The core difference
The annual wellness visit (AWV) and a routine annual physical are two distinct appointments with different content and different coverage. The AWV is a yearly preventive-planning visit organized around a health risk assessment and a personalized prevention plan, and Medicare covers it in full. A routine annual physical is a comprehensive hands-on head-to-toe examination, and Medicare does not cover it. Patients confuse the two constantly, and that confusion is where surprise bills come from.
The three visits side by side
There are actually three appointments people lump together: the annual wellness visit, a routine annual physical, and the one-time Welcome to Medicare visit. They differ on what happens in the room, what Medicare pays, and how often you can get one. The table below lays out each.
| Dimension | Annual wellness visit | Routine annual physical | IPPE (Welcome to Medicare) |
|---|---|---|---|
| What it is | Preventive-planning visit with a health risk assessment and a personalized prevention plan | Comprehensive head-to-toe hands-on examination | One-time introductory preventive review when you first join Medicare |
| Hands-on exam? | No full exam. Only height, weight, BMI, and blood pressure are required | Yes, a full physical examination | No full exam. A limited review of vitals, vision, and risk factors |
| Medicare coverage | Covered in full | Not covered | Covered in full |
| Patient cost | No copay, no deductible | Patient pays out of pocket, or it is billed as a problem visit if complaints are addressed | No copay, no deductible |
| Frequency | Once every 12 months | Set by the patient and practice, not by Medicare | Once, within the first 12 months of Part B |
| Billing codes | G0438 initial, G0439 subsequent | No Medicare preventive code | G0402 |
What the AWV is, and what it is not
The annual wellness visit is a preventive-planning conversation, not an examination. The patient completes a health risk assessment covering health status, behavioral risks, functional ability, and psychosocial factors, and the provider uses it to build or update a personalized prevention plan: a schedule of recommended screenings, a review of current providers and medications, cognitive and depression screening, and a list of risk factors with interventions. Medicare.gov describes the AWV as a yearly visit to develop or update a personalized prevention plan, not a physical exam.
The only physical measurements the AWV requires are height, weight, body mass index, and blood pressure. There is no comprehensive hands-on exam, no listening to the heart and lungs as a matter of course, no head-to-toe workup. A patient who walks in expecting a full physical and gets a planning conversation often feels short-changed, which is why setting the expectation before the visit matters.
Why Medicare does not cover a routine physical
Medicare was not designed to pay for a routine comprehensive physical, and it still does not. Medicare.gov is direct about this: routine yearly physical exams are not a covered benefit. If a patient asks for a full head-to-toe physical with no specific medical complaint, they generally pay for it out of pocket.
There is one common variation. If the visit turns out to address a specific complaint or an active condition, the provider can bill it as a problem-oriented evaluation and management visit, which Medicare does cover, subject to the usual cost sharing. So the same appointment can land in three different places depending on what actually happens: a covered annual wellness visit, a covered problem visit with cost sharing, or a non-covered routine physical the patient pays for. The label on the schedule is not what determines coverage. The content of the visit is.
This gap trips up patients who carried over a habit from commercial insurance, where a yearly physical is often a standard covered benefit. When they age into Medicare and ask for the same thing, the benefit is not there. The annual wellness visit is the closest thing Medicare offers, but it is a different appointment with a different purpose, and treating it as a stand-in for the physical they used to get is the root of most of the confusion.
Where the Welcome to Medicare visit fits
The Initial Preventive Physical Examination (IPPE), known as the Welcome to Medicare visit, is a separate one-time appointment available only within the first 12 months of Part B enrollment. It is billed under code G0402 and is covered in full, with no copay and no deductible.
Like the annual wellness visit, the IPPE is preventive rather than a full physical. It includes a review of medical and social history, a check of vitals and a vision test, depression and functional screening, and education and referrals for preventive services. A patient gets the IPPE once, early on, and then becomes eligible for annual wellness visits in later years. It is not a substitute for the AWV and it does not repeat.
How to avoid surprise bills
The surprise bill problem is almost always an expectation problem, and it is preventable at scheduling. When a patient books what they call their yearly checkup, confirm which visit they actually want and what Medicare will pay for before they arrive.
- Name the visit at booking. Tell the patient whether they are scheduled for an annual wellness visit or a routine physical, and that the routine physical is not a Medicare benefit.
- Separate the preventive and problem parts. If a patient wants to discuss an active complaint during a wellness visit, explain up front that the problem portion may be billed separately with cost sharing.
- Check AWV timing. The annual wellness visit is covered once every 12 months. Booking it a few days early can flip a $0 visit into a denied claim.
- Confirm IPPE eligibility. The Welcome to Medicare visit is only available in the first 12 months of Part B, so verify the window before scheduling it.
The AWV as a risk-adjustment opportunity
Beyond prevention, the annual wellness visit is the single best recurring chance to re-document a patient's chronic conditions for accurate risk adjustment. Because the AWV is annual and structured, it gives the care team a scheduled touchpoint to confirm and capture every active condition that supports an accurate RAF score under the CMS-HCC V28 model. Conditions that are not documented in the year do not count, so a missed AWV is a missed capture opportunity.
The work behind that is heavy. Someone has to identify which patients are due, pull the chronic conditions that need re-documentation, prep the encounter, and follow up on the gaps that the visit did not close. Done by hand across a large panel, it is slow, and it is the work that decides whether a year's recapture lands. A single coordinator working a panel of tens of thousands of members cannot manually review every chart, flag every suspected condition, and chase every open gap inside the AWV window. The volume forces triage, and the conditions that get dropped are the ones that quietly erode the RAF score the contract is paid on.
How Pelica helps
Most platforms show a care team which patients are due for a wellness visit and which conditions need re-documentation. Pelica actually does the work. The Risk Adjustment copilot sits on one live member record, surfaces the chronic conditions a patient's AWV should recapture, preps each encounter, and follows up on open gaps until they close, so the annual visit becomes a reliable recapture event rather than a missed one.
The effect shows up as capacity. Pelica cuts risk-adjustment coordination from about 30 minutes per member to 3, lets the same team cover two to three times more members, and has delivered a 0.4 RAF gain in two quarters with no new headcount. At HealthCare Partners, the largest IPA in the country, the platform runs across 175,000-plus patients live.