March 27, 2014

EHR Incentive Program: Medicare EPs Must Attest by March 31 to Receive 2013 Incentive

If you are an eligible professional (EP), the last day you can register and attest to demonstrating meaningful use for the 2013 Medicare Electronic Health Record (EHR) Incentive Program is March 31, 2014. You must successfully attest by 11:59pm ET on March 31, to receive an incentive payment for your 2013 participation. CMS extended the deadline for eligible professionals to attest to meaningful use for the Medicare EHR Incentive Program to allow more time for providers to submit their meaningful use data and receive an incentive payment for the 2013 program year.

Payment adjustments for EPs will be applied beginning January 1, 2015, to Medicare participants that have not successfully demonstrated meaningful use. For more information, visit the payment adjustment tipsheet for EPs. You must attest to demonstrating meaningful use every year to receive an incentive and avoid a payment adjustment.

http://www.cms.gov/Regulations-and-Guidance/Legislation/EHRIncentivePrograms/Downloads/PaymentAdj_HardshipExcepTipSheetforEP.pdf

March 26, 2014

Small Business Health Care Credit

In a news release, the IRS recommended that small businesses determine whether they can take the small business health care tax credit. The IRS website has a page devoted to the small business health care tax credit. The website includes a tax credit estimator, helpful examples, and a section with frequently asked questions (FAQs). The website is located at:

www.irs.gov/uac/Small-Business-Health-Care-Tax-Credit-for-Small-Employers

The credit is currently available to eligible employers from 2010û2013 and for two additional years beginning in 2014. Employers that filed previously and later learn that they are eligible for the credit can amend their returns within the three-year statute of limitations to request a refund. News Release IR-2014-27.

March 21, 2014

Ten Facts about Capital Gains and Losses

When you sell a ’capital asset,’ the sale usually results in a capital gain or loss. A ‘capital asset’ includes most property you own and use for personal or investment purposes. Here are 10 facts from the IRS on capital gains and losses:

1. Capital assets include property such as your home or car. They also include investment property such as stocks and bonds.

2. A capital gain or loss is the difference between your basis and the amount you get when you sell an asset. Your basis is usually what you paid for the asset.

3. You must include all capital gains in your income. Beginning in 2013, you may be subject to the Net Investment Income Tax. The NIIT applies at a rate of 3.8% to certain net investment income of individuals, estates, and trusts that have income above statutory threshold amounts. For details see IRS.gov/aca.

4. You can deduct capital losses on the sale of investment property. You can’t deduct losses on the sale of personal-use property.

5. Capital gains and losses are either long-term or short-term, depending on how long you held the property. If you held the property for more than one year, your gain or loss is long-term. If you held it one year or less, the gain or loss is short-term.

6. If your long-term gains are more than your long-term losses, the difference between the two is a net long-term capital gain. If your net long-term capital gain is more than your net short-term capital loss, you have a 'net capital gain.’

7. The tax rates that apply to net capital gains will usually depend on your income. For lower-income individuals, the rate may be zero percent on some or all of their net capital gains. In 2013, the maximum net capital gain tax rate increased from 15 to 20 percent. A 25 or 28 percent tax rate can also apply to special types of net capital gains. 

8. If your capital losses are more than your capital gains, you can deduct the difference as a loss on your tax return. This loss is limited to $3,000 per year, or $1,500 if you are married and file a separate return.

9. If your total net capital loss is more than the limit you can deduct, you can carry over the losses you are not able to deduct to next year’s tax return. You will treat those losses as if they happened that year.

10. You must file Form 8949, Sales and Other Dispositions of Capital Assets, with your federal tax return to report your gains and losses. You also need to file Schedule D, Capital Gains and Losses with your return.

For more information about this topic, see the Schedule D instructions and Publication 550.

March 19, 2014

How one physician practice is tackling transition to ICD-10

If haven't already started working on the transition to ICD-10, you might be in a heep of trouble down the road. Here is how one physician practice is tackling the transition:

Created a task force that meets weekly and communicates updates with the managers and clinicians (at least) monthly.  The practice's main areas of focus have included:

1.  Coding and documentation audit - it hired a consultant to review coding and documentation to discover what we need in those areas to be able to successfully bill (and get paid) in ICD-10.

2.  Training - the practice reviewed several training courses, went to ICD-10 training "bootcamps", got several of its coders ICD-10 certified, and is now putting together customized training for its clinicians and other end users.

3.  Practice management system and related upgrades - the practice upgraded to an ICD-10 compliant version of its medical billing software and is also changing EDI vendors to improve technical support.  The physician practice is also working with its vendors and third party payers to do as much testing prior to 10/1 as possible, and also to monitor transactions more closely after 10/1.

4.  Clinical content development - Its Health Information Management team is reviewing the results of the coding audit along with the materials from the software vendors to modify clinical content within the EMR and to also to facilitate correct coding.  Their plan is to begin testing this internally with the clinicians in the third quarter of this year after their training is done in second quarter.

