Medicaid/Medicare Opt-Out Frequently Asked Questions

Yes, ONLY IF the “opt out” physician or practitioner ordering the service has acquired a Unique Provider Identification Number (UPIN) / National Provider Identifier (NPI) and the services are not furnished by a physician or practitioner who has also opted out.

No. Since Medicare rules do not apply for services not covered by Medicare, a private contract is not needed. A private contract is needed only for services that are covered by Medicare and where Medicare might make payment if a claim were submitted.

No. The opt out applies to all items or services the physician or practitioner furnishes to Medicare beneficiaries, regardless of the location where such items or services are furnished.

No. Corporations, partnerships, or other organizations that bill and are paid by Medicare for the services of physicians or practitioners who are employees, partners or have other arrangements that meet the Medicare reassignment-of-payment rules cannot opt out since they are neither physicians nor practitioners. Of course, if every physician and practitioner within a corporation, partnership or other organization opted out, then such corporation, partnership, or other organization would have in effect, opted out.

Where a physician or practitioner opts out and is a member of a group practice or otherwise reassigns his or her rights to Medicare payment to an organization, the organization may no longer bill Medicare or be paid by Medicare for the services that physician or practitioner furnishes to Medicare beneficiaries. However, if the physician or practitioner continues to grant the organization with the right to bill and be paid for the services he or she furnishes to patients, the organization may bill and be paid by the beneficiary for the services that are provided under the private contract.

The decision of a physician or practitioner to opt out of Medicare does not affect the ability of the group practice or organization to bill Medicare for t he services of physicians and practitioners who have not opted out of Medicare

No. If a physician or practitioner chooses to opt out of Medicare, it means that he or she opts out for all covered items and services he or she furnishes. Physicians and practitioners cannot have private contracts that apply to some covered services they furnish but not to others. In addition, because suppliers of DMEPOS, independent diagnostic testing facilities, clinical laboratories, etc., cannot opt out, the physician or practitioner owner of such suppliers cannot opt out as such a supplier

Certain physicians and practitioners can “opt out” of Medicare. For purposes of this provision, physicians include doctors of medicine, osteopathy, optometry, podiatric medicine and doctors of dental surgery. Practitioners permitted to opt out are physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists, certified nurse midwives, clinical social workers, and clinical psychologists.

As provided in § 4507 of the Balanced Budget Act of 1997, a “private contract” is a contract between a Medicare beneficiary and a physician or other practitioner who has “opted out” of Medicare for two years for all covered items and services he or she furnishes to Medicare beneficiaries. In a private contract, the Medicare beneficiary agrees to give up Medicare payment for services furnished by the physician or practitioner and to pay the physician or practitioner without regard to any limits that would otherwise apply to what the physician or practitioner could charge.

When Medicare is the secondary payer, and the physician has opted out of Medicare, the physician has agreed to treat Medicare beneficiaries only through private contract. The physician or practitioner must therefore have a private contract with the Medicare beneficiary, notwithstanding that Medicare is the secondary payer. Under this circumstance, no Medicare secondary payments will be made for items and services furnished by the physician or practitioner under the private contract.

Check with the individual’s plan. An opt-out physician/practitioner cannot file claims.

“Opt out” physicians should not be listed on the “on call” list for Medicare patients since they are not billing the Medicare program. In rare circumstances, if the “opt out’ physician or practitioner provided emergency care in the hospital emergency room and the critical situation continued after admission to the Intensive Care Unit (ICU) or Critical Care Unit (CCU), she/he could continue to care for the patient until it was no longer urgent.

If a provider “opts-out” of Medicare, he is permitted to contract privately with Medicare patients or beneficiaries to provide covered services. The beneficiary agrees to pay fully out-of-pocket for a Medicare-covered service after signing a private contract between themselves and the provider/practitioner. They then agree not to submit a claim to Medicare during the prescribed two-year opt-out period, although the service would be covered if a claim were submitted. Potential Fraud/False Claim.

Mandatory Claim Submission laws require a provider/practitioner to apply for a Provider Identification Number and file claims on their Medicare patient’s behalf, if they provide services that are eligible for Medicare reimbursement and provide these services to Medicare beneficiaries. If the provider does not perform services for any Medicare patients, enrollment in Medicare is not required.

To opt out of Medicare:

• Participating providers are only allowed to opt out at the beginning of each calendar quarter. A valid affidavit postmarked 30 days prior to the first day of each new quarter (January, April, July, or October) must be submitted.
• Non-participating physicians and practitioners have the ability to opt out at any time. However, the Opt Out effective date must be after the date the provider signs the affidavit.
• The Opt-Out contract lasts for a two-year period beginning the date the physician or practitioner files and signs an affidavit that he or she has opted out of Medicare. Then the physician or practitioner could decide to return to Medicare or to “opt out” again.
• A private contract must be entered with each Medicare beneficiary effective when the opt-out period begins.