I’ve been getting a few similar questions about the pros and cons of being a Non-Participating Provider with Medicare, and would like to address them here. You can see this post on Medicare for details on what that means if you are not familiar, but just to quickly review…
There are three possibilities for a Physical Therapist’s relationship-status with Medicare:
1) No relationship at all (not the same as a “Non-Participating Provider” and also not the same as “opting out”)
2) Participating Provider
3) Non-Participating Provider
A little more detail on the Non-Par Status: You can accept self-payment from the beneficiary at the time of service, but you still must send in the claim to Medicare. Medicare will then send any reimbursement directly to the patient. As a Non-Participating Medicare Provider, you can bill the patient up to 115% of the Medicare Fee Schedule.
So what kinds of questions does this status bring up? …
If you are a Non-Participating Provider, do you still have to deal with all the same paperwork, possible audits, and other hassles of Medicare? If so, what is the point of being a Non-Par provider?
I’ve never been a Non-Par Provider, but I know that you still have to bill Medicare directly so I would guess that your paperwork requirements would be very similar to Participating Providers. I’m sure the possibility of being audited is still there as well, but I’ don’t know if there are any differences in the chances of being audited. So what is the point? …
As a Non-Par Provider, unlike practitioners who have no relationship with Medicare, you can still provide “covered” skilled PT services for Medicare beneficiaries. This is hugely important for some practices in certain areas with certain demographics. Non-Par Providers can also take payment in full at the time of service directly from the beneficiary, so they are not waiting for a 3rd Party Payor to reimburse them. Furthermore, the billing can be up to 115% of the Medicare Fee Schedule, so you can get a little more money for your time as a Non-Par Provider.
Is the hassle of dealing with Medicare paperwork and regulations really worth the extra 15% you can bill as a Non-Participating Provider?
Dealing with Medicare is complex and riddled with headaches, but there are a number of other things to consider when asking yourself this question. First and foremost, you need to put the 15% topic aside and look at how important it is for your practice to be able to provide covered PT services to Medicare beneficiaries. Are you in an area where the vast majority of those seeking PT are over 64 years old? Could you keep your practice busy if you were not able to treat this part of the population? Remember, if you are not enrolled as either a Participating or a Non-Participating provider, you cannot provide beneficiaries with PT services that Medicare would normally cover.
You should also consider how important it is to you as a practitioner to be able to treat Medicare beneficiaries. I know some PTs who are not really concerned about having or not having that ability in their practice, and I know some who couldn’t imagine practicing PT if they were not allowed to treat Medicare-aged patients.
If you feel that you need to be able to treat Medicare beneficiaries, either financially or personally, but don’t want to wait for Medicare reimbursement (or denials), then being a Non-Par Provider might be a an option to consider regardless of the extra 15% you can bill.
Do you recommend new cash-based practice owners to become Non-Par Providers with Medicare since they can bill the extra 15%?
Again, the answer to whether or not to become a Non-Par Provider (rather than having no relationship at all with Medicare) really shouldn’t be about the 15% extra you can bill. If you think your practice can thrive without treating Medicare beneficiaries, you personally don’t mind being unable to treat them, and you would rather avoid the hassle of dealing with Medicare at all, then don’t enroll as a new practice. You will have to hire someone to do all the billing or take the time to do it yourself.
One scenario in which I think being a Non-Par Provider makes a lot of sense is the following: You are currently a Participating Provider with Medicare and you want to transition into more of a cash-based model, but still want to be able to treat Medicare beneficiaries. The infrastructure, staff, and processes are already in place to bill Medicare, so it makes sense if you still want to (or need to) treat this part of the population.
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I have been a participating provider w/ MC in an insurance-based practice for many years. having gotten all the kinks out of the system, it works well for me and MC is definitely my star reimbursement right now. As I transition into a cash-based practice, I am thinking that MC will be the last contract I pull out of. Has anyone had a insurance-based practice and been a MC participating provider and then transitioned to a non-par provider,and if so, how much hassle was that with MC to make that change? Going forward from that point, what was the hassle factor in converting from non-par to not participating?
Thanks!
correction on last line of my previous comment: S/H/B non-par to opting out.
I am non par with all insurance except Medicare. I’ve considered being non par with Medicare. The important fact that was not mentioned is that, while we can bill an additional 15%, Medicare reduces the fee schedule by 5%. While this is ridiculously unfair to both providers and beneficiaries, it is my understanding of the rule.
