A par provider has a contract with the insurance company. A non-par provider does not. That one difference changes who gets paid, how much, and what the patient can be billed.
“Par” is short for participating. A participating provider has signed an agreement with a payer and accepts the payer’s allowed amount as payment in full. The patient pays only their copay, coinsurance and deductible. A non-participating (non-par) provider has no agreement, so the payer may pay less or nothing, and the provider may be able to bill the patient the difference, which is called balance billing. Medicare uses the same terms but adds its own rules, including a cap on what non-par providers can charge.
Do not assume a non-par provider can bill the patient any amount. Medicare caps non-par charges, Medicaid generally bans balance billing for covered services, and the federal No Surprises Act bans it in many emergency and in-network facility situations.
This guide explains the difference for commercial plans and for Medicare, shows the math with an example, and covers what practices should weigh when deciding whether to join a network.
Key Takeaways
- Par means the provider has a contract with the payer and accepts its allowed amount. Non-par means no contract.
- Par providers cannot balance bill for covered services. They collect only the patient’s cost share.
- In Medicare, non-par providers are paid 95% of the fee schedule amount and may accept assignment claim by claim.
- On unassigned Medicare claims, non-par providers can charge no more than the limiting charge: 115% of the non-par amount.
- The No Surprises Act protects patients from surprise balance bills for most emergency care and some care at in-network facilities.
- Joining a network trades a lower rate for more patients, direct payment and less collection work.
What Does Par Mean in Medical Billing?
A par, or participating, provider has a signed agreement with a health plan. In commercial insurance, this is usually called being in network. The agreement sets the rates the plan pays and the rules both sides follow.
- The payer pays the provider directly
- The provider accepts the allowed amount as payment in full
- The provider writes off the difference between the charge and the allowed amount as a contractual adjustment
- The provider files claims on the patient’s behalf
- The patient pays only the copay, coinsurance and deductible
What Does Non-Par Mean in Medical Billing?
A non-par, or non-participating, provider has no agreement with the patient’s plan. In commercial insurance, this is called out of network. The plan may pay a lower amount, pay the patient instead of the provider, or pay nothing, depending on the plan’s out-of-network benefits.
Because there is no contract, a non-par provider may be able to bill the patient for the difference between the charge and what the plan pays, unless a law or program rule says otherwise.
Par vs Non-Par: Side-by-Side Comparison
| Feature | Par provider | Non-par provider |
|---|---|---|
| Contract with payer | Yes | No |
| Accepts allowed amount | Yes, as payment in full | Not required, except where law or program rules apply |
| Balance billing | Not allowed for covered services | May be allowed, within legal limits |
| Who receives payment | Provider, directly | Often the patient, who then pays the provider |
| Patient’s cost | Copay, coinsurance and deductible only | Higher; out-of-network cost share plus any balance bill |
| Claim filing | Provider files | Varies; Medicare requires the provider to file |
| Patient volume | Listed in the plan’s directory | Not listed; fewer referrals from the plan |
Par vs Non-Par in Medicare
Medicare has three options for physicians and other practitioners: participating, non-participating, and opting out of Medicare completely.
| Status | Payment | What the patient can be charged |
|---|---|---|
| Participating | 100% of the Medicare fee schedule amount; Medicare pays the provider directly | Deductible and 20% coinsurance only |
| Non-participating, assigned claim | 95% of the fee schedule amount; Medicare pays the provider | Deductible and 20% coinsurance of the reduced amount |
| Non-participating, unassigned claim | Medicare pays the patient 80% of the reduced amount | Up to the limiting charge, 115% of the non-par amount |
| Opted out | Medicare pays nothing | The amount in a private contract signed with the patient |
A worked example
Say the Medicare fee schedule amount for a service is $100 and the patient has met the deductible.
| Scenario | Allowed amount | Medicare pays | Patient pays |
|---|---|---|---|
| Par provider | $100.00 | $80.00 to the provider | $20.00 |
| Non-par, assigned | $95.00 | $76.00 to the provider | $19.00 |
| Non-par, unassigned | Up to $109.25 limiting charge | $76.00 to the patient | Up to $33.25 after Medicare’s payment |
The limiting charge works out to 109.25% of the par amount. That is 115% of the 95% non-par amount. Charges above it are not allowed on unassigned Medicare claims.
