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Surviving

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Our exclusive findings forecast rough weather. Here’s how to stay dry.

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Surviv the By Robert Lowes

In harsh economic times that test doctors’ souls, Buffalo family physician Raul Vazquez performs a lot of tests. Spirometry. Nerve conduction studies. EKGs. Stress tests. Ultrasound imaging to detect peripheral arterial disease.

For Vazquez, these so-called ancillary services are in fact essential to the financial well-being of his practice. With payment from private health insurers for evaluation and management services continuing to shrink — as evidenced by our 2009 Physician Fee Schedule Survey — physicians like Vazquez can’t get by with old-fashioned primary-care medicine. Merely sitting down with a patient, diagnosing his illness, and writing a prescription won’t cut it anymore. “If you just see patients, you might as well close up,” says Vazquez. Faced with enrollment declines and dismal investment returns, insurance companies in 2009 accelerated their now-customary pay cuts, according to our latest fee schedule survey. For bread-and-butter office visits for new patients, established patients, and consults, reimbursement declined an average 7.3 percent, our data reveal, and the bellwether 99213 — the most frequently billed code — fell 8.6 percent to $65.49. (Our analysis assumes that physicians reported private-pay allowables — the rate physicians contract for, which typically includes money collected from the patient — as opposed to dollar amounts on the insurance checks they receive.) Private health plans have been tight-fisted for years, but the gloomy economy only tightened their grip in 2009. When employers lay off workers, enrollment drops in company-sponsored health plans, which means lower premium revenue. And a moribund stock market in 2008 meant that insurers also earned less on their investments. So they try to preserve their profit margins by paying doctors less, says Susanne Madden, president of The Verden Group, a consulting group focused on managed care. “Payers are cost-shifting to physicians,” says Madden. “By putting downward pressure on physician reimbursement, they don’t have to bump up their premiums as much to maintain their profitability.” But who’s worrying about physician profitability? Well, you are. And so are we. The skies are gloomy and the rain is falling for private-office physicians; our 2009 Fee Schedule Survey is not exactly forecasting picnic weather. Still, there are some things you can do to get some cover. 2

