Opting out of Medicare: the affidavit, the cycle, the private contracts

How does opting out of Medicare work?

Opting out means you file a sworn affidavit with your Medicare contractor stating that you will not bill Medicare, and instead see Medicare patients under a written private contract in which they agree to pay you directly. It is a deliberate, whole-practice decision, not something you toggle per patient. Your contractor publishes the affidavit, the enrollment workflow, and the operative instructions, and CMS publishes which contractor serves your jurisdiction 1Ref 1Centers for Medicare & Medicaid Services (2026).Medicare Administrative Contractors.That Medicare claims administration is regionalized across MACs and that CMS publishes which MAC serves each jurisdiction — the contractor a provider files an opt-out affidavit with and whose instructions govern the process.2Ref 2Novitas Solutions Medicare (2026).Novitas Solutions Medicare.That a Medicare Administrative Contractor publishes the enrollment workflows that bind providers in its states — including the opt-out affidavit, its effective-date and renewal instructions, and the guidance a provider follows to file and to build a compliant private contract..

Once you are opted out, Medicare no longer pays for your covered services and generally neither do you nor the patient submit a claim for them. The patient pays your private rate under the contract, and the usual Medicare limits on what you may charge do not apply to that private arrangement. It is the most complete separation from Medicare a clinician can choose short of not treating its beneficiaries at all.

Opting out is not the same as being non-participating

The three Medicare statuses are easy to conflate and mean very different things for payment. A participating provider accepts assignment and is paid directly by Medicare; a non-participating provider still bills Medicare but under different assignment and payment rules; an opted-out provider does neither and bills the patient privately. Only opt-out steps outside the physician fee schedule entirely 3Ref 3Centers for Medicare & Medicaid Services (2026).Physician Fee Schedule.That the Medicare Physician Fee Schedule sets payment for clinician services — the payment framework that participating and non-participating providers operate within and that opting out steps entirely outside of..

Because the difference is so consequential, it is worth reading the full comparison of participation, non-par, opt-out before assuming which one you want — many clinicians reaching for "opt out" actually want non-participating status, which keeps them inside Medicare on different terms. The two decisions also run on different clocks: the participating-versus-non-participating election has its own timing, covered separately under the December window, and is not the same as the opt-out cycle.

The affidavit and the renewing cycle

Opting out is executed through an opt-out affidavit filed with your Medicare contractor — a different instrument from the standard enrollment application, and pointing the opposite direction from the 855I most clinicians used to enroll. The affidavit takes effect for a fixed period and then renews automatically unless you cancel it within the window the rules allow 2Ref 2Novitas Solutions Medicare (2026).Novitas Solutions Medicare.That a Medicare Administrative Contractor publishes the enrollment workflows that bind providers in its states — including the opt-out affidavit, its effective-date and renewal instructions, and the guidance a provider follows to file and to build a compliant private contract..

The current term is two years, but treat that as a figure to confirm rather than memorize: the operative term and the filing deadlines are stated on the affidavit your contractor publishes, and those instructions are the authority — not a summary you read elsewhere 1Ref 1Centers for Medicare & Medicaid Services (2026).Medicare Administrative Contractors.That Medicare claims administration is regionalized across MACs and that CMS publishes which MAC serves each jurisdiction — the contractor a provider files an opt-out affidavit with and whose instructions govern the process.2Ref 2Novitas Solutions Medicare (2026).Novitas Solutions Medicare.That a Medicare Administrative Contractor publishes the enrollment workflows that bind providers in its states — including the opt-out affidavit, its effective-date and renewal instructions, and the guidance a provider follows to file and to build a compliant private contract.. Before you file, pull your contractor's current opt-out affidavit and read the effective-date and renewal language directly, because getting the timing wrong is the most common opt-out error.

The private contracts with your patients

The other half of opting out is the private contract you sign with each Medicare patient you treat. In it, the patient agrees to pay you directly, acknowledges that Medicare will not reimburse the service, and accepts that the usual Medicare payment protections don't apply to the arrangement. The contract has to be signed before you provide the service, not after.

CMS's opt-out rules set the specific elements a compliant private contract must contain, and your contractor's opt-out guidance points to the current requirements — use those rather than a generic template, since a contract missing a required element can undo the protection it is supposed to provide 2Ref 2Novitas Solutions Medicare (2026).Novitas Solutions Medicare.That a Medicare Administrative Contractor publishes the enrollment workflows that bind providers in its states — including the opt-out affidavit, its effective-date and renewal instructions, and the guidance a provider follows to file and to build a compliant private contract.. Narrow exceptions to the private-contract requirement exist, such as emergency or urgent care for a beneficiary you have not privately contracted with; the exact conditions live in CMS's opt-out rules your contractor applies, so confirm them there before relying on one.

