The idea of opting out of Medicare might be scary for many physicians. I have yet to meet a physician that has regretted the decision to be free from Medicare.
This article and any suggestions are not to be considered legal advice. Please consult an attorney for any legal issues or questions.
Do I need to opt out of Medicare?
If you would like to offer membership services to Medicare-eligible patients (those age 65+, plus some others with disabilities, end-stage renal disease, or ALS), then you must opt out of Medicare.
According to the US government, any provider who remains a Medicare provider and charges membership fees to Medicare patients is committing Medicare fraud.
Can I start my DPC clinic without opting out of Medicare?
Yes, you can still operate a DPC clinic without opting out of Medicare.
You just cannot allow anyone who is Medicare-eligible to become a member. You would either have to bill Medicare as normal for those patients, or send them elsewhere for care.
Can I opt back in if I change my mind?
Yes, if you change your mind, you are able to opt back in to Medicare.
Once you first opt out, you have an initial period of 90 days where you can immediately opt back in. I call it the "whoops — I didn't mean to" period.
After that initial 90-day 'whoops' period, you are able to opt back in on every 2-year anniversary of the date that you opted out.
For example, if your opt-out effective date is October 1, 2026, your initial 'whoops' period lasts until December 30, 2026 to opt back in. After that, you are able to opt back in on October 1st in the years 2028, 2030, 2032, and so on. You would communicate your desire to opt back in at least 60 days prior to your opt-in date.
Can I still refer Medicare patients to specialists if I've opted out?
Yes and no. Some patients may have Medicare supplements that restrict referrals to in-network physicians — much like traditional insurance. You may want to consult with these patients before they sign up for a Medicare supplement plan that may be an HMO, EPO, or similar plan.
However, opted-out physicians will not have problems referring patients with Medigap plans or the traditional Medicare plan setup (Part A + Part B + Part D).
To lessen your stress, find a local, trusted Medicare broker that you can recommend to patients. Make sure they know how your DPC membership plan works and that you're an out-of-network provider.
How to opt out of Medicare
The process is quite easy. You should know whether you're a 'participating provider' (PAR) or 'non-participating provider' (non-PAR) — the process is only slightly different for each.
If you aren't sure, look up your State's MEDPARD directory and see if you're in there (do a web search for "MEDPARD [State name]"). If so, you're a participating provider.
Participating providers
If you are a participating provider, the effective date of your opt-out will be the first date of the following quarter — so long as you submit your opt-out affidavit at least 30 days prior to that date.
If necessary, notify patients you are opting out of Medicare.
File a copy of the "Opt-Out Affidavit" (example below) to "each carrier that has jurisdiction over the claims that the physician or practitioner would otherwise file with Medicare." See the list of carriers by state via the link below (Resources).
Once opt-out status is confirmed, you may enter into private contracts (membership) with Medicare patients. Each Medicare-eligible patient must sign a private contract (see the example below in Resources).
Set a reminder to have all Medicare-eligible patients sign a new private contract every two years. Ideally this is at or shortly after the provider's renewal status (in the example above, October 1, 2028, 2030, etc.).
Non-participating providers
Non-participating providers have an opt-out effective date the same as the signature date of the opt-out affidavit!
If necessary, notify patients you are opting out of Medicare.
File a copy of the "Opt-Out Affidavit" (example below) to "each carrier that has jurisdiction over the claims that the physician or practitioner would otherwise file with Medicare." See the list of carriers by state via the link below (Resources).
You may enter into private contracts (membership) with Medicare patients up to 10 days prior to the effective opt-out date (signature date). Each Medicare-eligible patient must sign a private contract (see the example below in Resources).
Set a reminder to have all Medicare-eligible patients sign a new private contract every two years. Ideally this is at or shortly after the provider's renewal status (in the example above, October 1, 2028, 2030, etc.).
How will I know if I've successfully opted out?
You should receive confirmation from your carrier, although timing may vary.
If you want to confirm your opt-out status, this website by CMS is your true confirmation.
Resources
Medicare carriers by state
CMS Provider Enrollment and Certification
Opt-out affidavit example
Copy and alter as necessary.
Opt-out affidavit
I, ______, declare under penalty of perjury that the following is true and correct to the best of my knowledge, information, and belief:
I am a physician licensed to practice medicine in the state of ______. My address is at _________, my telephone number is _________, and my [national provider identifier (NPI) or billing number, if one has been assigned, uniform provider identification number (UPIN) if one has been assigned, or, if neither an NPI nor a UPIN has been assigned, my tax identification number (TIN)] is _________. I promise that, for a period of two years beginning on the date that this affidavit is signed (the "Opt-Out Period") and continuing indefinitely with automatic extensions of the 2-year opt out period unless terminated by me as allowed by Title 1 Section 106(a)(1) Medicare Access and CHIP Reauthorization Act of 2015, I will be bound by the terms of both this affidavit and the private contracts that I enter into pursuant to this affidavit. [NOTE: Your personal UPIN number must be used, not a corporate UPIN number. Persons opt out, not corporations.]