| Physicians Practice | January 2010

www.physicianspractice.com

ving How to stay dry in turbulent weather

illustration: Dave Cutler

Cover Story pay you as much as Medicare.” Middle New North Pacific South South National This trend is Mountain Atlantic England Central Central East Average becoming a talking 99201 $49.50 $44.60 $47.00 $44.70 $60.60 $49.30 $48.90 $49.23 point for doctors 99202 $66.50 $74.60 $67.70 $68.50 $85.80 $68.10 $72.60 $71.97 who favor a single99203 $87.60 $105.00 $92.90 $99.30 $118.00 $93.30 $97.20 $99.04 99204 $114.30 $139.20 $125.00 $139.00 $145.80 $123.70 $131.20 $131.17 payer healthcare 99205 $135.60 $162.90 $132.30 $155.50 $161.40 $145.70 $153.40 $149.54 system. “Medicare 99211 $27.50 $24.20 $29.20 $27.50 $33.10 $27.90 $27.60 $28.14 for all is not a bad 99212 $41.30 $44.20 $47.90 $43.60 $54.10 $41.50 $43.50 $45.16 concept,” says 99213 $58.30 $69.10 $70.00 $67.50 $73.10 $58.40 $62.00 $65.49 Vazquez. Adds 99214 $79.20 $98.00 $98.30 $94.90 $98.50 $84.20 $86.50 $91.37 99215 $100.90 $120.60 $114.30 $116.50 $115.30 $108.10 $113.10 $112.69 Madden, “Reimbursement rates 99241 $77.80 $68.80 $68.30 $69.00 $87.70 $67.80 $68.40 $72.54 99242 $97.20 $112.50 $98.80 $102.50 $117.60 $89.00 $96.70 $102.04 explain why so 99243 $118.40 $152.00 $133.30 $129.80 $145.20 $113.70 $123.60 $130.86 many physicians 99244 $147.40 $190.70 $172.00 $165.20 $175.90 $144.00 $158.90 $164.87 support a public 99245 $170.90 $207.50 $180.00 $178.90 $186.20 $161.90 $184.00 $181.34 option. In adult primary care, Medicare is often THE NEWLY ‘GENEROUS’ MEDICARE the better payer.” While private payers have pushed Our data reveal a pattern of private- their rates down, Medicare has And the Medicare edge isn’t just payer reimbursement that’s declining pushed its rates up. The result? The about dollars. Physicians experience steeply enough to make Medicare’s fewer hassles dealing with Medicare federal program that used to be a relatively low-but-stable pay rates since its payment rules are clearer reimbursement floor that everyone look pretty good by comparison. and applied more consistently, says built on — “We’ll pay you 120 perIn 2009, the federal program Madden. Plus, the agency doesn’t cent of the Medicare fee schedule” bumped up its rates for office visits rewrite the rules as frequently and ca— is becoming the ceiling. In 2008, 99213, 99214, and 99215 by 2.5 priciously as do some private payers. private plans outpaid Medicare percent, 2.7 percent, and 2.7 perThe average charge for office for all levels of established-patient cent, respectively. Reimbursement visits for new patients, established office visits except 99215. In 2009, remained essentially flat for 99212 patients, and consults decreased private payers fell below Medicare while falling 5.3 percent for the soby almost 8 percent. Physicians on 99214 as well, and the gap becalled nursing code of 99211. primarily cut their prices for newtween Medicare and private payers All in all, the feds are trying to on the other codes shrank. In 2008, patient and consult visits. bolster primary-care doctors who It might seem academic, since the the average allowable from private amount you charge isn’t the same depend heavily on these E&M payers for 99213 was 120 percent as the amount you’re paid — and codes, says Max Reiboldt, CEO of Medicare. In 2009, it slipped to you’re only in direct control of the of The Coker Group, an Atlanta107 percent. If this trend keeps up, former — but reducing charges is a based consulting firm. you’ll be lucky if payers say, “We’ll bad move, Madden says. Charges should be based on your costs, including physician compensation, she argues. “At the very least, The current economic downturn has eroded the profits of private health insurers, who in turn are lowering physician reimbursement, as seen in our 2009 Fee Schedule Survey. you need to increase your charges each year to reflect inflation.” Average reimbursement for E&M services declined by 7.3 percent, with the bellwether • 99213 falling to $65.49. It’s not clear why charges dropped in 2009. One possible While private payers trim E&M reimbursement, Medicare is upping its rates. • explanation is physician sympathy Doctors in the Mid-Atlantic were hit with the biggest drop in health-plan rates. • for patients who must foot the • Primary-care doctors suffered steeper pay cuts than medical and surgical specialists. entire bill, either because they have Layoffs mean fewer enrollees in company-sponsored plans and less premium • revenue a high-deductible insurance plan or for insurers. else lack coverage altogether. That’s To cope with shrinking third-party reimbursement, consider the following cures: no way to run a business, says • Know your contract terms cold so you can easily spot proposed pay cuts. Madden. • Write off bills for hardship cases instead of reducing your charges across the board. “If patients are struggling to • Hire a nurse practitioner or physician assistant to leverage their income-to-collections ratio. pay what they owe, physicians can always write off part of the bill, as • Streamline your operations so you can see a few extra patients per day. long as they document that it’s a Consider seeing privately-insured patients on a cash-only basis. • consults

