Opt-Out of Medicare and Secondary Insurance


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One of our providers is debating opting out of Medicare entirely. Many of her patients have secondary insurance in the for of supplemental and true "commercial" secondary. Though I've contacted many insurance companies, about this, none of my reps have responded with a definitive answer...

If we submit a claim to the patients secondary (out-of-network) insurance, attaching the official opt-out letter, how will the claim reimburse? Naturally, a supplemental plan will deny since 20% of $0.00 = $0.00. But if the secondary is NOT a supplemental plan, and is out-of-network, would it process as if Medicare wasn't even part of the equation providing the patient has out-of-network benefits?

Thank you!


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My assumption would be that, whether Medicare was the primary or secondary insurance, that the companies would would process things based upon Medicare fees and may not cover anything unless Medicare is filed also.

In my experience, any time you file an out of network claim, your reimbursement is a crap shoot at best in terms of whether they pay you anything and, if they do pay you, what the amount paid is.

Your doctor may be better off, while also removing any billing headaches for you, by starting a concierge type format where patients either pay per visit out of pocket or pay a monthly "subscription" fee.


True Blue
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If you are an opt-out from Medicare you area also and opt-out of Medicare advantage, Medicare supplement and any other Medicare based plans.

Source (that's what CMS has told us as a Medicare advantage payer)..

Now if you are talking about Commercial plan as secondary to Medicare. They will likely pay if you are in network or an out of network provider type where patients don't have a choice such as Anesthesia or ER.
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Regarding Medicare:
"Physicians may choose to opt-out of Medicare and privately contract to provide healthcare services to patients outside the Medicare system. Opt-out physicians may charge whatever they desire to patients as they are not subject to Medicare’s fee schedule or limiting charge. An opt-out physician does not file any claims to Medicare (except in emergency cases) and receives no Medicare payment either directly or indirectly. They are prohibited from receiving payments individually, as an employee of an organization, a partner in a partnership, under reassignment of benefits, or as payment for a service furnished to a Medicare beneficiary under a Medicare Advantage plan (capitation). A private contract must be signed by the patient stating they understand that the patient is giving up Medicare payment for services furnished by the provider. Once a provider opts out of Medicare, they cannot submit Medicare claims for any patient for a two-year period.

The private contract must meet specific requirements that the provider and patient enter into for services. It must be in writing and signed by the beneficiary before any item or service is provided. The contract must not be entered into at a time when the beneficiary is facing an emergency or an urgent health situation. The contract must also state specifically that by signing the private contract, the beneficiary (patient):

- Gives up all Medicare payment for services furnished by the “opt-out” provider
- Agrees not to bill Medicare or ask the provider to bill Medicare
- Is liable for all of the provider’s charges, without any Medicare balance billing limits
- Acknowledges that Medigap or any other supplemental insurance will not pay toward the services
- Acknowledges that he or she has the right to receive services form providers for whom Medicare coverage and payment would be available

The provider also must file an affidavit that meets specific requirements and submit to the local MAC at 30 days before the first day of the next calendar quarter. The affidavit agrees that the provider will forgo receiving any payment from Medicare for items or services provided to any Medicare beneficiary for the following two year period either directly or indirectly (as described above). If the provider was a participating provider and is changing to opt-out, they must file the affidavit with carriers that have jurisdiction over claims that they would otherwise file with Medicare no later than 10 days after the first private contract is entered into with a beneficiary. The providers then have a 90 day period after the effective date of the first opt-out affidavit during which they can revoke the opt-out and return to Medicare, if they wish. It would be as if they had never opted out."

The secondary payer is secondary for a reason. Through the process of COB, that determination was made. If the intent is to bill only the secondary, non-supplemental payer, it's likely that they will deny for COB and request the Medicare EOB. In the case of opting-out, the agreement made with the patient is that they are liable for payment in full for any charges. If you bill the secondary, non-supplemental payer, you'd be going against the contract as the secondary payer is not contractually liable for any payment.

I think the requirement for the contract with the patient will put you in a dire position when it comes to any payments from any other payers. The patient is basically taking full responsibility for payment, subsequently removing all liability from any other payer. I'm not sure that's the best road to travel.