From November 2005 to April 2006, about 1 million Medicare beneficiaries
enrolled in Medicare Advantage (MA) managed care plans (Medicare Part C),
according to the Centers for Medicare and Medicaid Services (CMS), bringing
the total number of enrollees to about 6 million. With more and more patients
switching from fee-for-service Medicare Part B to Medicare Advantage plans, a
new payment problem may occur for physicians.
The problem arises from CMS's retroactive enrollment policy for the MA
plans. Although a patient may not enroll in the MA until the middle of the
month, under the capitated payment arrangement, Medicare pays the plan for
that patient from the first day of that month. This means that if you see a
patient on August 5 and the patient signs up for an MA plan on August 22, the
patient is considered a member of the MA plan for the entire month. Thus,
reimbursement for your services must come from the patient's MA plan, not your
In some cases, the Part B carrier pays a claim for such a patient if the
claim is filed before Medicare changes the patient's status in its database.
When the error is discovered, however, the carrier sends a letter to the
physician demanding return of the payment since the patient was covered by the
MA plan at the time of service.
If this happens to you, you must return the payment to the carrier as
requested and immediately bill the patient's MA plan. The repayment letter you
receive from the carrier should provide the name of the MA plan that covers
the patient and information on how to contact the plan for reimbursement. The
CMS Web site has the addresses and billing information for all participating
MA plans posted at<www.cms.hhs.gov/HealthPlansGenInfo/claims_processing_20060120.asp#TopofPage>.
If you participate in the MA plan's network, you will be paid the amount
specified in your contract. If you do not participate in the network, CMS says
your payment from the plan should be the same amount that you would have
received from your Medicare Part B carrier.
In most cases, physicians whose patients switch to an MA plan are unaware
that they no longer have fee-for-service Medicare Part B. Thus, APA's Office
of Healthcare Systems and Financing recommends that you ask your patients at
each visit if they have switched to a new plan. It used to be that you needed
to ask only your privately insured patients, but now it is equally important
to ask your Medicare patients as well. ▪