What opting out does and doesn't lift

Opting out removes you from the Medicare fee schedule for your covered services 3Ref 3Centers for Medicare & Medicaid Services (2026).Physician Fee Schedule.That the Medicare Physician Fee Schedule sets payment for clinician services — the payment framework that participating and non-participating providers operate within and that opting out steps entirely outside of., but it does not exempt you from your other obligations, and clinicians overestimate how much it simplifies. A genuinely uninsured or self-pay patient is still owed a good-faith estimate under the No Surprises Act, whether or not you participate in Medicare 4Ref 4Centers for Medicare & Medicaid Services (2026).No Surprise Billing.That the No Surprises Act requires good-faith estimates for uninsured and self-pay patients, an obligation that continues regardless of a provider's Medicare participation or opt-out status. As of July 2026.. Your NPI and provider taxonomy also remain your identity in the system and don't disappear because you opted out 5Ref 5National Uniform Claim Committee (2026).Health Care Provider Taxonomy Code Set.That provider taxonomy codes classifying provider type are maintained by NUCC and selected at NPI enrollment — a provider's NPI-and-taxonomy identity that persists and does not change because the provider opts out of Medicare. — the relationship between your NPI and your Medicare PTAN vs NPI is its own topic.

The honest summary is that opt-out changes who pays you and under what contract, not whether you are still a regulated healthcare provider. Records, privacy, licensure, estimates, and consent obligations all continue. What ends is Medicare reimbursement and the Medicare charge limits on your covered services — nothing more, nothing less.

Who tends to consider opting out

Opt-out fits a specific kind of practice, and the fit question matters more than the mechanics. Cash or private-pay practices that don't want to bill any insurer are the classic case. A newer group is now weighing it for the first time: marriage-and-family therapists and mental-health counselors, who became eligible to enroll and bill Medicare, and who now face the same participation-or-opt-out choice everyone else did 6Ref 6Centers for Medicare & Medicaid Services (2025).Medicare and Mental Health Coverage.That marriage-and-family therapists and mental-health counselors became eligible to enroll and bill Medicare — the newly eligible clinicians who now face the participation-or-opt-out choice..

The decision turns on your patient mix. If most of the people you serve are — or will be — Medicare beneficiaries who rely on the benefit, opting out cuts you off from billing Medicare for all of them and shifts the full cost onto the patient under a private contract. If your patients are predominantly private-pay by choice and can meet your rates, opt-out removes a large administrative burden. Run that against who actually sits in your waiting room before you decide.

Before you file

If you are leaning toward opting out, a short sequence keeps the timing and the paperwork correct. Each step points back to the authority that governs it, so you are never relying on a secondhand version of the rule.

• Confirm which Medicare contractor serves your jurisdiction, then pull its current opt-out affidavit and instructions 1Ref 1Centers for Medicare & Medicaid Services (2026).Medicare Administrative Contractors.That Medicare claims administration is regionalized across MACs and that CMS publishes which MAC serves each jurisdiction — the contractor a provider files an opt-out affidavit with and whose instructions govern the process.2Ref 2Novitas Solutions Medicare (2026).Novitas Solutions Medicare.That a Medicare Administrative Contractor publishes the enrollment workflows that bind providers in its states — including the opt-out affidavit, its effective-date and renewal instructions, and the guidance a provider follows to file and to build a compliant private contract..
• Read the effective-date, term, and renewal-window language on the affidavit itself, rather than trusting a remembered figure 2Ref 2Novitas Solutions Medicare (2026).Novitas Solutions Medicare.That a Medicare Administrative Contractor publishes the enrollment workflows that bind providers in its states — including the opt-out affidavit, its effective-date and renewal instructions, and the guidance a provider follows to file and to build a compliant private contract..
• Prepare a private-contract template that includes the elements CMS's current opt-out rules require, per your contractor's guidance 2Ref 2Novitas Solutions Medicare (2026).Novitas Solutions Medicare.That a Medicare Administrative Contractor publishes the enrollment workflows that bind providers in its states — including the opt-out affidavit, its effective-date and renewal instructions, and the guidance a provider follows to file and to build a compliant private contract..
• Keep your good-faith-estimate process for uninsured and self-pay patients running — opting out doesn't end it 4Ref 4Centers for Medicare & Medicaid Services (2026).No Surprise Billing.That the No Surprises Act requires good-faith estimates for uninsured and self-pay patients, an obligation that continues regardless of a provider's Medicare participation or opt-out status. As of July 2026..
• Weigh the decision against your patient mix and confirm you don't actually want non-participating status instead.