existing PAtient Visits

New PAtient Visits

Average Commercial Reimbursement

in summary

| Physicians Practice | January 2010

www.physicianspractice.com

$138.89

$120

$109.51

$100 $90

$50 $40

$80.73

$30

$49.23

$60

$71.97

$80

$99.04

$110

$149.54

n 2009

$130

$70

$154.93

n 2008

$131.17

$140

New Patients: 2008 vs. 2009

$58.10

$20 $10 $0

$100

Existing Patients: 2008 vs. 2009 n 2008

$117.36

$110

n 2009 $97.36

$90 $80

$60

$20

$45.16

$30

$28.14

$40

$51.73

$50

$65.49

$71.67

$70

$91.37

$120

$112.69

99201 99202 99203 99204 99205

$10 $0

n 2008

$186.16

$160

Consults: 2008 vs. 2009 n 2009

$150

$140.57

$130

$114.61

$110 $100 $90 $80 $70 $60 $50

$102.04

$120

$130.86

$140

$164.87

$170

$169.00

$180

$181.34

99211 99212 99213 99214 99215

$72.54

Private payers are consistent if nothing else. In 2009, they cut reimbursement for every level of the office-visit sets for new patients, established patients, and consults. In addition, reimbursements on average declined in every region of the country, with the steepest drop in the Mid-Atlantic states, where E&M rates are now the nation’s lowest. A 99213 there came to $58.30. The least-drastic cuts occurred in the Pacific region, which also boasted the highest rates — $73.10 for a 99213, for example. Experts don’t know exactly what accounts for these geographic disparities, but they have theories. “In states like New Jersey and New York, you have a higher density of physicians, and the competition keeps reimbursement at a lower level,” says Madden. A larger number of physicians in one location means payers there can more easily play physicians against each other. Census figures buttress Madden’s argument. Four of our Mid-Atlantic states — Maryland, New York, New Jersey, and Pennsylvania — rank among the nation’s 10 highest in physicians per capita. In contrast, California, Washington, and Oregon — the three largest states in the Pacific region, the others being Alaska and Hawaii — are in the second tier of 10. For his part, Reiboldt wonders if the difference in rates reflects a greater prevalence of large-group practices in the Pacific region, which gives these doctors more negotiating clout. Doctors in the Mid-Atlantic region, he says, are more independent-minded and less likely to join a white-coated herd.

$150

$35.51

NO SAFE PLACE

$160

$86.79

hardship case,” says Madden. “But they shouldn’t move their charges downward across the board to help patients.” Payers might reasonably assume in such cases that the lower charge is your “usual and customary fee,” and seek discounts against that number.

$40 $30 $20 99241 99242 99243 99244 99245

January 2010 | Physicians Practice | 5

Cover Story

P er c ent

1 30% 2-10  51% 11-25  8% 25-50 5% 51-100 2% 101-200 1% more than 200 2% S pecialty Ty pe

P er c ent

Medical Specialty

28%

Primary Care (FP, GP, IM, OB/GYN)

46%

Surgical Specialty

15%

Other 9%

Dicing survey results by medical specialty reveals the usual lack of parity between primary-care physicians and their specialist colleagues. While all physicians took an E&M pay cut, the cuts weren’t as onerous for medical specialists (-4 percent) and surgical specialists (-3 percent) as they were for primary-care physicians (-9 percent). And overall, specialists received the highest rates. Since orthopedic surgeons, $160 $150 $140

Primary Care vs. Specialists vs. Surgeons

n Primary Care

n Medical Specialty

$130 $126.70

$120 $110

$60

$50.40

$30

$50.80

$40

$49.30

$50

$77.20

$69.60

$70

$75.40

$80

$102.00

$96.90

$90

$101.70

$100

n Surgical Specialty

$20 $10 $0

to whittle down physicians’ fees. In addition, payers in 2009 may have been reducing their costs in anticipation that healthcare reform legislation would erode future profits, says Reiboldt. “It’s a matter of positioning themselves.” HOW TO DEAL

