So like me, you pay into Medicare for 40+ years, only to find once enrolled that an increasing number of physicians have “opted out” of Medicare. And more and more often Medicare beneficiaries are finding that their long time physicians don’t accept Medicare and either have to switch doctors or pay their trusted doctors out-of-pocket.
It is easy to find articles encouraging doctors to stay out of Medicare. Here’s an interesting quote: “Medicare beneficiaries would likely be shocked to learn that Medicare contractor employees, who have only a high school education and no medical training, sit in judgment over physicians as to what is and is not medically necessary for Medicare patients. It is a strategy designed to save costs for the Medicare program.” (A)
Lost in the discussion is the fact that Medicare reimburses hospital for the training of residents who are paid during their period of training.
We are legally obligated to pay into Medicare, but it is fairly simple, without penalty, for a physician to opt-out.
It is possible for a physician to finish Medicare subsidized training and immediately opt-out. Or opt-out anytime thereafter.
So if physicians opt out of Medicare maybe they should have to reimburse Medicare accordingly, since we, the patients, paid for their training through the Medicare payroll tax.
“Medicare Direct Graduate Medical Education (DGME) Payments
Clinical settings are key sites for the education of future physicians. Typically, teaching hospitals and associated ambulatory settings provide such an educational environment for the training of resident physicians (“residents”). Residents have graduated from medical school and then go on to complete several years of supervised, hands-on training in a particular area of expertise, such as primary care or surgery. This phase of their training is called “graduate medical education” (GME).
Hospitals that train residents incur real and significant costs beyond those customarily associated with providing patient care. The Medicare program makes explicit payments to teaching hospitals for a portion of these added costs through direct graduate medical education (DGME) payments.
Purpose of the DGME Payment
The DGME payment compensates teaching hospitals for “Medicare’s share” of the costs directly related to the training of residents…The added direct costs of GME incurred by teaching hospitals include: stipends and fringe benefits of residents; salaries and fringe benefits of faculty who supervise the residents; other direct costs; and allocated institutional overhead costs, such as maintenance and electricity. Other direct costs include, for example, the cost of clerical personnel who work exclusively in the GME administrative office…” (B)
Is your doctor participating, non-participating, or opted-out?
“A doctor who takes Medicare assignment agrees to accept the Medicare-approved amount as full payment. In general, there are three categories of Original Medicare doctors:
Participating doctors are doctors who accept Medicare and always take assignment. Participating doctors are required to submit a bill (medical claim) to Medicare for care you receive. Medicare will process the bill and pay your doctor directly for care that he/she provided to you.
If you see a participating doctor, you are only responsible for paying a 20% coinsurance for Medicare-covered services. Most doctors who treat patients with Medicare are participating doctors.
Non-participating doctors are doctors who don’t routinely take assignment. Like participating doctors, non-participating doctors are required to submit a bill (medical claim) to Medicare for care you receive. However, you generally need to pay non-participating doctors directly for the full cost of care you receive. Medicare will process the bill and reimburse you directly for Medicare’s share of the cost of care you receive (generally 80% of Medicare’s approved amount for most medical services).
If you see a non-participating doctor, you may pay up to 15% of the Medicare-approved amount for non-participating providers, on top of a 20% coinsurance for care you receive. This extra 15% is called the limiting charge….
Opt-out doctors are doctors who have formally opted out of the Medicare program. Opt-out doctors can charge their Medicare patients whatever they want. These doctors do not submit any bill (medical claims) to Medicare and are not subject to the Medicare law that limits the amount doctors may charge patients.
If you see an opt-out doctor, you pay the entire cost of your care (except in emergencies). The doctor should have you sign a private contract that states that you understand you are responsible for the full cost of the services. Medicare will not pay for any of the cost of services you receive from an opt-out doctor.” (C)
It is easy for a physician to opt-out.
Opting Out of Medicare: A Guide for Physicians, https://aapsonline.org/opting-out-of-medicare-a-guide-for-physicians/
(A) Opting Out of Medicare, by Lawrence R. Huntoon, http://www.jpands.org/vol21no1/huntoon2.pdf
(B) Medicare Direct Graduate Medical Education (DGME) Payments, https://www.aamc.org/advocacy/gme/71152/gme_gme0001.html
(C) Paying for the doctor when you have Original Medicare, https://www.medicareinteractive.org/get-answers/medicare-covered-services/doctor-services-part-b/paying-for-the-doctor-when-you-have-original-medicare