Ensure an Easy Transition to Medicare

Medicare can simplify health insurance costs and decisions if you’re age 65 or older as long as your preferred health care providers are part of the program.

Happy female doctor checking an older male patient's blood pressure

by NEA Member Benefits

Aug 27, 2021

Key takeaways

  • Doctors can choose to accept Medicare payments in full, in part, or elect to opt out of the program.
  • The vast majority of primary care physicians continue to accept Medicare for all covered services.
  • Medicare acceptance rates may be somewhat lower in wealthy urban areas.
  • If your doctor does not accept Medicare, you can pay out of pocket or look for a new physician.

Even though Baby Boomers are notorious for refusing to age, more and more of them are looking forward to turning 65 so they can move to Medicare for their primary health coverage. That’s because Medicare premiums generally are less expensive than private health insurance. Plus, if you opt for prescription drug coverage and Medicare Supplement policy, you may have zero out-of-pocket expense when you visit your doctor or the hospital.

Even still, participation rate in the program isn’t quite as universal as it once was – partly because Medicare pays lower provider reimbursement rates than private insurance, and also because it requires doctors to jump through lots of administrative hoops. But overall, it’s not difficult to find doctors who accept Medicare.

3 categories of doctor participation in Medicare

There are three ways doctors work with Medicare:

1. Accept assignment. This means a doctor agrees to accept Medicare-approved reimbursements as payment-in-full for all covered services. This is what most people want from their doctors.
2. Non-participating. This is a bit of a misnomer because these doctors do accept Medicare payments but they don’t necessarily accept it as full payment. If a non-participating doctor charges you $200 and Medicare allows $150 for the service, you will have to pay the $50 difference plus any copays. Even if you pay the full cost upfront, the provider should still submit a bill to Medicare, and you will receive a reimbursement for 80% of the approved amount.
3. Opt-out. Doctors who opt out don’t submit any bills to Medicare. You are responsible for paying the entire cost of services.

How many doctors accept Medicare?

A 2020 study by the Henry J. Kaiser Family Foundations found that only 1% of non-pediatric physicians have opted out of Medicare, with psychiatrists representing two-fifths of that number. An earlier KFF study in 2015 found that more than 9 in 10 non-pediatric primary care physicians accept Medicare—about the same percentage as those who accept private insurance.

There may be pockets of the country—primarily in wealthier urban areas—where it’s a little more difficult to find doctors who accept Medicare. For example, New York City had a 76% “accept assignment” rate for Medicare beneficiaries in 2017, while Fargo, North Dakota had a 100% acceptance rate, according to Merritt Hawkins, a physician search firm.

Rather than opt out of Medicare, some doctors simply cap the number of Medicare patients they are treating, effectively limiting access for new Medicare beneficiaries. In a 2016 survey, the Texas Medical Association found that 35% of its members were not accepting new Medicare patients, up from 22% in 2000.

Similarly, the growth of concierge medicine—in which a practice requires an upfront fee to retain its services—has also crimped Medicare acceptance. Again, though, this is a phenomenon primarily in wealthy urban areas.

Tips to transition easily from regular health insurance to Medicare coverage

To avoid any opt-out surprises, ask your current physicians if they plan to continue accepting Medicare. If the answer is “no,” start your search for new doctors before you turn 65 so the transition will be smoother when you switch to Medicare coverage.

  • Check the Physician Compare Directory on medicare.gov. You can search for Medicare doctors by ZIP code. It’s a good idea to call doctor candidates to confirm they’re still on board with the program.
  • Ask for referrals. Ask your trusted doctors for names of other physicians who may accept Medicare.
  • Negotiate lower fees. If you just can’t leave your opt-out doctor, ask for discounts for prompt cash payments. Many doctors will lower fees if they know you have to pay out-of-pocket.
  • Consider urgent care or clinics for routine medical issues. Most clinics accept Medicare, but check the ones in your area in advance to be sure.
  • Pay for a concierge. Medical practices with a concierge model appeal primarily to wealthier patients who don’t want to feel like they are part of a large-volume practice in which doctor-patient time is limited.

Understand your options and be proactive

The vast majority of seniors heading into the Medicare system will find it a seamless transition with their current health care providers. If you are among the few who must search for new doctors, with a little bit of pre-planning you should be able to build trusted relationships with good doctors before you get your Medicare card.

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