The health plans have their strategy for tough times. What about you? It may seem too tempting to throw up your hands in frustration, but there remain strategies for mitigating the effect of the negative economic forces on your practice: Know your stuff. One essential skill is knowing what your health plan contracts actually say. Many practices don’t even recognize fee cuts when the plans enact them. “Some doctors are ignorant of what they’re paid,” says Denver-based practice-management consultant Todd Welter. It’s your business. You don’t have the luxury any longer of leaving the “money stuff” to other people. But while payer contracts may be dense with arcana, understanding what you’re getting paid is not like memorizing the phone book, says Welter. Just track reimbursement for the 20 to 30 CPT codes that represent 90 percent of your revenue. If you notice that a new contract shaves dollars off your key codes, voice your objections to the provider relations representative, who may give in, says Welter. “They’re watching for the doctors who aren’t watching the details.” Knowing your top codes cold is especially critical when health plans crow about new rates that are “on average” substantially higher than Medicare rates. Closer inspection of a private payer’s new fee schedule may reveal that the plan is lowering your 99213 to 105 percent of Medicare, but increasing some rarely used codes to 150

$151.00

Gro up Size

$158.00

P er cENT

Middle Atlantic 18% Mountain 5% New England 4% North Central 16% Pacific 14% South Central 16% South East 23%

$146.20

Region

$131.60

Total Responses: 1,027 Data Collected: 2009

cardiologists, and the like are less plentiful than internists and family physicians, they may enjoy more bargaining power with insurers. Declining reimbursements result from a trickle-down economy, with Wall Street trickling down problems on health insurers, and health insurers trickling down problems on doctors. In 2008, the nation’s Blue Cross Blue Shield companies experienced a 41 percent drop in net income, due in part to lower return on investments, according to a study by the credit-rating firm A.M. Best. This Blues song included publicly traded Wellpoint, which operates BCBS companies in 14 states. Its net income fell 25.5 percent in 2008. These troubles persisted into 2009, with Wellpoint earnings tailing off by 76 percent in the second quarter and membership declining by 1 million from 12 months before, due mostly to higher unemployment. Among the ranks of other publicly traded health insurers, income also decreased for Aetna, Coventry Health Care, and HealthNet in the second quarter, but rose nicely for Humana, UnitedHealth Group and Cigna. Still, all of the publicly traded insurers managed to post profits through the first half of 2009, and one way to stay in the black was

$138.60

Survey Stats

99201 99202 99203 99204 99205

| Physicians Practice | January 2010

www.physicianspractice.com

Cover Story n Primary Care

n Medical Specialty

n Surgical Specialty

$130 $120 $115.90

$46.90

Provide more services.

www.physicianspractice.com

exam rooms, which you might be able to correct by using your private office to handle patient visits. Some practices lower costs by hiring nurse practitioners and physician assistants, who can do 80 percent of what a primary-care physician can do, including diagnose illnesses and prescribe medications, for less than half of what a physician earns. In 2008, for example, physician assistants specializing in primary care pulled down $87,649 in compensation and brought in $246,001 in revenue, according to the Medical Group

n Primary Care

$119.90

$139.00

n Surgical Specialty

$112.90

$105.50

$95.40

$80.60

$72.40

$177.20

n Medical Specialty

$137.20

Primary Care vs. Specialists vs. Surgeons

$71.90

percent. Also beware of payers who freeze their rates by continuing to base them on last year’s Medicare fee schedule, instead of upgrading to this year’s. Understand your value. Negotiating with payers that operate like virtual monopolies in many regions isn’t a cakewalk, but it’s worth trying. They’re more likely to give you a raise, or at least not give you a haircut, if you convince them that you’re more valuable to them than rival practices. Perhaps you’re the only one who offers extended office hours, or you hew more closely to clinical guidelines for $190 a larger percentage of patients than most of your $180 colleagues. If you’ve got it, $170 flaunt it. $160 See more patients. If $150 you can’t stave off rate $140 decreases, you may be able $130 to protect your bottom $120 line through increased $110 productivity. Maybe you $100 can carve out another slot $90 or two for office visits by $80 tightly scheduling chats $70 with pharmaceutical reps, $60 or delegating more patient $50 education to an RN or $40 medical assistant. A consultant can help identify $30 logjams in your patient $20 flow, such as a shortage of

