Reed Tinsley, CPA

HIPAA and a new registration area

Suppose you have a new registration area with a counter where patients sit when registering and signing consent forms. Sufficient space is available for two patients to register simultaneously. A wooden panel measuring two feet wide, five feet high, and four inches thick separates the two stations. Is this HIPAA-compliant? I think this approach to protecting patient privacy during the registration process seems very reasonable. The HIPAA privacy rule does not include specific protections that you must provide. Instead, covered entities may determine on their own how to protect privacy.

A tax warning to S corps

IRS audits now routinely review S corporation payments to shareholders to see if payroll taxes are being avoided by treating payments to shareholder-officers as loans or shareholder distributions of cash or property. A physician officer performing services for a corporation is entitled to payment; those payments are wages. For federal employment tax purposes, corporate officers are employees.

 

Avoiding employment taxes by treating compensation as cash distributions, expense reimbursements, or loans rather than as wages will get you in hot water. For clear details on the rules, go to the IRS Web site (www.irs.gov) and type in the Search Box, “FS-2008-25.” [Fact Sheet 2008-25]

Create a system to go after outstanding balances

Set up a timetable for handling account balances as they reach certain ages. For example, at 35 days, send a letter that asks patients to pay the remainder of the balance within 10 days. At 45 days, call the patients as a reminder of the debt and to offer a payment plan. At 55 days, take more extreme measures (e.g., involving a collection agency).

Once you determine which aged balances to tackle, you must go about obtaining them in the appropriate manner. This could mean taking steps internally (e.g., making collections calls, sending letters, or offering discounts) or externally (e.g., enlisting a collection agency or collecting through bankruptcy court or the deceased patient's estate). The appropriate method will vary from practice to practice.

FTC announces antitrust settlement with doc groups

In yet another example of how IPAs can get in to trouble, two physician groups separately have settled charges that they violated federal antitrust law by engaging in price-fixing conspiracies to extract higher payments from certain health insurers, the Federal Trade Commission announced.

Under the proposed settlements, which are subject to final approval from the FTC, neither group admits to any wrongdoing. But, they each agreed not to engage in joint negotiating tactics on behalf of their physician members. The independent practice associations are the 500-physician AllCare IPA based in Modesto, Calif., and the 365-physician Boulder (Colo.) Valley Individual Practice Association.

According to civil antitrust complaints filed simultaneously with the proposed settlements, each group allegedly orchestrated a price-fixing conspiracy among its respective physician members by jointly negotiating service contracts with certain insurers. In some cases, according to the FTC, the groups threatened to terminate their physicians’ contract with an insurer unless the insurer met the groups’ price demands.

The FTC said the groups’ actions restrained trade and artificially raised prices for the physicians’ services. The proposed agreements order the groups to cease and desist for a period of 20 years from directly negotiating prices for physician services with payers or indirectly assisting their physicians to jointly do the same.

Richard Feinstein, AllCare’s antitrust attorney, said the FTC’s allegations were aimed at a small number of preferred provider organization contracts entered into by the group. He said the group decided that it made sense to settle the case without admitting any wrongdoing and put the matter behind it. Feinstein said the settlement restrictions would have no financial effect on the group moving forward.

In a statement issued by Boulder Valley, the group denied the FTC’s charges but said, “Because it cannot afford to fight the federal government, the Boulder Valley IPA has decided to settle these charges by agreeing to the consent order.” The public comment period on the proposed settlements ends Jan. 22, 2009, after which the FTC will make them final.

For more detailed information: http://www.ftc.gov/bc/healthcare/antitrust/litigation.htm

Are small providers exempt from HIPAA?

Are small providers exempt from HIPAA? The term “small providers” originates in the Administrative Simplification Compliance Act (ASCA), the law which requires those providers/submitters who bill Medicare to begin submitting only electronic claims to Medicare on October 16, 2003 in the HIPAA format. However, ASCA does provide an exception to the Medicare electronic claims submission requirements to “small providers”. ASCA defines a small provider or supplier as: a provider of services with fewer than 25 full-time equivalent employees or a physician, practitioner, facility or supplier (other than a provider of services) with fewer than 10 full-time equivalent employees.

It is important to keep in mind that this provision does not preclude providers from submitting paper claims to other health plans. In addition, if a provider transmits any of the designated transactions electronically, it is subject to the HIPAA Administrative Simplification requirements regardless of size.

How to evaluate pay-for-performance initiatives

When looking at the growing pool of pay-for-performance (P4P) programs, you might wonder how to determine what you're getting into before you sign up. To understand your organization's rights and obligations under such a program, consider the following questions when evaluating P4P proposals:

1. Does the provider give you advance notice of the quality measures it uses?
2. Many payers establish programs that rate and grade performance based on the performance of a community of providers. Some programs refer to these as "silos" or "pods." Do you agree with the group of providers with whom you are included?
3. Do you know in advance what the benchmarks will be?
4. Will you have the ability to determine as you go how your performance measures up?
5. Are the performance determinations subjective?
6. Is the formula for translating your performance score into an incentive payment transparent?
7. Will complying with the reporting requirements be administratively burdensome?
8. Who has access to the quality data once they are amassed by the payer?
9. Are your measures averages for the nation or the region?
10. If the arrangement does not work for you, how can you release yourself from the P4P program?