Medicare participation is chosen once a year. Providers sign or end a Medicare participation agreement (form CMS-460) during an annual enrollment period near the end of the year, and the choice takes effect on January 1. New enrollees choose when they enroll. Some services and provider types must always accept assignment, so check before setting up as non-par.
Limits on Balance Billing
Being non-par does not mean a provider can bill patients freely. Several rules limit it:
- Medicare: non-par charges on unassigned claims are capped at the limiting charge
- Medicaid: providers generally cannot balance bill Medicaid patients for covered services
- No Surprises Act: since 2022, patients are protected from surprise balance bills for most emergency care, for certain non-emergency care from out-of-network providers at in-network facilities, and for air ambulance services. See CMS’s No Surprises Act resources
- State laws: many states add their own balance billing protections
- Your contracts: a par agreement bans balance billing for covered services
For what practices may and may not collect after a claim is final, see our guide to patient balance billing rules.
Should Your Practice Be Par or Non-Par?
Most practices join major networks, but the right answer depends on your specialty, location and patient mix.
- Look at your payer mix. If a plan covers a large share of patients in your area, going non-par can cost you referrals.
- Compare the rates. Check the plan’s fee schedule against your costs and against what you could collect out of network.
- Count the collection cost. Non-par often means collecting more from patients, which takes staff time and carries bad-debt risk.
- Check the rules. The No Surprises Act and state laws may limit balance billing for many of the services you provide.
- Plan the timeline. Joining a network means credentialing and contracting, which can take months. Start well before you need it.
Common Par and Non-Par Billing Mistakes
Balance billing while par. Billing a patient for the contractual adjustment breaks the contract. Write it off. A CO-45 adjustment on the remittance shows this amount.
Charging over the Medicare limiting charge. On unassigned claims, charges above 115% of the non-par amount are not allowed and must be refunded.
Not checking network status before the visit. Verify the patient’s plan and your status for that plan, location and provider before the appointment.
Billing as in network before the effective date. A pending application is not a contract. Wait for the written effective date.
How Steady Medical Billing Helps
Network status affects every claim a practice sends. Steady Medical Billing’s credentialing and provider enrollment services help practices join commercial networks and enroll with Medicare. Our payer contract management services review rates so you can decide which networks make sense.
Deciding whether to join a network, or waiting on an application? Talk to Steady Medical Billing’s credentialing team.
Frequently Asked Questions
How is a provider reimbursed if there is no agreement with the insurance company?
The provider is paid as out-of-network (non-participating). A commercial plan pays its own out-of-network allowed amount under the patient’s out-of-network benefits, if the plan has any, and HMO-type plans often pay nothing except for emergencies. The patient may owe the difference unless balance billing is restricted, as it is under the No Surprises Act for emergency care and certain services at in-network facilities. In Medicare, a non-participating provider who accepts assignment is paid 95% of the fee schedule amount; one who does not accept assignment can collect up to the limiting charge (115% of that amount) from the patient.
What does PAR stand for in medical terms?
In medical billing and insurance, PAR stands for participating provider: a provider with a signed contract with a health plan. A non-PAR provider has no contract with that plan.
What does par mean in insurance?
Par means participating. A par provider has a contract with the insurance company, accepts its allowed amount as payment in full, and bills the patient only for their copay, coinsurance and deductible.
What is a non-par provider?
A non-par, or non-participating, provider has no contract with the patient’s insurance plan. The plan may pay less or nothing, and the provider may be able to bill the patient the difference, within legal limits.
Is par the same as in network?
In most cases, yes. Par and in network both mean the provider has a contract with the plan. Non-par and out of network both mean there is no contract.
What is the Medicare limiting charge?
The limiting charge is the most a non-participating provider can charge a Medicare patient on an unassigned claim. It is 115% of the non-par fee schedule amount, which works out to 109.25% of the par amount.
Can a non-par provider accept Medicare assignment?
Yes. Non-par providers can choose to accept assignment claim by claim. On an assigned claim, Medicare pays the provider directly, and the provider cannot charge more than the Medicare-approved amount.
Can a par provider bill the patient for the difference?
No. For covered services, a par provider must accept the allowed amount and write off the difference. The patient owes only their copay, coinsurance and deductible.