5.  Communication and change management - this is a focus for every significant initiative in this physician group.

Here are some things to keep in mind with regard to ICD-10:

There is a lot of the training out there is simply not very helpful.  Some of it is a bunch of vague and semi-scary stuff about the history, the cost, and the whatever of ICD-10 generally. So you've got to do some due diligence before throwing time and money at training.

The payors seem not to be in a helpful mood. If you are having a positive experience, please let me know.  Many of the payors will not allow practices to test transactions with them prior to 10/1.  They are  saying something to the effect of "don't worry, we won't have any ICD-10 denials for X months during the transition", but I don't believe that this will be the case because any denial that is tangential related to a diagnosis will, by default, be "ICD-10 related".  So do all you can to vet with your payors beforehand, and again be extremely diligent with them after 10/1.

Finally if you a haven't done so, you might want to talk to your bank about increasing your credit line limit just in case cash flow goes to hell resulting from the potential havoc rendered by ICD-10.

March 17, 2014

The Fast And The Dead

Submited by Mark Weiss, JD

Let's listen in to a series of calls from a potential deal partner to the office of the Smith and Jones Medical Group:

Receptionist: Good morning, Smith and Jones Medical Group.

Potential Deal Partner:  Good morning. May I please speak with Dr. Smith.

Receptionist:  I’m sorry, Dr. Smith is out.

Potential Deal Partner: Well then, may I please speak with Dr. Jones.

Receptionist:  I’m sorry, Dr. Jones is tied up.

Potential Deal Partner: OK. I’ll call back next week.

ONE WEEK PASSES

Receptionist: Good morning, Smith and Jones Medical Group.

Potential Deal Partner: Good morning.  May I please speak with Dr. Smith.

Receptionist:  I’m sorry, Dr. Smith is out.

Potential Deal Partner: Well then, may I please speak with Dr. Jones.

Receptionist:  I’m sorry, Dr. Jones is tied up.

Potential Deal Partner: OK. I’ll call back next week.

ANOTHER WEEK PASSES

Receptionist: Good morning, Smith and Jones Medical Group.

Potential Deal Partner: Good morning. May I please speak with Dr. Smith.

Receptionist:  I’m sorry, Dr. Smith is out.

Potential Deal Partner: Well then, may I please speak with Dr. Jones.

Receptionist:  I’m sorry, Dr. Jones is tied up.

Potential Deal Partner: Look, every time I call I ask for Dr. Smith and she’s out. Then I ask for Dr. Jones and he’s tied up. What is going on over there?

Receptionist:  Well, it’s actually very simple. Dr. Jones is extremely busy overseeing our staff working at four hospitals and every time she’s out, she ties up Dr. Jones. She can’t have him making decisions in her absence.

****

A silly little joke can illustrate a large problem.

If a medical group cannot govern itself, if it is structured like a true democracy, one owner, one vote on everything, or if it has a bloated board, it will never be able to make decisions with the speed required for its continued success. The market for medical services is changing rapidly. One of the tremendous advantages that an independent medical group has, unless it ties itself up, is the ability to make decisions quickly, to increase the pace of, in the words of the late strategist John Boyd, its loop of observation, orientation, decision and action. But many groups throw away that advantage out of the mistaken belief that their business is a club.

They become too slow, too confused and without business focus.

Proper governance is not just a goal, it’s a precondition to success, even to, in this market, continued business existence. Oh, you might be thinking that you got to where you are now with a 26 member board. But that’s like being a real estate agent in a booming market — you think you’re a genius salesperson when you’re simply riding a market wave. Yet now you’re on the edge of a precipice and it’s taking your group months to decide what color your new logo should be.

In today’s market, there’s the fast. And then there’s the dead.

______

Mark F. Weiss is an attorney who specializes in the business and legal issues affecting physicians and facilities on a national basis. He holds an appointment as clinical assistant professor of anesthesiology at USC’s Keck School of Medicine and practices with The Mark F. Weiss Law Firm, a firm with offices in Dallas, Los Angeles and Santa Barbara representing clients across the country. He can be reached by email at [email protected].

March 12, 2014

Physician office front desk collections

Today, patients are responsible for much larger portions of their medical bills. Copayments are on the rise, as are coinsurance and deductibles. It’s not a stretch to say that patients’ financial responsibility is the largest it’s been since medical insurance came onto the scene in the mid-20th Century. If you’re relying solely on your business office to respond to this trend, you won’t be successful. Your patients are your worst payers – and asking them for money long after the fact will only result in higher postage costs and ballooning accounts receivable. Engaging your front office to perform time-of-service collections is essential for financial success.

Therefore, it’s an opportune time to execute these strategies used by medical practices that are successfully dealing with today’s reimbursement environment:

Set expectations. Develop a financial policy to distribute to patients when they arrive; make it available on your website, too. Hang tasteful but clear signage in the front office. Don’t beat around the bush by printing signs that say, “Our Practice Expects You to Pay Your Copayment.” Instead, be direct with signs that read, “Your Insurance Company Requires You to Pay Your Copayment.” Send the message professionally, but make it clear that you expect to receive payment at the time of service.