I keep considering and reconsidering making the change to non par status with Medicare but I do believe that all of the rules remain in place for compliance. Medicare is highly unlikely to make things easier for those who choose to live outside of their world.
It would be great to hear of the experience of practioners that are non par with Medicare.
Thanks for comment, Jim. Just curious … when you said “Medicare is highly unlikely to make things easier for those who choose to live outside of their world,” did you mean to say “inside” their world? If you’re in their system in any way, they certainly have much more power and influence to make things difficult for you, versus if you have no relationship at all.
Jim, I started a home-based out-patient PT business a few months ago, with the endeavor to transition to a clinic as well. I am curious as to why you are considering becoming Non-par with Medicare, as it seems that you have successfully run things with being Par with Medicare only. Your expertise and opinion would be greatly appreciated.
You’re not allowed to be non participating with Medicare as a PT. It’s illegal. Read the laws.
Thanks for trying to clarify this again. What choices do I have if I am listed as a provider of Medicare because I used to work full time at a clinic? Now I have my own cash-based business. Is my only option to be a non-par? Because that is certainly not how I have been doing it. When I started I just thought I had no relationship because it was just me. Had you never been part of a larger clinic where this applied to you?
Thanks again.
First of all, congrats on starting your cash-based clinic!!
You really need to call CMS and ask them your specific questions… It seems like people get a different answer to their questions almost every time they call CMS, and that’s why I encourage everyone to double check all of this information. Also, the rules surrounding Medicare seem to change every year. With all that said:
I’ve never had to un-enroll because Medicare required a reactivation a while back, before I started my own practice. So my previous provider status (with a former employer) went away on its own. But you are likely still considered a Participating Provider and need to change it asap (and stop providing covered services to MC Beneficiaries until you do)
Please check out: https://pecos.cms.hhs.gov/pecos/login.do
There’s a link by “deactivated” that looks like it might explain how to deactivate a current enrollment. I believe you can also change your status with Medicare during the open enrollment period… I.e. change from participating to non-participating, but this of course would NOT be a full deactivation and ending of the relationship.
The problem lies in the fact that I am still per diem at a insurance-based clinic, so until I am off there, I can’t change my status. And like you said, even if I do change my status, it will be switching to non-participating. Which still leaves me having to deal with Medicare. After calling CMS, I don’t even have an opportunity to change my status until next year, because that has closed (even though it’s done online anyhow). So frustrating! I’m hoping the new legislation proceeds forward to allow physical therapists to opt-out as is available for other professionals. Thanks again for helpful info!
You’re very welcome!
Unfortunately, I have to say the following about legislation going through that will allow us to “opt out”… don’t hold your breath. It’ll likely be very far in the future before we have any chance at that.
Hi Jared and Tianna,
I graduated 1 yr ago and have been working at a private practice and wasn’t required to be authorized as a Medicare provider. The private practice is now being sold and the new owners are requiring I become medicare authorized. I am hesitant on this because I know you cant opt out and someday I may want to open my own cash pay practice. Do either of you guys have any advice on whether I should find a new job or if getting Medicare authorized will affect me in the future?
Hi, how does this apply to Medicare HMOs…..I am also opening my cash based practice: Embody Physiotherapy &Wellness and have a client that has a medixare HMO…she was paying by cash at my my previous large payer employer? My understanding is that I am just oit of network for her, but with straigjt Medicare the above information appliesm. Thanks, Susan
As for as I know, if she is a Medicare beneficiary, you can’t provide covered services on a cash-pay basis. You may want to call APTA or CMS to ask specifically about the “HMO” part of it all, but I’m pretty sure it doesn’t change these basic rules
Jared,
If they have signed over there medicare benefits to be managed by an HMO then the MC rules no longer apply.
Thanks Todd! Funny you left that comment just now because two days ago I sent an email to the APTA attorneys to confirm/disprove exactly what you just stated above. We’ll see.
Could you share with us where you received this information?
I’m still in the process of researching this point. I initially received an answer confirming your statement, and then the APTA attorneys followed up with CMS and were told the opposite! Don’t want to say one way or the other before I know for sure, but would like to ask you exactly how you came to that conclusion and whether or not you’ve ever had issues with charging MC HMO/Advantage patients on a cash-pay basis??
