Opting out

January 18, 2008

A member of my group is fed up with Medicare. He has his Medicare patients sign an Advance Beneficiary Notice prior to rendering services, then the patients pay him and he tells the billing department not to file claims for those services. I'm concerned that what he's doing isn't correct, and that his actions will negatively affect the group. Am I overreacting?

A member of my group is fed up with Medicare. He has his Medicare patients sign an Advance Beneficiary Notice prior to rendering services, then the patients pay him and he tells the billing department not to file claims for those services. I'm concerned that what he's doing isn't correct, and that his actions will negatively affect the group. Am I overreacting?

No. Having the patient sign an ABN for services that are routinely covered by Medicare is totally inappropriate and violates the provider participation agreement. If your colleague really wants to quit Medicare, he has the ability to "opt out." He'd have to file an affidavit with each Medicare carrier that has jurisdiction over his claims that states he forgoes payment from Medicare for two years, and that he will enter into private contracts with any Medicare patient who decides to continue to receive care from him and who will pay him his fee. But this can get tricky. If he opts out, you'll have to create a system for differentiating his patients from the rest of the group's. And you'd have to make sure the staff doesn't submit a claim for his Medicare patients by mistake.

All the requirements involved in private contracting can be found in the Medicare Benefit Policy Manual, Chapter 15, beginning with section 40.1 at http://www.cms.hhs.gov/manuals/Downloads/bp102c15.pdf. Should your colleague decide this is the path for him, contact a healthcare attorney to help guide everyone through the process.

The author, vice president of operations for Reed Medical Systems in Monroe, MI, has more than 30 years' experience as a practice management consultant, as well as being a certified coding specialist, certified compliance officer, and a certified medical assistant.