Know how to ask. There is an art to collections, and a large part is knowing how to ask for money. Instruct your staff to stop asking patients, “Would you like to pay?” Replace that request with “How would you like to pay today?” As they ask for payment, staff must make eye contact with the patient (or guarantor) and use his/her name during the conversation. Writing out the receipt while asking the question is a great tactic because it sends the message to patients that your practice expects payment.

Don’t forget the balance. Time-of-service collections include the amount owed for that particular visit – and that which is outstanding from a prior encounter. Don’t hold yourself to collecting past-due balances – ask for all balances, regardless of age. Print a statement for all patients at check out that reflects any payments they have made as well as the balance due. Giving these statements to patients at check-out is not only free (other than the cost of the paper), but it reinforces to them your expectations of getting paid. It also eliminates the excuse patients so often give to your business office: “I never received a statement.”

March 10, 2014

HIPAA - patient sign-in sheets or call out the names

Question:  May physician offices use patient sign-in sheets or call out the names of their patients in their waiting rooms?

Answer: Yes. Covered entities, such as physician’s offices, may use patient sign-in sheets or call out patient names in waiting rooms, so long as the information disclosed is appropriately limited. The HIPAA Privacy Rule explicitly permits the incidental disclosures that may result from this practice, for example, when other patients in a waiting room hear the identity of the person whose name is called, or see other patient names on a sign-in sheet. However, these incidental disclosures are permitted only when the covered entity has implemented reasonable safeguards and the minimum necessary standard, where appropriate. For example, the sign-in sheet may not display medical information that is not necessary for the purpose of signing in (e.g., the medical problem for which the patient is seeing the physician).

March 06, 2014

Multi-Million dollar settlement in Halifax Stark compensation case

Facing as much as $1.1 billion in damages and civil penalties and having already spent more than $15 million in legal fees, Halifax Hospital in Daytona Florida averted jury selection in its upcoming trial by reaching an $85 million tentative settlement with the Department of Justice, according to the whistleblower’s legal counsel.

If confirmed, the settlement would represent one of the largest Stark settlements in history, albeit well behind the $237 judgment against Tuomey Healthcare System last year—which unlike Halifax, gambled its case with the jury.

The settlement follows the federal court’s November 13 ruling that Halifax’s compensation of physicians violated the Stark Law’s prohibition against paying for Medicare referrals, even though the physicians were employees of the hospital and were paid from a pool in proportion to their personally-performed services.

The case, United States et al. v. Halifax Hospital Medical Center et al., Case No. 6:09-cv-Orl-31TBS, Fla. Middle Dist., arose when a Halifax compliance officer turned whistleblower and filed a qui tam action alleging that the hospital’s compensation of its six employed medical oncologists violated the Stark Law. At issue was the oncologists’ bonus formula.

The complaint alleged that Halifax had agreed to pay each physician a portion of an incentive pool equal to 15% of the “operating margin” for the hospital’s medical oncology program. The pool included not only the physicians’ billings for the professional services they personally performed, but also the fees earned by the hospital for the physicians’ referrals to the hospital. According to the court’s prior ruling, the fatal flaw, from a Stark standpoint, was the inclusion of technical component revenue derived from the oncologists’ own referrals—and the flaw was not remedied by the subsequent division of the pool among the physicians in proportion to each physician’s personal share of the group’s total professional service billings.

In constructing the compensation formula, Halifax had relied on an opinion from outside counsel that the bonuses “arguably” complied with Stark’s employment exception. However, the court ruled that the compensation of an employee cannot be determined in a manner that takes into account, directly or indirectly, the volume or value of the employee’s Medicare referrals to the employer. In this case, the court ruled, the physicians’ individual bonuses varied on the basis of referrals because bonuses were based on operating margin of the entire oncology program—including fees for hospital services—and that margin would be improved by the physicians’ referrals in addition to the services that they themselves personally performed.

The only proof of “referral” required by the court was the physician’s listing as “attending,” “operating” or “other” physician on UB-92 and/or UB-04 forms. With over 75,000 tainted claims totaling more than $34 million in Medicare referrals, Halifax’s settlement—if finalized—could avert the potential for a $1 billion adverse verdict after treble damages, $11,000 per claim fines and whistleblower’s attorney’s fees are added.

Years to partnership

Question: In recruiting new doctor to our physician group medical practice, how many years before they should be eligible for partnership in the practice.  Thanks!!

Answer: My recommendation is 3 years with a small buy-in after the three year period. It usually takes three years to get a financial return on this big investment. Most new doctors today are looking for smaller buy-ins - it's becoming a major recruiting issue in a lot of service areas and for a lot of specialties. Extending the employment period to three years before being eligible for ownership I think warrants a smaller buy-in.

Years to partnership

Question: In recruiting new doctor to our physician group medical practice, how many years before they should be eligible for partnership in the practice.  Thanks!!

Answer: My recommendation is 3 years with a small buy-in after the three year period. It usually takes three years to get a financial return on this big investment. Most new doctors today are looking for smaller buy-ins - it's becoming a major recruiting issue in a lot of service areas and for a lot of specialties. Extending the employment period to three years before being eligible for ownership I think warrants a smaller buy-in.