A Medicare Patient's Doctor Wants $2,400 a Year to Stay. A 2004 Federal Alert Spells Out What That Fee Can't Cover.

A letter shows up from a doctor you’ve seen for years. Staying in the practice will now cost $2,400 a year. Medicare will keep paying for your visits.

That’s the setup of a 247 Wall St. explainer published Oct. 17 by Gerelyn Terzo. Its advice is sound: “Pay for the access only after you know exactly what the fee buys.” The piece also talks about “concierge and direct-primary-care practices” as one group. For a Medicare patient, those two can sit on opposite sides of a federal line.

The 2004 alert on extra charges

The federal warning about fees like that $2,400 one is more than two decades old. On March 31, 2004, the HHS Office of Inspector General issued an alert to Medicare participating physicians about extra charges.

It draws the line in three sentences. A participating doctor can charge Medicare patients for items and services Medicare doesn’t cover. The doctor can collect deductibles and coinsurance. But a request for “any other payment for covered services” exposes the doctor to “substantial penalties and exclusion from Medicare and other Federal health care programs.”

The alert’s one example reads like a template for a modern conversion letter. A physician offered a “Personal Health Care Medical Care Contract” with an annual fee of $600. He described the services as not covered. Among the services the contract offered were “coordination of care with other providers,” “a comprehensive assessment and plan for optimum health,” and “extra time” spent on patient care. OIG alleged that at least some of the contract’s services were already covered by Medicare. The physician agreed to pay a settlement and to stop offering the contracts.

Look at that list again. In DPC Insider’s reading, extra time and care coordination sound a lot like a membership practice’s pitch. A fee is allowed. Charging a Medicare patient twice for care Medicare already pays for is what draws the penalty, and the facts of each contract decide which side a fee lands on. The 247 Wall St. piece puts it plainly: a practice “cannot simply repackage access to Medicare-covered care and charge for it a second time.”

The alert also closes a side door. Its closing note says non-participating doctors can face the same penalties for overcharging on covered services, whether or not they accept assignment for a given claim.

How many practices sit on the Medicare side

A Health Affairs study published in December 2025 counted concierge and DPC practices together. The Johns Hopkins summary reports the number of practices grew 83.1% from 2018 to 2023. According to 247 Wall St.’s reading of the study, roughly 60% of the clinicians in those practices participated in Medicare.

247 Wall St. doesn’t say how many of them are participating providers, the status the 2004 alert addresses. The Hopkins summary also reports concierge and DPC as one combined count, so those figures can’t say how many of the clinicians work in DPC practices running a hybrid model.

The other rulebook: opting out

A DPC practice that opts out of Medicare plays by a different set of rules. Under 42 CFR 405.425, no payment goes from Medicare, or from any Medicare Advantage plan, to an opted-out doctor, apart from emergency and urgent care exceptions. The doctor is barred from submitting claims. Outside emergency and urgent care, covered services reach a Medicare patient only through a private contract.

That contract runs on a clock. The initial opt-out period is two years under 42 CFR 405.410, and a new private contract is required for each two-year period.

For a patient under that contract, the doctor submits no Medicare claim, so a membership fee has no Medicare payment to duplicate. The exception is emergency or urgent care for a Medicare patient with no contract: under 42 CFR 405.440, the doctor must submit that claim and can collect no more than the limiting charge. The patient pays the practice directly for everything that practice provides. That is a real cost, and patients should hear it stated that bluntly.

One provision gets lost in most coverage. Section 405.425(i) lets an opted-out doctor order, certify, prescribe or refer for Medicare-covered items and services, provided the doctor isn’t paid for them. So an opted-out DPC doctor can still write the order for a Medicare-covered test or a specialist referral.

Where DPC Fits

The 247 Wall St. patient faces a concierge decision: one fee stacked on top of Medicare billing. If the internist participates in Medicare, the 2004 alert says that fee can’t be a second payment for covered services. An opted-out DPC practice offers a different deal. The patient pays the practice directly under a private contract. The doctor sends Medicare no claims outside emergency and urgent care, and can still order Medicare-covered tests and referrals.

Neither deal is free, and neither suits every patient on a fixed income. But they’re different contracts under different federal rules, and a reader who sees them called the same thing can’t tell which one is in the envelope.

If you run an opted-out practice and take Medicare patients, the private contract is your clearest tool. The regulations list what it must say. A patient who has just read a concierge explainer may expect Medicare to keep paying for your visits, so it helps to say plainly, before they sign, that it won’t.