set on the overall billing amount for services

2. Limits set on what can be charged for each CPT code

3. Limits placed on the number of services billed

4. Limits on the types of procedures performed

The correct answer is: Limits set on what can be charged for each CPT code

A limiting charge is a specific amount that non-participating providers can charge Medicare beneficiaries for covered services. This charge is generally set based on what Medicare pays for that service and is aimed at ensuring that patients do not face exorbitant fees when receiving care from providers outside of the Medicare network. The correct answer correctly identifies that the limits are specifically set on what can be charged for each CPT code. This means that for each procedure or service, Medicare determines a fee schedule, and non-participating providers are allowed to charge up to a certain limit (the limiting charge), which is typically higher than what Medicare would pay but capped to protect beneficiaries from excessive costs. Understanding the context of this charge is crucial for accurate medical billing and coding, as it affects how services are billed to Medicare and what patients will be responsible for out-of-pocket. It ensures that while patients can see any Medicare-approved provider, there is a safeguard against unusually high charges from those who do not participate in the Medicare program.