Once you sign your Medicare benefits over to a HMO type plan (lets say Humana) then you are no different than a typical HMO plan recipient. It’s been this way forever and anyone who tells you different really doesn’t know how the system works (APTA lawyers). I’m currently contracting in big corp setting and they see MCA patients who are treated exactly like HMO patient, if fact they are now HMO patient’s because they signed those MC rights away. I’ve been treating for 20 years and it’s always been this way although I don’t have a link for you as proof but I can assure you these big corps have lots of money to lose if they didn’t treat appropriately they would have been fined.
Thank you again for the input Todd. I’m sending your wise words to the APTA lawyers (not with your name on it of course 🙂 to see what they have to say. So far, I have received a number of different answers to the same question. My search continues before I can put my stamp of confidence and present it to my audience. Thanks again!
Jared and Todd,
This is very exciting news!! I’ve turned away these patients in past, and they would be so happy if they could see me. I have a cash based practice. Any confirmation that the ones with Medicare Advantage or Medicare with HMO plan can pay out of pocket and not submitted to MC?
This is yet another one of those areas where the answer can change based on a number of different factors. I know of some practice owners who are adamant that beneficiaries with Medicare Advantage plans can be treated and viewed as patients with private insurance. They say they have been doing so and collecting private payment for years without any issues.
The ultimate answer to the above question is that it really depends on the individual Medicare Advantage Plan of that given patient. There are a wide variety of plans and their rules surrounding this topic may vary from one to the next. There are coordinated care options such as HMOs or PPOs, private fee-for-service (PFFS) plans, and medical savings account (MSA) plans. The most common form of Medicare Advantage plan is the HMO.
Apparently, there are a number of Medicare Advantage plans in which coverage is limited to only in-network providers. In some of these situations, if the beneficiary decides to go out-of-network for PT services (regardless of whether or not they are normally “covered services” in Medicare), they would be “on their own” for payment, and the out-of-network provider could accept self-payment from that beneficiary. Hooray! However, I must emphasize that this can change on a case-by-case basis, so the take-home point is this …
If a beneficiary with a Medicare Advantage plan wants to see you on a cash-pay basis, and you are out-of-network with that plan, you need to call the plan and ask them if it is okay for you to provide them with covered services and that the beneficiary pay you directly out-of-pocket. As always, document whom you spoke with and exactly what was said. If possible, have them email you confirmation of the information they gave you so that you have it in writing.
For more general info on Medicare Advantage plans go to http://www.apta.org/Payment/Medicare/Advantage/
Also, do an Internet search for the May 2014 issue of PT in Motion magazine. You can download it if you’re an APTA member, and there is a good article on Advantage plans.
I would also add here, that if you have patients who have retired from a federal government job and have “Blue Cross/Blue Shield Federal” insurance (rather than Medicare Part B), you should call BCBS directly and make sure it would be okay to provide covered services to this beneficiary on a private-pay basis. Federal BCBS does include coverage for outpatient physical therapy.
It’s been that way for as long as I’ve been practicing since 1995. Currently do some contract work for a large corp and the Medicare Advantage people don’t fall under the Medicare guidelines and is the sole reason they don’t accept Medicare but will take Advantage.
I am currently enrolled as a Medicare provider, as well as with other insurance companies, but want to go cash based with my own practice. Do I have to “voluntarily terminate” my enrollment with insurances prior to going cash based? Or do I stay a provider with them in order for patients to submit invoices for reimbursement? The only thing I see on the CMS website is the 855-I form, which allows one to either opt out (which isn’t the case for PT’s), or voluntarily terminate enrollment. In my practice, I am not going to be working with Medicare patients at all anyway. Any thoughts or guidance on this? Thanks!
In order to be taken out of the MC system, yes you need to terminate your enrollment. If you want to be out of network / cash -based, you’ll need to do the same with the private insurances as well … they usually have a contractual mandate that you bill them directly for any services provided to their insureds, so you’ll have to end those contracts to get out from having to deal with them and directly bill them for your services.
We are a provider’s office looking to become a non-par provider after being a par provider for 14 years. We are reimbursed as a group, so all of our clinicians are under our status. I can not find anything clearly explaining the process of how to change our status and if we need to complete this process for all of our employees. I’ve contacted Medicare and they just tell me I have to wait for the open enrollment period but no instructions on what to do then. I’ve also contacted the APTA, and apparently I know more than they do which is a little frustrating being we pay a large membership fee and no one can answer my questions. Any guidance?
Hey Robin,
unfortunately, I also only know that this can be done during the open enrollment period. I’ve looked into this exact question on behalf of others, and only received the same response as you… No details of what occurs in the process. I believe that enrollment period is coming up soon, so as you guys go through the process, if you think about it, please return and give us an update here on what it entails. So sorry I can’t give more clarity on this one.
