Practice Management Alert

Analyze your patient base to see how opting out will affect your bottom line

If your practice wrestles with the possibility of opting out of Medicare and you're apprehensive about the outcome, you're not alone. Medical Office Billing & Collections Alert has compiled the five most-pressing questions billers ask when weighing the benefits of opting out. Allow our expert answers to aid your decision:

1. Question: How will our practice benefit from opting out?

Answer: "The purpose of opting out is to get rid of the middle man and make the fair profit you're supposed to," says Quin Buechner, MS, MDiv, CPC, president of ProActive Consult- ants in Cumberland, Wis. If you've been collecting inadequate reimbursement on a portion of your services and procedures, it may make more sense to opt out and bill what you deserve.

And, opting out can actually make it easier for some physicians to provide complete care to their patients. If a physician's patient base requires certain treatments that Medicare doesn't cover, both the provider and patient might grow increasingly frustrated. And often Medicare patients find themselves having to foot the bill for aspects of their care, says Wayne J. Miller, attorney with Compliance Law Group in Los Angeles. If some of your Medicare patients have to pay for portions of their care anyway, you may as well opt out and avoid the regulatory hassles of Medicare participation, he adds.

2. Question: What should we do first if we're considering opting out?

Answer: First you need to evaluate your patient base and your financial plan to determine exactly how opting out will affect your bottom line, Buechner says. You should analyze your Medicare patients' other insurers, the type of care you're providing, and whether Medicare offers adequate coverage for rendered services, Miller says.

Seek legal counsel to help you develop the necessary documents to opt out experts recommend. Some Medicare patients may have secondary or supplemental insurance with a provision that guarantees coverage only if your practice bills Medicare first, Miller says.

If you're concerned about still being able to provide care to some of your Medicare patients, you should make sure opting out won't disqualify some patients from other insurance coverage in your practice, he adds. And ensure you will still be able to receive payments from secondary or supplemental insurances by checking first to see if your carriers have certain filing requirements for providers who don't participate with Medicare.

3. Question: Which practices will most likely benefit by opting out of Medicare?

Answer: Specialists are more likely to opt out than general practitioners because they often see more self-pay or privately insured patients. This can make participation with Medicare not worth the billing hassles and lower reimbursement rates. However, every practice is different and may have valid reasons to consider opting out, Miller says. "Even primary- care doctors may have a particular patient base, such as older patients who have a chronic disease" that merits certain treatments for which Medicare doesn't provide adequate coverage, he says.

Providers have successfully opted out of Medicare when they "identified that a lot of their services were not covered, or not covered adequately," or when their practice seemed subject to a very high audit rate due to Medicare's unreasonable concern about medical necessity or frequency of services, Miller says. Over time, the cost of fighting with all of these hassles just isn't worth it, he adds.
 
4. Question: What forms does Medicare require before we can opt out?

Answer: Medicare essentially requires two documents from a provider who wishes to opt out. The first is an affidavit stating the date when you will become non-participating with Medicare and outlining the standard terms of the agreement (for example, the provider agrees not to charge Medicare for any service, and the provider agrees not to represent himself as a participating provider with Medicare), Miller says. You will need to file this affidavit with your local Medicare carrier.

The other required document is a private contract the provider must sign with each of his patients who have Medicare coverage, Miller says. The contract basically states the same terms as the affidavit, plus ensures that the patient understands that the provider will not bill any rendered services to Medicare. A provider who decides to opt out should develop such a contract with the help of legal counsel, Miller says. Medicare rules establish the format of the contract, but the details are up to the provider. You should keep on file a copy of the contract signed by each Medicare patient, he adds.

5. Question: Which services will we be able to offer to Medicare patients after we opt out?

Answer: You will be able to treat patients with Medicare coverage just like before. The only difference will be that you won't bill Medicare for the service. Instead, you will try to collect from any secondary or supplementary insurance the patient may have, or simply bill the patient. Because you will no longer be subject to any of Medicare's rules and regulations pertaining to billing, you may even be able to offer a discount off of your standard fees to a Medicare patient who has financial need and wishes to see your physician and pay out-of-pocket, Miller says. Depending on the circumstances, you may actually be able to offer the patient a discounted price and still charge more than Medicare would pay, thereby benefiting both parties.