Everything to know about MLB’s qualifying offer, from how it works to likely candidates

The 2023 offseason is already rocking and rolling, and free agency is officially set to get underway at 5 p.m. ET on Monday, Nov. 6. But things aren’t quite as simple as simply identifying and signing available players. There are some ins and outs to be aware of as Hot Stove season gets rolling — including the qualifying offer, a somewhat obscure but nonetheless very important part of the MLB rulebook.

The goal of the QO is simple: to cushion the blow of losing a free agent to another team by handing out draft compensation. Each year, every time has five days after the World Series ends to extend the qualifying offer — a one-year deal set at the average of the top 125 salaries in baseball, this year amounting to just over $20 million — to each of their pending free agents who is eligible to receive it (more on that in a little bit). Players who accept it remain with their team for another year at that salary; players who reject it officially enter free agency, but with draft compensation attached. (Once offered the QO, players have until Nov. 14 to make their decisions.)

Sound simple enough? Great, then let’s dive into the details and take a look at this offseason’s potential QO candidates.

How the qualifying offer works

First thing’s first: Just how does the league determine the level of draft compensation attached to each player? Once upon a time, it was nice and easy: Every team that lost a free agent was given a pick in a compensatory round that immediately followed the first round of the next year’s MLB Draft. Now, though, things are a bit more complicated:

The Athletics, Brewers, Diamondbacks, Guardians, Mariners, Marlins, Orioles, Pirates, Rays, Reds, Rockies, Royals, Tigers, and Twins all received revenue sharing this season, so those first two scenarios apply to them: If any of their players who’ve been offered the QO reject it and sign free-agent deals elsewhere for less than $50 million, they’ll receive a pick after competitive balance round B in next year’s draft; if any of those players sign elsewhere for $50 million or more, they’ll get a pick following the first round. The Blue Jays, Braves, Dodgers, Mets, Padres, Phillies, Rangers, and Yankees are on the hook for the competitive balance tax, so they’ll only receive a pick after the fourth round for any free agents who reject the QO and sign elsewhere. The seven teams in the middle — the Astros, Cardinals, Cubs, Giants, Nationals, Red Sox and White Sox — would receive a pick after competitive balance round B.

Of course, that’s only one half of the equation. There’s also the matter of what draft compensation teams signing those QO-offered free agents have to give up:

Those eight teams that paid the CBT will have to give up their second- and fifth-highest draft picks, plus $1 million in international bonus money for each QO free agent they sign. The 14 teams that received revenue sharing are only on the hook for their third-highest, while the teams in the middle will cough up their second-highest.

Last offseason, 14 players received the QO: Joc Pederson and Martín Pérez accepted it; Aaron Judge, Brandon Nimmo, and Anthony Rizzo signed new contracts to remain with their teams; and Tyler Anderson, Chris Bassitt, Xander Bogaerts, Willson Contreras, Jacob deGrom, Nathan Eovaldi, Carlos Rodón, Dansby Swanson, and Trea Turner rejected the QO and signed with new teams, giving their former clubs compensatory draft picks. (Teams do not gain or lose picks for re-signing their own qualified free agent.)

Players ineligible to receive qualifying offer

Most free agents are eligible for the QO, unless they fall under either of two conditions: 1) they must have spent the entire 2023 season with one team and 2) they have not received the QO previously. This affects a number of high-profile free agents this winter. Jordan Montgomery and Jeimer Candelario were each traded at the deadline, while Marcus Stroman, Eduardo Rodriguez and Justin Turner have all taken the QO before and are thus ineligible to be offered it again.

Players likely to receive qualifying offer

The first name on this list is easy: Shohei Ohtani is a lock to be offered the QO, and a lock to turn it down as he hits a potentially historic free agency. As a rule, the top free agents on the market are almost guaranteed to decline the qualifying offer, as they’re good enough that teams will be willing to give up the draft compensation to sign them — much as the Phillies did with Trea Turner and the Yankees did with Carlos Rodon last offseason. This year, that applies to names like Cody Bellinger (Cubs), Matt Chapman (Blue Jays), Sonny Gray (Twins), Josh Hader (Padres), Aaron Nola (Phillies) and Blake Snell (Padres) in addition to Ohtani. Making the qualifying offer is a no-brainer for each of those teams, and rejecting it is a no-brainer for the players.

Players less likely to receive qualifying offer

Here things get a bit tricker — teams want that draft compensation, but they also don’t want to extend the qualifying offer to a player that will then accept it and leave them on the hook for more than $20 million next season. Some bubble candidates include Phillies first baseman Rhys Hoskins — who would likely accept if the Phils offered given his ACL tear — Mariners outfielder Teoscar Hernandez and Marlins DH Jorge Soler.

As for those who almost certainly won’t be offered the QO, the list starts with Tim Anderson, who just had his $14 million option turned down by the White Sox; Chicago isn’t about to turn around and offer him a $20 million deal. The Dodgers have never offered the QO to Clayton Kershaw out of respect for his legacy, choosing instead to let him make decisions about his future on his own timeline and with no strings attached. Beyond those two, Kevin Kiermaier (Blue Jays), Kenta Maeda (Twins), J.D. Martinez (Dodgers) and Luis Severino (Yankees) would all almost certainly accept the QO if it were offered to them, as it would be more than they’d fetch on the open market.