$196.70

99211 99212 99213 99214 99215

Offering ancillary services such as spirometry, EKGs, and X-ray is a traditional way to supplement waning reimbursement for E&M services. But before you buy a piece of equipment, ask yourself a question: Is this service benefiting your patients, or merely your bank account? “The temptation is to do it for every patient, whether they need it or not,” notes Madden. “That promotes overutilization.” However, you’re on safer ethical ground if you currently refer patients to a local hospital for tests and procedures that you could bring in-house, says Todd Welter. “Somebody is making money off these services,” he says. “Why shouldn’t it be the doctor?” Just be sure to run the numbers for your

$147.10

$30.70

$10

$27.80

$20

$28.10

$30

$45.60

$40

$43.80

$50

$67.80

$63.10

$60

$65.70

$70

$91.90

$86.50

$80

$93.90

$90

$107.90

$100

$117.90

$110

$186.50

$140

Management Association. In comparison, a family physician not delivering babies earned $179,672 and produced $370,011 in revenue. So one family physician’s compensation would pay for two PAs, whose combined revenue of $492,002 would top the doctor’s by 33 percent.

$163.60

$150

Primary Care vs. Specialists vs. Surgeons

$171.70

$160

99241 99242 99243 99244 99245

January 2010 | Physicians Practice | 7

Cover Story new service ahead of time to determine whether it will actually turn a profit. How much will a test or service cost in terms of equipment, supplies, and personnel? What’s your likely volume of patients? Are you certain your payers will reimburse you for it? How much? Can you delegate the actual performance of the service to lower-paid staff, or will you have to perform it personally? How much of your time will it take — and are there more profitable ways you would (or could) be spending that time? Do the math. REINVENTION

Sometimes doing the math on third-party reimbursements — more about subtraction than addition — drives physicians to consider other employment arrangements or practice models. One idea is to sell. Hospitals are in a buying mood again, and Reiboldt says more and more physicians are becoming employed, which promises a reasonably good livelihood

— but no overnight fortunes like those in the 1990s, when health systems overpaid for practices. Hospitals, he adds, have developed into more physician-friendly employers since they first started assembling regiments of MDs and DOs. However, they’ve also turned to productivity-based compensation formulas that keep physicians hustling like self-employed entrepreneurs. Another drastic survival plan is cutting your ties to private health plans and Medicare, seeing patients up for “The basis. Tech Doctor,” free on Sign a cash-only “Weastopped e-newsletter offering advice to physicians contracting with them seven years on adopting and using technology for by e-mailing us at agobetter duemanagement, to declining reimbursephysicianspractice-info@cmpmedica.com. ment,” says internist Raymond Kordonowy, a member of the four-doctor Internal Medicine of Southwest Florida in Fort Myers. “Providers should bill what their practice requires to remain profitable.” Whatever you do to counter the squeeze play of private payers, act boldly. You can’t be the doctor you were yesterday, circling 99213 on a charge ticket and waiting for a

tech troubles?

check. Says Raul Vazquez, “You have to reinvent yourself.” n Robert Lowes is an award-winning journalist who has covered the healthcare industry for 20 years. He also is a published poet with an MFA in creative writing. He can be reached via physicianspractice@ cmpmedica.com.

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physicianspractice-info@cmpmedica. Each year, Physicians Practice ranks com for more information. the payers in a report called PayerView.SM By submitting your work, you acknowledge that Physicians Practice retains all copyrights to any work it publishes. How well does your payer treat physicians? We will not publish your work without your permission. If we do publish your work, we will involve you in the editing process. Find out by searching Payerview at www.PhysiciansPractice.com. submissions due by February 5, 2010. • Must be e-mailed as an attachment • Should include your full name to writersearch@cmpmedica.com in an and contact information. • Should be 1,000 to 1,250 words editable format (such as Microsoft Word). (not including your name, essay title, etc). • Must be an original, previously No PDFs, please. unpublished, work produced by you.

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ISSUE

c pe s

TECH

2010

TECH

ISSUE

Pa y e r P e r f o r m a n c e

Exam

Payerview Reveals Payers Are Getting Better

By Robert Redling

Wouldn’t it be great if payers would own up to their part in the number of days your practice’s claims languish in account receivables? Or if you could see at a glance which payers denied more claims than the rest, and then compounded the hassles by sending back muddy explanations of their denials? 2

| Physicians Practice | June 2010

Now you can. In fact, if you’ve been reading Physicians Practice in recent years, you’d know that detailed information on payer performance has been a reality since 2006. Like its predecessors, this fifth edition of PayerView details how well or poorly national and regional payers did

in getting you paid correctly and on time for the services you performed. Using only hard claims data, PayerView is a top-to-bottom ranking of commercial payers, Medicare, and Medicaid that measures the level of “hassle factor” each payer represents. Payers judge your “performance.” Now it’s your turn to judge them on theirs. www.physicianspractice.com

mined

illustration: Dave plunkert

When the project started in 2006 in collaboration with athenahealth, the nation’s largest revenue cycle management company, the goal was twofold. First, by offering you vital intelligence (otherwise unavailable) on payer performance, you can make informed judgments about which payers you www.physicianspractice.com

want to work with. Second, we hoped that over time the publicity from PayerView would prompt competition among payers to improve. We knew that the second objective was a bit ambitious. But it’s worked. Many payers have improved performance in most of the categories PayerView mea-

sured this year. They paid claims faster and resolved more claims on the first submission. Even the sorest spots in provider-payer relationships, such as denial rates, showed improvements almost across the board. Let’s look at the numbers.

June 2010 | Physicians Practice |

Cover Story PAYERS COMPARED

What is PayerView, exactly? It’s a public ranking of 137 payers doing business in 45 states and the District of Columbia during 2009. The rankings are prepared by athenahealth and based on data from millions of claims submitted by thousands of providers, which are run through an algorithm athenahealth created that includes weighted performance metrics in key categories. Not only does the trend from 2008 to 2009 show improvement, but payers are displaying competitive levels of performance between each other. This year, PayerView introduces the all-payers comparison, which allows comparisons across all categories of payers. When all 137 payers were examined, the top performer was Blue Cross & Blue Shield of Rhode Island, where

claims averaged just 12.2 days in accounts receivable, and 98.5 percent of claims were resolved on the first pass. Close behind in the all-payer rankings was the national payer Humana. (You can see the all-payers comparison in full at PhysiciansPractice.com.) How can tiny Blue Cross of Rhode Island outperform giant national payers? By making shrewd use of electronic transactions and by streamlining the claims process. Even notoriously inefficient state Medicaid payers, perennial basement dwellers in PayerView’s rankings, took steps forward in performance, though they continue to lag behind. “It’s really become a game of who’s improving faster,” says Melissa Lukowski, director of payer outreach for athenahealth. Lukowski credits the widespread use

of electronic transaction standards in helping companies like athenahealth guide users more precisely and improve payer performance. “The payers getting to the next level in rankings are the ones who

in summary For the fifth year, PayerView ranks payers on how much, or little, hassle it is for providers to do business with them. The key findings:

Aetna, and UnitedHealth • Humana, Group were the top three performers in the “Major Payers” category.

regional payers • High-performing showed results competitive with

— and in some cases superior to — their big national rivals, which suggests that standardized transactions are leveling the playing field.

plans are placing greater • More burdens on providers to collect

patient liabilities, such as deductibles.

performance returned to • Medicare’s normal levels in 2009 after taking a hit in 2007 and 2008 while it implemented the National Provider Identifier standard.

weights& measures

What PayerView Measures Weight How it’s Measured 25%

Average time it takes to receive payment as measured from date of charge entry to remittance post

25%

Percent of claims that are successfully resolved on the initial submission (e.g. paid or deemed as patient responsibility by the payer)

Provider Collection Burden

10%

Percent of charges ($) transferred from the primary insurer to the next responsible party. Includes coinsurance, deductibles, and other transfers (e.g. noncovered services). Copays and real-time adjudication amounts were not included in the rate as information is readily known.

Denial Rate

20%

Percent of claims (both pended and denied) requiring back-end rework

Denial Transparency

10%

Percent of denied claims requiring only one resubmission to resolve the claim

10%

Correlation of eligibility response to adjudication outcome. If payer stated that the patient was eligible in its eligibility response, the payer would get penalized if it later denied the claim for eligibility-related reasons.

Days in A/R

First-Pass Resolution Rate Financial Performance

60%

Administrative Performance

30%

Transaction Efficiency

10%

| Physicians Practice | June 2010

Eligibility Accuracy

www.physicianspractice.com

Cover Story

Best

Worst

Which payer scored best on each of PayerView’s six metrics, nationwide, regardless of size or region? And which are the most in need of remedial help? The answers below.

P A Y M E N T P R O C ESSES :

WHAT’S NEXT?

Best/Worst Score

We asked executives at major payers what the future will bring to the physicians claims process. Their answer: more of the same, but faster.

BCBS — Rhode Island

12.2

Increased patient responsibility:

Medicaid — New York

112.3

First-Pass Resolution Rate

BCBS — Rhode Island

98.5%

Medicaid — Pennsylvania

69.5%

Provider Collection Burden

Phoenix Health Plan

0.2%

BCBS — Texas

28%

ODS Health Plan

Medicaid — Pennsylvania

34.2%

Metric Days in A/R

Denial Rate

Fallon 98.7% Denial Transparency

Eligibility Accuracy

Medicare — Northern Calif.

Tufts 99.7% BCBS — Oregon

fully leverage electronic transaction,” she says. “They don’t just process a claim; they keep you informed about its progress through the entire chain of eligibility, claims status inquiry, and electronic remittance.” KEY MEASURES

How, exactly, does PayerView work? Each payer is judged on how well it performs in certain areas that are important to physician practices — average days that a claim spends in accounts receivable (A/R), for example, or the rate at which it denies claims outright. The payer’s performance in all categories is tallied by the data crunchers at athenahealth to get a final score, which is then used to rank the payers against each other. Some notes: First, because some categories are more important to practices than others, the categories are weighted when athenahealth tallies up the final scores. (The details of what’s measured and www.physicianspractice.com

40.8%

23.1%

how much each metric counts toward the final score are explained in the table “Weights and Measures.”) Second, athenahealth does not report the final score itself. It reports only the rankings and the payers’ performance on each individual metric. Third, because PayerView data comes only from physicians using athenahealth for billing, it’s not a complete picture of each payer’s network. In fact, payers generally perform better inside athenahealth’s system than outside of it, due to the various steps athenahealth takes to facilitate payment — that is its business, after all — so we can’t say for sure that PayerView performance is precisely reflective of a payer’s performance generally. Still, PayerView contains so much data that we consider it a representative sample. Working in nearly every state, athenahealth’s data represent more than 39 million charges worth $7 billion from more than 22,000 providers in 2009.

