Based on the present state of events Providers are looking into options as they regard patients with Medicare coverage. This topic itself although simple can have severe consequences to the healthcare professional if the right steps are not followed. The basic concept is whether a provider can engage contractually with a patient that has Medicare benefits without violating any rules. Common sense dictates that two legal entities are allowed to enter into a contractual arrangement as long as some basic guidelines are followed: 1. Both parties benefit from this arrangement. For example, you cannot create a valid agreement for services unless the other party is paid for this in some way or fashion. 2. The arrangement is legal (doesn’t violate any laws). 3. Both parties are capable entities authorized to make decisions in behalf of themselves or whoever they represent. 4. Normally there is a verbal or written arrangement stipulating the rules of the arrangement. However in the case of Medicare this is not necessarily true. Under §§1848(g)(1) and/or 1848(g)(3) of the Social Security Act. “The Social Security Act (Section 1848(g)(4)) requires that claims be submitted for all Medicare patients for services rendered on or after September 1, 1990. This requirement applies to all physicians and suppliers who provide covered services to Medicare beneficiaries, and the requirement to submit Medicare claims does not mean physicians or suppliers must accept assignment. Compliance to mandatory claim filing requirements is monitored by CMS, and violations of the requirement may be subject to a civil monetary penalty of up to 2,000 for each violation, a 10 percent reduction of a physician’s/supplier’s payment once the physician/supplier is eventually brought back into compliance, and/or Medicare program exclusion.” https://www.cms.gov/MLNMattersArticles/downloads/SE0908.pdf In other words, if covered services are provided to a Medicare beneficiary then Medicare rules must be followed regardless of participating status of the Provider. Furthermore, there is a one year time frame from when the services where provided for the Provider to submit a claim. If the Provider fails to submit the claim, or knowingly and willfully charges a beneficiary more than the applicable charge limits on a repeated basis, he/she/it may be subject to civil monetary penalties. Yet the rule provides a way out for some Providers. Amendment 4507 of the Balanced Budget Act of 1997 permits a physician or practitioner to “opt-out” of Medicare and enter into private contracts with Medicare beneficiaries if specific requirements are met. When a physician or practitioner opts out of Medicare, no services provided by that individual are covered by Medicare and no Medicare payment can be made to that physician or practitioner directly or on a capitated basis. Under the statute, the physician or practitioner cannot choose to opt-out of Medicare for some Medicare beneficiaries but not others; or for some services but not others. This is an all of none decision and the same must stand for at least two years. A very important point to consider is that only physicians and practitioners that are listed in §40.4 may opt out. For purposes of this provision, the term “physician” is limited to doctors of medicine; doctors of osteopathy; doctors of dental surgery or of dental medicine; doctors of podiatric medicine; and doctors of optometry who are legally authorized to practice dentistry, podiatry, optometry, medicine, or surgery by the State in which such function or action is performed; no other physicians may opt out. Also, for purposes of this provision, the term “practitioner” means any of the following to the extent that they are legally authorized to practice by the State and otherwise meet Medicare requirements: • Physician assistant; • Nurse practitioner; • Clinical nurse specialist; • Certified registered nurse anesthetist; • Certified nurse midwife; • Clinical psychologist; • Clinical social worker; • Registered dietitian; or • Nutrition Professional The opt out law does not define “physician” to include chiropractors; therefore, they may not opt out of Medicare and provide services under private contract. Physical therapists in independent practice and occupational therapists in independent practice cannot opt out because they are not within the opt out law’s definition of either a “physician” or “practitioner”. The steps to opt out vary slightly depending on the Medicare category of the practitioner. For example if the Practitioner is a Medicare NON-PARTICIPATING (NON-PAR) PHYSICIAN, then the recommended steps to opt out are as follows: 1. Notify patients that you are opting out of Medicare. 2. File a copy of an affidavit with “each carrier that has jurisdiction over the claims that the practitioner would otherwise file with Medicare (prior to entering into the first private contract but in no event later than 10 days after signing a private contract). 3. Enter into a private contract with the Medicare beneficiary (make sure to follow Medicare rules regarding Private contracts). A private contract, as provided in section 4507, 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 he or she furnishes to Medicare beneficiaries. 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. 4. Develop and implement policies and procedures to ensure that no claims are filed to Medicare for services rendered. 5. Send in a new “opt out” affidavit every two years to maintain your status. For Participating Physicians the steps are slightly different: 1. File a proper affidavit with an opt out date at least 30 days before the first day of the next calendar quarter showing an effective date of the first day in that quarter (i.e., January 1, April 1, July 1,October 1).” [From CMS Benefit Policy Manual (Rev. 147, 08-26-11) Sec. 40.17]. 2. Follow the above Steps for a non-participating physician Note: Participating Physicians may not provide private contracting services until the first date of the next quarter that is at least 30 days after receipt of the notice by the carrier. Keep in mind that Opt-out physicians and practitioners must not use ABNs, because they use private contracts for any item or service that is, or may be, covered by Medicare (except for emergency or urgent care services (see §40.28)). Furthermore, all Medicare replacement plans and patients under the same are still considered Medicare beneficiaries which means that the above rules apply to them. Also remember that the above information is provided as guidance only and do not constitute legal advice. http://www.ssa.gov/OP_Home/ssact/title18/1848.htm https://www.cms.gov/MLNMattersArticles/downloads/SE0908.pdf http://www.cms.gov/mlnmattersarticles/downloads/MM6874.pdf https://www.cms.gov/manuals/Downloads/bp102c15.pdf