Jarod
I am a private cash based practice and I am enrolled but non-participating with Medicare. While everything says it’s legal to charge 115% of what the Medicare fee schedule states per CPT code, the reality is that Medicare doesn’t allow me to do that. When I use the APTA fee calculator and then charge 115% of that and submit a claim Medicare sends EOBs back to my patients stating that “under federal law I can not charge more then *** depends on the code and it NOT 115%. My private clients pay me $160/one hour sessions and the most I can charge Medicare patients is $124ish (I charge $120 for simplicity sake), so I am loosing $40 per Medicare client. I am really struggling with whether or not to continue to take Medicare clients b/c they often “fill in gaps where $160 clients are not scheduling BUT they also sometimes take the appointments that I could have given to $160 clients. If it wasn’t for the special place in heart that I have for older adults and the fact that I hope to be able to receive quality care when it is my turn for Medicare (karma!), then I would most likely say that I do not except Medicare patients with out batting an eye. The strategy I recently employed is to not let them schedule too far in advance and have them take essentially what is left on my schedule but that feels unethical or discriminatory to me, which might even be illegal, who knows?? Any thoughts?
If you are a Non-Participating provider, providing covered services and collecting payment from beneficiaries at the time of service, the maximum amount you may charge is 115% of the approved fee schedule amount for Non-Participating providers; which is 95% of the normal Medicare Physician Fee Schedule (MPFS). This is called the “limiting charge.” This amounts to 9.25% more than the normal MPFS (115% x 95%). So, you may charge and collect 109.25% of the MPFS. A simple example would be as follows: if the services you provided would have added up to a $100 bill sent to Medicare following the normal MPFS for those services, you could collect $109.25 directly from the beneficiary at the time of service. Reminder: you still have to send the claim to Medicare, but they will then provide any applicable reimbursement directly to the beneficiary.
So, if you are charging 115% of the normal MPFS, then yes you are charging more than allowed.
To find out the MPFS and Limiting Charges (in your area) for the specific procedures you provide, you can perform those searches here:
https://www.cms.gov/apps/physician-fee-schedule/overview.aspx
To accurately find your limiting charges, once you’ve entered a search for a procedure code, you will need to identify your “carrier locality.” You can download a zip file that contains an excel file with those localities at this webpage: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/Locality.html
Please Note: Some states are actually stricter than Medicare and lower the “limiting charge” a Non-Participating provider can bill Medicare patients, so you should search to see if this is the case in your state. I believe you can reach out to your State’s “State Health Insurance Assistance Program,” to check on this. Here is a directory:
http://www.seniorsresourceguide.com/directories/National/SHIP/
Can’t really comment on the legalities/ethics of the scheduling dilemma you mention above.
Heather, I am considering shifting to becoming a non par provider with MC. I would collect up front and my billing company would submit the claim to MC. In this arrangement, how does the secondary insurance get billed?
I’m seeking to start a home based occupational therapy practice providing a full range of OT services, including in-home assessments and interventions to help adults age in place. Since I imagine a majority of my clients would be over 65, it sounds like I have NO OPTION but to become a non par provider. I would very much LOVE to avoid the hassle of dealing w/Medicare, but without specializing in a way that isn’t traditionally covered by Medicare (wellness, dementia, etc) am I right in thinking I must become a non par provider? I’m hoping to start out part-time while I keep my day job, so dealing with the paperwork isn’t where I want to spend my energy. Any insights? Thanks!
I know this article is old but I am wondering of any changes. Recently, I have opened my own Behavioral health private practice and this article opened my eyes. I’ been feeling out applications to be considered a non-participant provider for several insurances. As a result of this article, I began the process for CMS and have found the answer for Par or no Par is automatically answered for me, I can not change the answer.
Is it now a requirement to engage in servicing Medicare clients?
CMS cannot “force” anyone to enroll in their system. I would reach out to them to figure out how to change the application to select your preferred relationship with them.
Are non-par Medicare providers REQUIRED to file a claim to medicare?
Yes. The mandatory claims submission rule states you must file a claim to Medicare for any covered services provided to a medicare beneficiary…unless in the rare case the beneficiary invokes their right to not have bills or PHI sent to Medicare. If you’d like more details on this and hundred of other components of this tricky but vital topic, you can check out my full e-book here: drjarodcarter.com/medicare
Can I participate with Medicare in one location and then open my own non par home car business?