Medicare for Therapists: Should You Opt In or Opt Out?

One of the most common questions we hear from therapists and healthcare providers starting a private practice is: “Should I opt in to Medicare?”

It’s not a simple yes or no. Deciding whether to become a Medicare provider can impact your client base, your practice finances, and even how you spend your time on administrative work. To help you make an informed decision, let’s take a closer look at what it means to opt in vs. opt out of Medicare, the pros and cons of each, and how to determine what’s right for your practice.

What Does It Mean to Opt In to Medicare?

Opting in to Medicare means you’ve officially completed Medicare credentialing and enrollment through the Centers for Medicare & Medicaid Services (CMS). Once enrolled, you can:

• Bill Medicare directly for covered services.

• Provide care to clients who rely on Medicare benefits.

• Be listed as a recognized Medicare provider, which adds to your professional credibility.

For many new or growing practices, enrolling with Medicare can feel like an obvious choice. But it’s important to weigh the benefits and challenges carefully.

Benefits of Opting In

1. Expanded Client Base
   Medicare covers a large and growing portion of the population—especially as more Baby Boomers become eligible. By opting in, you open your doors to a wider audience who may not otherwise be able to afford services without insurance coverage.

2. Improved Accessibility for Clients
   Many older adults, as well as people with disabilities, rely exclusively on Medicare. By enrolling, you reduce barriers to care and position your practice as accessible and inclusive.

3. Professional Credibility
   Being listed as a Medicare provider can increase trust among clients, referral sources, and other healthcare professionals. It signals that you’ve met federal standards and are recognized by the nation’s largest insurance program.

4. Direct Reimbursement
   Instead of relying on clients to submit claims, you can bill Medicare directly and receive payment for services. This reduces the financial burden on your clients and helps maintain steady revenue.

Challenges of Opting In

1. Variable Reimbursement Rates
   Medicare reimbursement changes every January. While recent years have seen small increases, is possible to see decreases based on Federal funding. Additionally, CMS often applies a “sequestration reduction” a mandatory, across-the-board 2% reduction in federal payments for Medicare services, initiated by the Budget Control Act of 2011. If your practice relies on consistency for maximizing revenue per session, this could be a drawback.

2. Administrative Burden
   Medicare comes with detailed documentation, compliance rules, and strict billing requirements. Failing to follow guidelines can lead to denied claims or even audits.

3. Understanding the different “parts” of Medicare
   Once you opt in, you’re only in with Medicare B. Clearly understanding B vs C, Supplement vs Secondary is important for clean billing, and timely payments.

What If You Don’t Opt In?

Not every provider chooses to work with Medicare—and that’s perfectly okay. If you don’t opt in, clients with Medicare coverage cannot use their benefits to see you. Unlike commercial insurance, simply not enrolling in Medicare means you cannot accept private payment from Medicare clients for covered services. Still, there is a pathway to consider:

Opting Out – This is different from not enrolling. By formally opting out, you notify Medicare that you will not accept assignment of benefits. You and your clients then sign a private contract, which allows you to see Medicare beneficiaries on a private-pay basis without submitting claims. Important: Opting out is the only way you can legally provide covered services to Medicare clients as private pay.

For some providers—particularly those running boutique or niche practices—opting out can be a good fit. It allows you to simplify your operations, reduce administrative stress, and focus on delivering personalized care.

How to Decide: Opt In or Opt Out?

The right choice depends on your goals, your client base, and your vision for your practice:

• Opt In if… you want to grow your client base, increase accessibility, and are comfortable navigating compliance and billing systems.

• Opt Out if… you prefer a streamlined, private-pay model, want to avoid administrative overhead, or are building a highly specialized practice.

There’s no “one-size-fits-all” answer—only the decision that best aligns with your business strategy and client needs.

Disclaimer: This information is provided for educational purposes only and should not be considered legal or financial advice. Medicare rules and requirements can change, so always consult official CMS guidelines or a qualified advisor before making decisions about enrollment or opting out.