Page 29 - Medicare Benefit Policy Manual

physician/practitioner opted out of Medicare, then Medicare payment may be made to the
beneficiary for the non-emergency and/or non-urgent care services (assuming that the
services would otherwise be payable). On the other hand, if the beneficiary did enter into
a private contract with the physician/practitioner for the services or received services
from the physician/practitioner 15 days after the date of a notice by the A/B MAC (B)
that the physician/practitioner has opted out of Medicare, then no Medicare payment may
be made. Moreover, the A/B MAC (B) must follow the procedures outlined in §40.11 for
cases in which the physician/practitioner fails to maintain opt-out. If the
physician/practitioner does not respond to the Medicare A/B MAC (B)’s request for a
copy of the private contract within 45 days, the A/B MAC (B) must make payment to the
beneficiary based upon the payment for a nonparticipating physician/practitioner for that
service. It must notify the beneficiary that the physician/practitioner who has opted out
must privately contract with the beneficiary or the beneficiary’s legal representative for
services the physician/practitioner furnished and that no further payment will be made to
the beneficiary for services furnished by the opt-out physician/practitioner after 15 days
from the postmark of the notice.

40.7 - Definition of a Private Contract
(Rev. 1, 10-01-03)
B3-3044.7

A “private contract” is a contract between a Medicare beneficiary and a physician or
other practitioner who has opted out of Medicare for two years for all covered items and
services the physician/practitioner furnishes to Medicare beneficiaries. In a private
contract, the Medicare beneficiary agrees to give up Medicare payment for services
furnished by the physician/practitioner and to pay the physician/practitioner without
regard to any limits that would otherwise apply to what the physician/practitioner could
charge. Pursuant to the statute, once a physician/practitioner files an affidavit notifying
the A/B MAC (B) that the he/she has opted out of Medicare, the physician/practitioner is
out of Medicare for two years from the date the affidavit is signed (unless the opt-out is
terminated early according to §40.35, or unless the he/she fails to maintain opt-out (See
§40.11)). After those two years are over, a physician/practitioner could elect to return to
Medicare or to opt out again. A beneficiary who signs a private contract with a
physician/practitioner is not precluded from receiving services from other physicians and
practitioners who have not opted out of Medicare.

Physicians or practitioners who provide services to Medicare beneficiaries enrolled in the
new Medical Savings Account (MSA) demonstration created by the BBA of 1997 are not
required to enter into a private contract with those beneficiaries and to opt out of
Medicare under §1802 of the Act.

40.8 - Requirements of a Private Contract
(Rev. 222, Issued: 05-13-16, Effective: 08-15-16, Implementation; 08-15-16)

A private contract under this section must: