Psychiatr News January 5, 2007
Volume 42, Number 1, page 13
© 2007 American Psychiatric Association
Psychiatric Practice & Managed Care
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Beware of Medicare Snare As Patients Reach 65
Don't panic: you can make things right with Medicare.
Even if you have carefully avoided having any relationship with the
Medicare program, you may encounter problems when your patients age into the
Medicare program if you haven't taken the step of officially opting out. (For
information about opting out of Medicare, see below; PP&MC in the November
3, 2006, and December 3, 2004, issues; or APA's Web site at
<www.psych.org/members/practpsych/optingoutofmedicare112701.cfm>.)
Although you've made it a policy not to take Medicare, one day you realize
that several of your patients have turned 65, a couple of them several months
ago, and there's a high probability that their health care is now covered by
Medicare. These patients have always paid your standard fee out of pocket and
have continued to do so.
The problem is, if you see a Medicare patient and haven't taken the step
of formally opting out of the Medicare program, you are legally obligated to
file a claim with Medicare and may not charge more than the Medicare-approved
fee for the service provided.
At the point that you realize you've been seeing a Medicare beneficiary but
you haven't been filing claims with Medicare, there are two choices. First, if
you know you never want to have anything to do with Medicare, you can refund
the payments your patients have given you since they became Medicare
enrollees, opt out of Medicare, and sign private contracts with these
patients; they can then resume paying your fee as they had been.
The second option—to enroll in Medicare as a nonparticipating
provider—applies if you want to continue seeing your Medicare patients
and don't want to lose the entire amount they've paid you since they enrolled
in Medicare. you will have to refund only the portion of your fee that was
beyond the Medicare-allowed amount for the treatment you provided; you must
then file claims with Medicare for services provided as far back as two years
and four months, and Medicare will reimburse the patient. There is no issue
with your not having been enrolled in Medicare when the care was provided.
Enrolling in Medicare is a little easier than it used to be. if you have
not yet done so, you can begin by getting a National Provider identifier (see
article below). Then obtain and complete the Medicare enrollment form,
CMS-855I; it can be downloaded from
<www.cms.hhs.gov/cmsforms/downloads/cms855i.pdf>
or requested by phone at (800) 465-3203. Finally, since Medicare reimburses
physicians only by electronic transfer, you also must complete CMS-588, posted
at
<www.cms.hhs.gov/cmsforms/downloads/CMS588.pdf>.
If you don't want to opt out of Medicare or enroll in Medicare so you can
file claims, you must refund your patients' payments and tell them that you
can no longer see them because you cannot provide services to Medicare
beneficiaries. Also, you have an obligation to help your patients find another
therapist before terminating the relationship.
If you do not see Medicare patients in your private practice but do see
them in clinic work, even though the clinic does the billing for your
services, you are enrolled in Medicare. Thus, you must file claims for the
services provided to patients you saw in your practice since they became
Medicare beneficiaries and refund the portion of their payments beyond the
Medicare-approved amount. you don't have to see Medicare patients in your
private practice even though you see them in other settings, but if you
inadvertently do see them, you must file claims with Medicare.
If you don't do any Medicare work at any location, are not enrolled in
Medicare, and don't want to enroll in Medicare, you have only one option when
patients age into Medicare without your having realized it: you must refund
the patients' payments, accept the loss, and continue to see these patients
only if you can afford to do it pro bono.
One might wonder why psychiatrists who do not want to treat Medicare
patients don't just take the step of opting out of Medicare. Here's the
reason: Since the opt-out period is two years, physicians who think their
practice or employment situation might change in that period might not want to
take the risk of being unable to see Medicare patients.
It's really not as complicated as it sounds, but the best way to avoid
having any problems with Medicare patients is to be sure and check with your
patients every time they come about any changes in their insurance status.
If you have questions or would like more information, call APA's
Managed Care Help Line at (800) 343-4671. 
Footnotes
APA OFFICE OF HEALTHCARE SYSTEMS AND FINANCING
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