Guidance from CMS on contracting privately to provide Medicare services

Eligible health care professionals, including psychologists, who have never enrolled in Medicare may privately contract to deliver services to beneficiaries without first having to become Medicare providers

By Government Relations Staff

January 28, 2010 — In response to a request from the American Psychological Association (APA), the Centers for Medicare and Medicaid Services (CMS) has clarified with all its contractors that eligible health care professionals, including psychologists, who have never enrolled in Medicare may privately contract to deliver services to beneficiaries without first having to become Medicare providers. 

Private contracting is an option for psychologists who do not want to become Medicare providers but are willing to furnish services to beneficiaries. Private contracting is also an option for psychologists who become Medicare providers but later wish to leave the program. Psychologists who opt out and privately contract must do so for all services provided to all Medicare beneficiaries; they cannot chose to opt out of Medicare for some beneficiaries but not others.

Under Medicare’s rules, enrollment as a Medicare provider is not a prerequisite for an eligible health care professional who wishes to privately contract with a beneficiary. Yet when contacted by APA staff for information on how psychologists could privately contract, some Medicare Administrative Contractors (MACs) indicated that a psychologist who was not a Medicare provider must first enroll in Medicare in order to then opt out and contract privately with beneficiaries. APA advised CMS of the apparent misinformation and asked the agency to communicate its policy on private contracting to all MACs to help ensure that psychologists seeking to initiate the process receive accurate information.
 
A psychologist may not receive any Medicare payments for services furnished to a Medicare beneficiary with whom the psychologist has privately contracted.  In turn, the beneficiary agrees to give up Medicare payment for services furnished by the psychologist and to pay the psychologist without regard to any limits that Medicare would otherwise apply to the charges. 

The January 7, 2010 CMS memorandum reminds the MACs that eligible health care professionals do not have to enroll in Medicare before they can opt out. Further, CMS clarifies that to enter into private contracts with Medicare beneficiaries the health care professional must file an affidavit with the MAC for their state in which they agree to not to file any Medicare claims for a period of two years and to meet certain other criteria.  Psychologists interested in privately contracting with Medicare beneficiaries should contact their MAC for information about the opting out process and the requirements involved in private contracting.

Questions about Medicare may be directed to the Government Relations Office for APA via e-mail or 202-336-5889.