February 14 is the  day that The CMS (Centers for Medicare and Medicaid Services) designated as the deadline to for doctors to drop out of Medicare participation.  Customarily, doctors had to decide on becoming a nonparticipating physician by the end of the year.

One thing to recognize, however, is that eliminating the participation in the Medicare program is not about the money. In fact, Medicare reimbursement for services rendered is 95% of what the participating physician would receive.  That is 95% of the fee schedule, not 95% of the office billed amount (which can be 70-80% of what a physician would normally bill).

So why would doctors want to discontinue Medicare participation?  There are several reasons why this may seem like an attractive decision.  First, the formula which regulates the rate of fees has not been altered and the government has failed to address this problem.  For the last two years, doctors have lived with a guillotine over their heads- a threat that reimbursement would be slashed by as much as 23%.  When an office depends on the majority of income from Medicare, the decrease would be devastating in terms of meeting expenses.  Secondly, doctors could recommend treatment options that they feel are in the patient’s best interest without having their hands tied by governmental regulations.   Thirdly, the relationship between doctor and patient changes. The doctor can afford to spend more time with the patient without living within the confines that insurance participation imposes.

The American Medical Association now provides a medicare participation calculator to assist in figuring out what the effect would be on gross and net incomes from the shift in Medicare reimbursement.

The problem with prolonging the life expectancy of the Medicare program itself is that while it may still be viable, there may not be many physicians to choose from on the plan.