AANEM News Express

AANEM News Express

Medicare Reductions: What Can You Do Legally?

Frustrated DoctorBy Shirlyn Adkins, JD, Executive Director

As the first Medicare checks of the New Year are arriving in physician practices, AANEM members are seeing the reality of the 2013 reimbursement changes, and they are raising many questions. Members are contacting the AANEM office asking, “Can we go on strike to protest these cuts? Can we boycott Medicare? Do I have to treat Medicare patients? What can we do?”

Can Physicians Boycott Medicare?

First, physicians cannot go on strike or boycott to protest Medicare payment rates. The Sherman Antitrust Act prohibits concerted activities that restrain trade or involves price fixing. Going on strike and boycotting are considered a restraint of trade. The Supreme Court long ago determined that learned professions like physicians are subject to the antitrust laws and that physicians cannot unionize or strike except to the extent that they are non-managerial employees; even then, they would only be able to collectively negotiate with their employers. In addition, associations such as the AANEM cannot tell their members to boycott or go on strike. In 1988, the Federal Trade Commission (FTC) charged the New York State Chiropractic Association with conspiring with its members to increase the level of reimbursement paid for chiropractic services by collectively threatening not to participate in a third-party payer insurance program. The FTC has issued numerous similar decisions since then.

Do You Have to Treat Medicare Patients?

If you are in private practice, no. If you are currently enrolled in Medicare as a “participating provider,” it means that you have chosen to accept the Medicare fee schedule rate as full reimbursement for all of your services and will not bill the patient for any additional amounts other than allowable copayments. You are free to close your practice to new Medicare patients, limit the number of Medicare patients you see, change your status to non-participating, or opt out of Medicare altogether. If you have a preexisting relationship with a Medicare patient and you choose to no longer see that patient, be sure to follow the legal and ethical guidelines for ending a patient relationship.

If you have enrolled in Medicare as a “non-participating provider,” you are able to choose on a claim-by-claim basis whether to accept Medicare assignment. If you accept assignment as a non-participating provider, you receive 95% of the Medicare fee schedule amount for the service you provide. If you choose not to accept the assignment, you still treat the patient but you can bill the patient directly for up to 115% of the fee schedule amount for non-participating providers (i.e., 115% of 95% of the full Medicare fee schedule amount, which comes to 109%). This is referred to as the limiting charge. The beneficiary is responsible for what Medicare does not pay. You must collect the full amount from the patient in this scenario. Medicare reimburses the patient, not you. Even though you bill the patient directly and the patient pays you, you must still submit a claim with Medicare. If you can collect the full limiting charge for more than 35% of these patients, your revenue will exceed the Medicare revenue of a participating physician. However, you need to factor in additional staff time for billing and collection efforts to determine if this option makes financial sense. Continue reading (only available for AANEM members)

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