I’m getting emails from therapists nationwide, reporting their provider contracts with certain health plans have been terminated  without warning because the clinician had opted out of Medicare.  Others are being told if they do opt out of Medicare, they’d be booted off the network.

Susan Frager, Medicare expert/diva and owner of PsychBillingCoach.com, is hearing the same thing.  “This is happening with Kaiser Permanente, Tricare, Carelon (formerly Beacon), Horizon BCBS of New Jersey, some Aetna plans, and other plans, some who have stated openly, ‘if you’re going to contract with us, you must not opt out of Original Medicare.’”  [Note: Some of these plans (like Aetna) may require this from providers in some regions, but not in others.]

Note that these plans aren’t usually saying that you must ENROLL as a Medicare provider, only that you can’t “opt out.”  Huh?  Stay with me here.

There are two ways to provide services to Medicare clients.  The first way would be if you enroll as an Original Medicare provider, and bill Original Medicare for clients with that plan.  The second way is to see a Medicare client whose Medicare plan is administered through a private health plan like Kaiser, Blue Cross, or Aetna.  These plans are called Medicare Advantage plans.

When you officially Opt-out of Medicare, you submit an Opt-Out Affidavit to Medicare declaring that you will not bill Medicare for any services provided to any Medicare or Medicare Advantage clients.  Then if you have Medicare clients who are paying you privately, you must have them sign a Medicare Private Contract (to find out more on these two steps, read my Medicare Information Webpage here).  If you don’t take these two steps, Medicare may force you to refund their members who pay you privately.

But private health plans that serve Medicare Advantage clients don’t want you to opt out.  They’re saying, “you don’t need to ENROLL as a provider in Original Medicare, but you CAN’T opt out because we want you to be able to see our Medicare Advantage clients.”

So, can you see Medicare Advantage clients even if you’re not enrolled as a Medicare provider?   Well, “it’s an open question as to whether Medicare Advantage can legally pay a clinician who is not enrolled in Original Medicare. says Frager.  “Plans  are doing it, but after reading the statute (42 CFR 422.222), I’m unclear as to whether they should be. And this puts you at risk if they decide to take back money they paid to you.”

Then, should you take Medicare Advantage clients?  “I’d advise against taking Medicare Advantage clients if you’re not enrolled in Original Medicare,” warns Frager. “It seems like a clawback excuse waiting to happen.”  So, if you want to see Medicare clients, it might be safer to consider enrolling with Original Medicare as a Medicare provider.

But, back to our original question about kicking you off the panel if you opted-out of Medicare.  Can they do this?  “I know of no federal statute forbidding a private insurer from dropping a clinician from a panel based on their decision to opt out of Medicare,” says Frager.   “This means that until the federal government passes a law, or unless there is a state law that applies, the health plans can pretty much set the terms of their contracts.”

The same goes for Tricare.  “Tricare is a federal government program, and also has the right to stipulate that the provider must take Medicare in order to bill Tricare, says Frager.”  But she questions whether the government understands the effect of this requirement.  Says Frager, “let’s say you specialize in working with children from military families.  You opt out of Medicare because you don’t feel you have adequate training to work with older adults.  By  removing you from the panel if you opt out of Medicare, the government is depriving military families of your expertise.”

This trend can also be seen over at Grow Therapy, a nationwide platform that connects providers and clients.  “While Medicare enrollment is optional…because the insurance companies we partner with often work with Medicare, they don’t allow providers to be on the Medicare Opt-Out list. Therefore, we can’t allow it either,” said a Grow Therapy representative.  (Update August 2026: Providers from another billing platform, Rula, told me that they received notice that they would no longer be able to participate in Rula if they had opted-out.  I have yet to confirm this…)

Why are they doing this?  Frager says health plans are using their considerable power to force you not to opt out of Medicare because their Medicare Advantage networks are inadequate to care for the huge number of Medicare clients.  “There are published network adequacy standards that Advantage plans have to meet.  Rather than do the things they need to do to attract more network clinicians, they’re instead adopting this approach,” she says. “I seriously doubt that the government is even aware of this unintended consequence [the loss of needed clinicians] in their attempt to improve access for Medicare beneficiaries,” says Frager.

So, what can you do if you’ve been dis-enrolled, or are facing potential disenrollment, due to a decision not to accept Medicare?  Here are 10 tips from Frager and me:

1. Read your provider contracts and check with all the health plans you work with (or intend to work with) to see if they require Medicare participation.  But phone reps aren’t always well trained.  Frager advises, “get the answer in writing from a provider network contracting representative or manager.”   Keep in mind that some plans only want to be notified if you opt out, but will not terminate your contract.
2. Seek legal counsel if you feel you have been unfairly terminated.  Your professional association and malpractice carrier may provide free access to attorneys.
3. Contact the health plan and find out how to appeal your termination. 
4. If you recently opted out of Medicare, you have 90 days to rescind that opt-out, if you want to change your mind and enroll in Medicare.
5. If you are terminated, notify affected clients as soon as possible.   “Your client can file a complaint with the health plan that might actually get results,” says Frager.
6. If a complaint to the health plan is unsuccessful, suggest the client try filing a complaint with their employer, their state’s Insurance Commissioner, Department of Insurance, Department of Managed Care, or the U.S. Department of Labor, says Frager.  “Entities that can penalize insurers are much more powerful than either you or your clients.”
7. Contact your professional association.
8. Spread the word on therapist online groups.
9. Tell your story to advocacy groups like the National Alliance on Mental Illness (NAMI) or Mental Health America (MHA), who represent your clients and have larger reach.
10. Contact your legislators. “If the powers that be aren’t made aware of what the payers are doing, then nothing will change,” says Frager.

To discuss your situation, schedule a one-on-one consultation with Medicare expert Susan Frager at www.psychbillingcoach.com.