I have entered or intend to enter into a private contract with a patient who is a beneficiary of Medicare ("Medicare Beneficiary") pursuant to Section 4507 of the Balanced Budget Act of 1997 for the provision of medical services covered by Medicare Part B. Regardless of any payment arrangements I may make, this affidavit applies to all Medicare-covered items and services that I furnish to Medicare Beneficiaries during the Opt-Out period, except for emergency or urgent care services furnished to Beneficiaries with whom I had not previously privately contracted. I will not ask a Medicare Beneficiary who has not entered into a private contract and who requires emergency or urgent care services to enter into a private contract with respect to receiving such services, and I will comply with 42 C.F.R. § 405.440 for such services.
I hereby confirm that I will not submit, nor permit any entity acting on my behalf to submit, a claim to Medicare for any Medicare Part B item or service provided to any Medicare Beneficiary during the Opt-Out Period, except for items or services provided in an emergency or urgent care situation for which I am required to submit a claim under Medicare on behalf of a Medicare Beneficiary, and I will provide Medicare-covered services to Medicare Beneficiaries only through private contracts that satisfy 42 C.F.R. § 405.415 for such services.
I hereby confirm that I will not receive any direct or indirect Medicare payment for Medicare Part B items or services that I furnish to Medicare Beneficiaries with whom I have privately contracted, whether as an individual, an employee of an organization, a partner in a partnership, under a reassignment of benefits, or as payment for a service furnished to a Medicare Beneficiary under a Medicare Advantage plan, during the Opt-Out Period, except for items or services provided in an emergency or urgent care situation. I acknowledge that, during the Opt-Out Period, my services are not covered under Medicare Part B and that no Medicare Part B payment may be made to any entity for my services, directly or on a capitated basis, except for items or services provided in an emergency or urgent care situation.
A copy of this affidavit is being filed with [the name of each local Medicare carrier], the designated agent of the Secretary of the Department of Health and Human Services, no later than 10 days after the first contract to which this affidavit applies is entered into. [FOR PARTICIPATING PHYSICIANS ONLY: My Medicare Part B Participation agreement terminates on the effective date of this affidavit.]
Executed on [date] by [Physician name]
[Physician signature]
[NPI, Social Security #, and date of birth, if you wish to be included in Medicare ordering and referring list]
Private contract example
Private pay (opt-out) medical services contract
CLINIC NAME
Private Pay (Opt-Out) Medical Services Contract
Section 4507 of the 1997 Balanced Budget Act allows a physician or practitioner to enter a private contract with a Medicare beneficiary.
WHY A SPECIAL CONTRACT?
I have not been excluded from providing medical services under Social Security Act Medicare (including sections 1128, 1156, 1892, CFR § 405, subpart D).
I _______________________________ (provider's name) have chosen to separate myself ("opt out") from Medicare.
My current opt-out started ______________, and ends ______________.
Because I opted out, Medicare requires I have you sign a private-pay medical services contract before I treat you.
WHO PAYS FOR SERVICES?
You pay the bill. You will have to use your own money to pay the ENTIRE cost of my services.
ARE THERE CHARGE LIMITS?
No, Medicare charge limits DO NOT apply to products or services you receive from me through this private-pay medical services contract. I am able to charge you whatever amount you and I agree to.
WILL MEDICARE HELP PAY?
No, Medicare will NOT help pay your bill. Because I separated from Medicare, it is against the rules for you to send a bill to Medicare for my services or ask to send the bill to Medicare for you.
BUT ISN'T THIS A MEDICARE-COVERED SERVICE?
Yes and no. Yes, Medicare would pay for the same service from a provider who is connected to Medicare. No, Medicare won't pay because I have separated myself from Medicare.
WHAT OPTIONS DO I HAVE?
You have the right to get your product or service from a provider connected to Medicare or from me, a provider separated from Medicare. Even if you get your product or service from me, you can always get products and services from providers connected to Medicare. These providers are not required to have you sign private-pay medical services contracts.
WHAT IF I AM HAVING A MEDICAL EMERGENCY?
This contract does NOT cover emergency or urgent care services. If you have an emergency or urgent medical need, ask me for help. It is against Medicare rules for me to have you sign a private-pay medical services contract for emergency or urgent medical services.
WILL MY MEDIGAP OR OTHER SUPPLEMENTAL PLAN HELP PAY?
No, Medigap plans WILL NOT help pay for products or services you get from me. If you have some other medical insurance plan, it MIGHT NOT help pay your bill either.
WHAT ELSE DO I NEED TO DO?
If you decide to sign this contract, I will also sign the contract. You may also get a copy of the contract to keep. This way you will have a copy to look at if you have any questions about the contract in the future.
WILL CMS GET A COPY OF THE CONTRACT?
I, the provider, will supply a copy of this contract in the event CMS requests a copy.
ELIGIBLE PRACTITIONER INFORMATION
Provider's NPI:
Provider's Signature: Date:
Patient's Signature: Date:
Patient's Legal Representative Signature: Date:
Witness Signature: Date:
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Have questions about opting out?
Physicians in the community have been through the affidavit, the carrier filing, and the private contracts. Join us and ask what you're stuck on.