Medicare beneficiaries usually won’t have a problem finding a doctor who accepts Medicare assignment. There are over 900,000 physicians in the United States that accept Medicare assignment, meaning that they accept the fees dictated by the Medicare program.
But what aren’t they telling you? Is your care hindered by the insurance plan? Are there other treatment options available to those who do not have Medicare? Why do some providers choose to remain in the Medicare program and others choose to opt out of the program entirely?
The Choice to Opt-Out of Medicare
If a provider opts out of the program, they can still treat Medicare patients. However, those patients will have absolutely no financial assistance from the Medicare program, except in emergency instances. Even if the services are covered under Original Medicare, there will be no payment from Medicare to either the provider or the patient if the provider has opted out of the program.
Some patients who choose to see a provider who has opted out of Medicare set up payment terms with their provider via a private contract.
Providers who wish to opt out of Medicare must remain out of the program for two years. After two years, the opt-out status automatically renews unless the provider requests otherwise.
Doctors in wealthy, urban areas have removed all insurance plans from their practice, treating only cash-paying patients.
Patient-Provider Private Contracts
Assuming you do not want to see a provider who administers care through Medicare, you will sign a payment contract with your provider. You will be responsible for paying the full amount of the provider’s fees for services. The payment plan for that amount is negotiated between you and your provider.
If you have a Medicare supplement, or Medigap, plan, it will also not pay for services rendered.
Prior to signing the contract, your provider must make it clear if you could get the same services from a Medicare provider at a lower cost. They must also tell you if they have been excluded from the Medicare program for any reason. You are not required to sign a private contract for urgent or emergency services.
Limiting Medicare Patients
Physicians who accept Medicare assignment do have the right to limit the number of Medicare patients they take into their practice or facility. In fact, approximately 20% of physicians and 31% of primary care providers do just that. They limit the number of Medicare patients they will see at any given time.
Why? Because the reimbursement rate set by the Medicare program can be low for many services. Among those providers who limit Medicare patients, 85% of them think that the rates are too low and the likelihood of future payment cuts makes Medicare a very unreliable payer. Private insurance companies and cash patients have a much higher price tag, which increases profits for the provider and facility.
Some say these payments cuts stem from the inability of Congress to permanently set the formula that the Medicare program uses to reimburse doctors. The formula does not allow for increased payments.
Over-Diagnosing with Aggressive Medical Coding
There are some providers who have chosen to remain part of the Medicare program that have tried other ways to increase their reimbursements. The Medicare program uses medical diagnosis codes to determine the reimbursement amount. The more severe or complicated the diagnosis, the higher the payout.
There have been accusations of providers and facilities changing diagnosis codes to reflect a more severe condition – a sicker patient. Since the Medicare system relies on the honor and integrity of providers, many of these over-diagnoses go unnoticed.
It is estimated that this practice cost the Medicare program $11 billion in excess charges from 2001 to 2010.