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  • Physicians have three ways to participate in Medicare:

    • Sign a participation (PAR) agreement.
    • Elect nonparticipation (nonPAR).
    • Become a private contracting physician (opt out).

    Participating (PAR)

    Participating in the Medicare program simply means you agree to accept assignment for all services furnished to Medicare patients. By accepting assignment, you agree to accept the Medicare-approved amount as total payment for covered services.

    • The deductible and coinsurance are applied to covered services. The beneficiary is responsible for these amounts.
    • If both Medicare and Medicaid cover a beneficiary, the Medicaid program assumes responsibility for these amounts.

    When you enroll as a new provider, or reenroll due to a tax identification number change, you start as a nonparticipating provider. You are not considered participating unless you submit the CMS-460 form to your MAC/carrier.

    • To become a participating provider at the time of enrollment, you have to change your participation status. You must do so within 90 days of the date of your Provider Transaction Access Number notification.
    • If CMS receives a PAR agreement within 90 days of your enrollment, it will use the postmark date on the envelope as your PAR effective date.
    • If you decide to enroll as a Medicare participating provider after the 90-day grace period, you must wait. Complete your form during open enrollment.

    Once a participant, you must remain a participant until the following annual enrollment period.

    Nonparticipating (NonPAR)

    If you choose not to participate in the Medicare program, you may choose either to accept or not accept assignment on Medicare claims on a claim-by-claim basis. If you choose not to accept assignment:

    • You may not charge the beneficiary more than the Medicare limiting charge for unassigned claims for Medicare services.
    • Physicians must collect payment directly from the beneficiary who is responsible for submitting their claim to Medicare for the allowable.
    • The limiting charge applies. The limiting charge is 115 percent of the Physician Fee Schedule amount. The beneficiary is not responsible for billed amounts in excess of the limiting charge for a covered service. The limiting charge applies to all services and supplies billed under the physician fee schedule — including drugs and biologicals — regardless of the provider rendering the services.
    • Be sure never to charge patients more than the limiting charge amount. Physicians who do charge more will be subject to a civil monetary penalty if they willfully, knowingly or repeatedly charge a higher amount. The penalty may be up to $10,000 per violation, as well as three times the amount of the charges claimed per violation. The physician may also be excluded from the Medicare program for five years. 

    CMS provides instructions for patients on how to file a claim/claim form [PDF].

    Changing Your Participation Status

    To change your participation status from nonPAR to PAR, you must submit the CMS-460 form signed by the provider or authorized official of the National Provider Identifier requesting the change.

    To change your participation status from PAR to nonPAR for the upcoming year, you must submit a letter on a provider letterhead to your local Medicare contractor stating your intent, postmarked by Dec. 31 of the current year. The letter should include all of the following:

    • Provider Transaction Access Number
    • National Provider Identifier
    • Tax identification number/Employer Identification Number/Social Security number

    The request should be signed by the provider or an authorized official for the National Provider Identifier requesting the change.

    If you’re considering a change in status from PAR to Non-PAR, you should first confirm whether you have any contractual arrangements with hospitals, health plans or other entities that require you to be a PAR physician.

    Opting Out of Medicare

    Physicians and practitioners who do not wish to enroll in the Medicare program may “opt out” of Medicare. When you opt out:

    • Neither the physician nor the beneficiary submits the bill to Medicare for services rendered.
    • The beneficiary pays the physician out of pocket.
    • Neither party is reimbursed by Medicare.

    Once you have opted out of Medicare, you cannot submit claims to Medicare for any of your patients for a two-year period. In order to opt out:

    1. You and the beneficiary must sign a private contract that states that neither of you can receive payment from Medicare for the services performed; and
    2. You must submit an affidavit to Medicare expressing your decision to opt out of the program.

    Medicare Contractor Opt-Out Affidavits