How to report fringe benefits on the W-2

Taxable fringe benefits include cash (bonuses, severance or vacation pay) and noncash gifts such as season tickets to sporting events and gift certificates or gift cards. Taxable fringes are subject to FIT, FITW, FICA, FUTA, and some state and local taxes. Report on the W-2 in Boxes 1, 3, 5, and 15-20.

 

Exempt fringe benefits that are not reported on the W-2 and not subject to FIT, FITW or FUTA include:

 

·         no-additional-cost services (e.g., free hotel rooms for hotel employees);

·         qualified employee discounts for merchandise—if the discount does not exceed the gross profit percentage;

·         qualified employee discounts for services, as long as the discount does not exceed 20%;

·         working-condition fringes (e.g., reimbursed or paid-for job-related training, long-distance calls, and faxes); and

·         use of employer-owned or -leased athletic facilities (if not owned or leased by the employer, benefit is taxable) and de minimus fringes (e.g., a holiday turkey or ham).

Want a free copy of Quickbooks Pro 2009? December 22 is the day!

Intuit will offer the Windows version of QuickBooks Pro 2009 for free at all Staples stores on Monday, Dec. 22, for one day only.

The offer works like this:

• The regular price at Staples is $199.99.
• The customer will receive $40 in instant savings.
• The customer at the store will receive a $159.99 mail-in rebate form.
• When the customer mails in the rebate form they will receive, some weeks later, a rebate for $159.99.
• Once the customer obtains the rebate, their base costs are zero: $199.99 - $40.00 - $159.99 = $0.
• The buyer may still be responsible for sales tax at the time of purchase; sales tax is not free.

Here is a link to the promotional advertisement; The offer is for one day only; limited to one copy of QuickBooks Pro per customer. You can find the nearest Staples store at www.staples.com or buy on-line.

Medicare Physicians and Non-Physician Practitioners Internet-Based Medicare Enrollment Is Available in 34 States

Now there's a better way for physicians and non-physician practitioners to enroll or make a change in their Medicare enrollment information. The Internet-based Provider Enrollment, Chain and Ownership System (PECOS) will allow physicians and non-physician practitioners to enroll, make a change in their Medicare enrollment, view their Medicare enrollment information on file with Medicare, and check on the status of a Medicare enrollment application via the Internet.

 

Previously, CMS announced that Internet-based PECOS is available to physicians and non-physician practitioners in the District of Columbia and the following states:

  

Connecticut	Delaware	Hawaii	Idaho
Illinois	Indiana	Iowa	Kansas
Kentucky	Maryland	Michigan	Minnesota
Missouri	Nebraska	Nevada	New Jersey
New York	North Carolina	Ohio	Pennsylvania
South Carolina	Tennessee	West Virginia	Wisconsin

 

CMS has recently announced the expansion of the Internet-based PECOS for physicians and non-physician practitioners in the following states:

Alaska	Arizona	Florida	Montana
North Dakota	Oregon	South Dakota	Utah
Washington	Wyoming

Physicians and non-physician practitioners in the District of Columbia and the states shown above who wish to access Internet-based PECOS may go to: https://pecos.cms.hhs.gov 

 

CMS will expand the availability of Internet-based PECOS for physicians and non-physician practitioners to all states over the next two months. In addition, CMS will make Internet-based PECOS available next year to all providers and suppliers (except DMEPOS suppliers).

Summary of OIG Advisory Opinion 08-22

From the American Health Lawyers Association (www.healthlawyers.org):

On December 8, 2008, the Department of Health and Human Services, Office of Inspector General (OIG) issued Advisory Opinion 08-22, in which the OIG concluded that the part-time employment of two physicians would not generate prohibited remuneration under the anti-kickback statute, and thus would not result in sanctions. The Requestor of the opinion is a nonprofit, tax-exempt corporation established for the purpose of employing physicians. It is wholly owned by another corporation, which is not identified, and the relationship between the physicians and the parent entity is not part of the OIG's analysis. Each of the physicians maintains medical practices separate and apart from the Requestor. The Requestor would employ the two physicians on a part-time basis to perform endoscopies on the Requestor's premises. The amount paid to the physicians would be consistent with fair market value.

The OIG analyzed the part-time employment arrangement under the statutory employment exception and the regulatory definition of "remuneration." In doing so, the OIG noted that the Requestor certified that the physicians would be bona fide employees and they would be paid for professional services they personally perform. Further, endoscopy services are paid for in whole or in part by Medicare, Medicaid, or other federal healthcare programs. Accordingly, the OIG found that the part-time employment arrangements would meet the statutory exception for employment arrangements, and that the compensation paid to the physicians would not constitute prohibited remuneration under the anti-kickback statute.

Of particular interest, although the Requestor certified that the amounts paid to the physicians would be fair market value, the OIG specifically states that it did not rely on the certification in rendering its opinion. Further, the OIG explicitly limits its opinion to the anti-kickback statute and contrasts the anti-kickback statute with the Stark self-referral statute, for which fair market value is a criterion.

*The Fraud and Abuse Practice Group Leadership of the American Health Lawyers would like to thank its Advisory Opinions Task Force members Julie E. Kass (Ober Kaler, Baltimore, MD) and Joseph M. Kahn (Nexsen Pruet PLLC, Greensboro, NC), for respectively writing and reviewing this summary.