Medicare Opt-Out Guide¶

Quick Summary: Opting out of Medicare allows you to see Medicare beneficiaries without Medicare billing constraints. The process requires a signed affidavit filed with your Medicare Administrative Contractor (MAC), and patients must sign private contracts before receiving services. Opt-out periods are two years, with automatic renewal.

What is Medicare Opt-Out?¶

Medicare opt-out is a formal process that allows physicians to:

See Medicare beneficiaries outside of the Medicare program
Charge patients directly without Medicare billing limitations
Establish private contracts with Medicare patients

What opt-out is NOT: - Simply not enrolling in Medicare - Just not accepting Medicare patients - Dropping Medicare participation

[!IMPORTANT] If you are enrolled in Medicare (participating or non-participating), you cannot simply stop billing. You must formally opt out OR continue to comply with Medicare rules for any Medicare-covered services you provide to beneficiaries.

Why DPC Physicians Opt Out¶

Without opt-out, problems arise: - Medicare beneficiaries cannot pay you privately for Medicare-covered services - Even if you don't bill, you may be obligated to bill - Accepting cash for covered services without opt-out may violate Medicare rules

With opt-out: - Medicare beneficiaries can pay DPC membership fees - You have a clear legal framework for private-pay relationships - No Medicare billing, claims, or audits for opted-out services

Common DPC approach: Most DPC physicians who see Medicare-age patients choose to formally opt out, even if they never enrolled in Medicare in the first place, to ensure complete clarity.

Who Can Opt Out¶

Eligible to opt out: - Physicians (MD, DO) - Practitioners (PA, NP, CNS, CRNA, CNM, psychologists, etc.)

Cannot opt out: - Physicians/practitioners who have signed Medicare participation agreements within the current opt-out period - Those with pending Medicare claims at time of opt-out affidavit

Timing: You can opt out at any time, but: - Existing Medicare claims must be settled first - If currently participating, wait until participation agreement expires

The Opt-Out Process¶

Step 1: Confirm Eligibility¶

Ensure no pending Medicare claims
If currently enrolled, confirm no participation agreement conflicts

Step 2: Prepare Affidavit¶

The opt-out affidavit must include:

Your name and address
Physician/practitioner type (MD, DO, etc.)
Statement that you understand:
You're agreeing not to submit Medicare claims for two years
Medicare will not pay for services you provide
Patients cannot bill Medicare or seek reimbursement
Statement that you'll enter private contracts with Medicare beneficiaries
Statement that you understand private contract requirements
Your signature and date

Step 3: File with Your MAC¶

Find your Medicare Administrative Contractor (MAC): - CMS MAC List - MACs are regional; file with the MAC for your practice location

How to file: - Mail or fax to your MAC - Some MACs accept electronic submission - Keep proof of submission (certified mail receipt, fax confirmation)

When it takes effect: - Opt-out is effective the date the MAC receives your affidavit - You can begin seeing Medicare beneficiaries under private contracts immediately upon filing

Step 4: Prepare Private Contracts¶

You must have signed private contracts with Medicare beneficiaries BEFORE providing services. See Private Contracts below.

Private Contracts¶

Requirements¶

Every private contract with a Medicare beneficiary must:

Be in writing
Be signed by the beneficiary (or legal representative) BEFORE services are provided
State that the beneficiary:
Agrees not to submit claims to Medicare
Understands Medicare will not pay
Accepts full responsibility for payment
Acknowledges no Medicare limits apply to what you charge
Not be entered into during a medical emergency

Sample Private Contract Language¶

Private Contract for Services Not Covered by Medicare

Patient Name: _______________ Date: _______________

I understand that:

Dr. [Name] has opted out of the Medicare program.

I agree to pay Dr. [Name] directly for all services provided.

Medicare will not pay for any services provided by Dr. [Name] during the opt-out period.

I cannot submit claims to Medicare for services provided by Dr. [Name], and no Medicare payment will be made for such services.

I am not currently facing a medical emergency.

Medigap or other supplemental insurance will not pay for these services.

I enter this contract freely and voluntarily, understanding that I have the right to receive services from physicians who have not opted out of Medicare.

This agreement applies to all services provided by Dr. [Name] during the current two-year opt-out period.

Patient Signature: _______________ Date: _______________

Physician Signature: _______________ Date: _______________

DPC Integration¶

For DPC practices, the private contract can be: - Part of your membership agreement, OR - A separate document signed at enrollment

Recommended: Include private contract language directly in your DPC membership agreement for Medicare-age patients, so everything is in one document.

Maintaining Opt-Out Status¶

Automatic Renewal¶

Opt-out periods are two years
Opt-out automatically renews unless you terminate
No need to re-file affidavits for renewal

Ongoing Requirements¶

Keep signed private contracts on file for all Medicare beneficiaries
Maintain private contracts for the duration of opt-out period
Do not submit any claims to Medicare

If You Add Practice Locations¶

You may need to notify additional MACs for new practice states
Maintain opt-out status in all locations where you see Medicare beneficiaries

Terminating Opt-Out¶

If you decide to end your opt-out and return to Medicare:

When You Can Terminate¶

At least 30 days before the end of the current two-year opt-out period
Must provide written notice to your MAC

What Happens¶

You can re-enroll in Medicare
You cannot submit claims for services provided during the opt-out period
Existing private contracts remain in effect through their terms

Important¶

Once you terminate opt-out: - You cannot opt out again until after a new two-year period - All Medicare rules apply immediately

Common Questions¶

Do I need to opt out if I never enrolled in Medicare?¶

Recommended yes. Filing an opt-out affidavit provides clear documentation of your status. Some attorneys advise opting out even if you've never enrolled, to create an unambiguous paper trail.

Can Medicare beneficiaries use their Medigap insurance?¶

No. Private contracts are completely outside Medicare. Medigap policies only supplement Medicare payments—if Medicare doesn't pay, neither does Medigap.

What about Medicare Advantage patients?¶

Medicare Advantage plans (Part C) are administered by private insurers, but they're still Medicare. The same opt-out rules apply. Patients with Medicare Advantage cannot use their plan benefits for your services.

Can I see some Medicare patients under Medicare and others under private contract?¶

No. Once you opt out, you're out for all Medicare beneficiaries for the entire opt-out period. You cannot see some patients under Medicare and others privately.

What if a patient has a medical emergency?¶

You cannot enter a private contract during a medical emergency. If you provide emergency services to a Medicare beneficiary, standard Medicare rules may apply. For DPC, ongoing established patients already have private contracts in place before any emergency arises.

Can I opt back in before two years?¶

No. The two-year opt-out period is mandatory. Once you file, you're committed for two years.

Checklist¶

Before Filing¶

Confirm no pending Medicare claims
Review any participation agreement terms
Prepare affidavit language
Identify your MAC

Filing¶

Submit affidavit to MAC (certified mail recommended)
Keep copy of affidavit and proof of submission
Note the effective date

Operations¶

Prepare private contract template
Integrate private contract into membership agreement (for DPC)
Train staff on Medicare patient intake
Have all Medicare beneficiaries sign private contracts before services

Ongoing¶

Maintain signed private contracts on file
Track two-year opt-out period end date
Decide on renewal vs. termination 30+ days before period ends

Resources¶

CMS Medicare Opt-Out Information
CMS MAC Contact Information
42 CFR 405.400-405.445 — Medicare opt-out regulations

Medicare opt-out is a straightforward process, but documentation matters. File properly, maintain your private contracts, and keep good records.