Escobar, who will turn 35 in December, batted .288 with 21 doubles, two triples, four homers and 28 RBIs in 75 games with the Nationals after signing with the club in July.
Before joining Washington, he hadn't been in the major leagues since 2018.
Escobar has a career average of .259 with 245 doubles and 470 RBIs over a total of 12 seasons in the majors with three clubs. He was an AL All-Star for the Kansas City Royals in 2015.
This is the first move of what figures to be a busy offseason for general manager Mike Rizzo after Washington finished last in the NL East with a 67-95 record. The regular season ended Sunday.
Rizzo opted to tear down the roster at the trade deadline, parting with more than a half-dozen veterans, including shortstop Trea Turner -- the eventual NL batting champion -- and starting pitcher Max Scherzer.