Medicare: To Participate or Not to Participate?

Understanding options can help you make a better decision about your status.

During the last six weeks of each year (Nov. 15-Dec. 31), providers are permitted to change their participation status with Medicare. In making this decision, many questions may arise: What does participating vs. non-participating mean? What are the pros and cons of each option? How do I change my status? The information below can help you make a more informed decision. 

“Par” versus “Non-par”
Simply put, the primary difference between the two statuses lies in how you collect your fees. Participating providers must accept assignment (wait for payment directly from Medicare), while non-participating providers may collect up-front from the patient (non-assigned claims). That is, if you are a participating provider, your patient pays you a deductible and co-insurance and then Medicare reimburses you for the rest of the allowed fee.  Non-participating providers may collect their allowed fees in full from the patient and the beneficiary is then, in turn, partially reimbursed by Medicare. For non-covered services (anything that is NOT spinal manipulation), all providers, regardless of status, may collect up-front from the patient.

Billing as a Participating Provider
As a participating provider, if the beneficiary’s deductible has not been met, you may collect the “par allowable” amount from your patient in full and bill Medicare your regular fee. Any difference between the two amounts is written off as a loss. Note that the par allowable amount is determined by the fee schedule for your carrier/MAC and geographic area. You are encouraged to check with your local Medicare contractor, or use the ACA Web site, to find the most up-to-date information.

If you are a participating provider and the deductible has been met, your patient is responsible for 20 percent of the par allowable fee and you could still bill Medicare for up to your regular fee. Medicare would then pay you 80 percent of the par allowable and, again, any difference between the billed fee and the allowed fee is written off as a loss.

Billing as a Non-Participating Provider
For non-participating providers, the process is different.  If you are non-par, not accepting assignment, and the patient’s deductible has not been met, you are subject to charging a maximum of the limiting charge (determined by your fee schedule). Your patient pays you the full amount of up to the limiting charge, you bill Medicare for the fee (up to the limiting charge), and Medicare applies the non-par allowable fee to the patient’s deductible. 

If you are non-participating, not accepting assignment, and the deductible has been met, your patient would still pay you up to the limiting charge and you would still bill Medicare for that amount. Medicare would then reimburse the patient 80% of the non-par allowable fee.

If you are a non-participating provider that accepts assignment, you must accept the non-par allowable as payment in full. If the patient’s deductible has not been met, the patient pays the full non-par allowable. If the patient’s deductible has been met, the patient would be responsible for 20 percent of the non-par allowable fee and Medicare would reimburse you for the remaining 80 percent. Again, as with par, any difference between allowed and billed fees must be written off.

Pros and Cons
Non-participating doctors of chiropractic may be paid slightly more for services by choosing that status. The downside of this is that those extra dollars come from the patient, not the federal government. 

Participating providers have the advantage of being able to enter any fees they wish on the claim form when billing Medicare and the carrier will adjust the amount to reflect the current allowable fees determined by the fee schedule. This can be useful in times when the fee schedule levels are changing or uncertain and may ease the burden of locating the current values.

Participating providers also would be listed in the MedParD (Medicare Participating Directory). This is a directory of all current participating providers and is sent to every Medicare beneficiary at the beginning of each year.

In addition, participating providers always have the right to appeal. This is not true for non-par providers.

Opting Out of Medicare
Doctors of chiropractic are not among those professions that are allowed to “opt out” of Medicare.  During the drive for the chiropractic demonstration program several years ago, ACA leadership did not push for inclusion in that statute because lobbying for expansion within the system while concurrently asking to be let out of the system would send a mixed message to our allies on Capitol Hill.  Being able to opt out, however, may be a provision ACA presents in a full-scope/parity package to Congress sometime after a full analysis of the demonstration program is delivered to Capitol Hill. Certainly, in the interim, doctors of chiropractic who do not want to be involved in Medicare always have the option of simply choosing not to treat Medicare patients.

Please note that the requirements for opting out of Medicare are quite involved and many doctors find them to be overwhelming. It’s not as simple as signing a form and becoming a cash practice. There are numerous regulations that must be followed and practices that must be upheld (e.g., fee restrictions). Less than 2 percent of eligible providers choose to opt out of Medicare.

Changing Your Status
Typically providers are given the last six weeks of the calendar year (Nov. 15-Dec. 31) to change their participation status. Once made, the decision is binding throughout the following calendar year (unless the decision period is re-opened). Another exception could be in situations where a physician’s practice changes significantly, such as relocation to a different geographic area or transformation into a group practice.

If you are currently non-participating and wish to become participating, you must sign a participation agreement (available from your carrier). If you are currently a participating provider and wish to become non-participating, you will need to submit a letter (on office letterhead) to your local carrier or administrative contractor stating your intent to become non-participating. This letter must include an original signature of the authorized representative or individual provider. If you wish your status to remain unchanged, you need not do anything.

 ACA is not advising or recommending either of the options described in this article. The purpose of the article is to ensure decisions about Medicare participation are made with complete information about the options available to doctors of chiropractic. Susan McClelland contributed to this article.