“There will be more high deductibles and coinsurance in plans,” says Mark Smithson, a service vice president with Humana. “Providers can respond by building their work flow around a more retail-like environment for collections — real-time adjudication, in other words.” New rules and standards, like EHR data standards and upcoming rules for meaningful use, will serve as change agents for payers and providers, says Tim Kaja, senior vice president of physician and hospital service operations for UnitedHealthcare. “Physicians will be increasingly reimbursed based on clinical and administrative quality data,” Kaja says. “If we don’t get to full transparency now with physicians with the existing claim process, it’s going to be very hard for the industry when we start paying for outcomes based on quality data.” Increased transparency in the claims process. Paul Marchetti,

head of Aetna’s national network and contracting services, says his company’s efforts to integrate claims status inquiries into billing applications like athena’s is part of an industry trend toward claimsprocess transparency. “Aetna has cut denials down to the point where from here on out the improvements will be incremental,” Marchetti says. “We will continue providing transparency into the billing process so when a physician’s office posts a claim, they will have a clear line of sight to where that claim is at all times.” June 2010 | Physicians Practice |

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P R O G R A M

| Physicians Practice | June 2010

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Cover Story Fourth, to keep the calculations fair, athenahealth imposes some limitations on what it will include. Only payers on which athenahealth has a minimum of 3,500 claims per quarter for at least six physician practices were included in PayerView. Also, if any single athenahealth client contributed a disproportionate percentage of a payer’s claims, those claims were removed from the calculations. That exclusion may in turn have eliminated some payers from PayerView if there weren’t enough claims remaining to meet the 3,500 minimum. The metrics included in PayerView were adjusted this year, too. Added was a measure gauging accuracy in determining insurance eligibility. Removed were measures on payers’ compliance with Medicare’s Correct Coding Initiative, and rates of claims kicked back with requests for documentation. A metric showing the percentage of patient liability by payer

was revised to measure “provider collection burden,” and was given more weight in the scoring. This metric now shows the percentage of charges transferred from the primary insurer to the next responsible party, such as the patient. MAJOR PAYERS

When the eight national payers were compared, Humana scored a repeat appearance in the top spot. It led in fewest days in A/R (22.4) and was highest in claim denial transparency (96 percent), which measures how many denied claims required only one resubmission to get paid, indicating how well a payer explains its denials. Sparking Humana’s performance, in part, was its ability to resolve claims in real time. Humana, as well as UnitedHealth Group, has integrated real-time claims adjudication with athenahealth’s system. Physicians who use this process get a determination of a patient’s liability

R e a d y f or 5010 in 2012? The HIPAA-mandated standards for electronic transmission of healthcare transactions implemented in 2003 are poised to take another big step soon. Next year, everything from claims and remittances to eligibility and status requests between providers and most payers will move to the Version 5010 standard, which aims to resolve gaps in the current standard. As an example of where the current standard falls short, take a look at the current state of electronic remittance advice. It directly affects your ability to manage denials — that is, to understand why a claim was denied or adjusted. Melissa Lukowski, director of payer outreach for athenahealth, says many payers had difficulty converting from their proprietary remittance explanation codes to the standard HIPAA adjustment and remark code sets. “Everyone’s struggled with it, especially the Medicaids, which had a very high level of specificity in their former, proprietary code sets,” Lukowski says. Cloudy remittance advice means your staff must spend more time calling the insurance plan’s provider line or signing on to a Web portal. These extra efforts to resolve pesky denials can also introduce paper or nonstandardized information into the claims process. Physician offices may have to, or feel they should, send in portions of the patient’s record or other forms on paper to get the claim paid. Indeed, this year’s PayerView report indicates that a fully electronic claims process — from initial claims submission to the transfer of payments to the physician’s account — shaves up to eight days from the claims cycle, with a similar reduction of average days in A/R. www.physicianspractice.com

within seconds of submitting a claim, and can collect what the patient owes immediately instead of waiting weeks for a final determination. Mark Smithson, a service vice president with Humana, explains that real-time adjudication produces real savings for physician practices: It reduces days in A/R and saves staff time, postage, and other collection costs. It also leads to fewer bad debt write-offs as many practices eventually give up trying to collect from patients who are reluctant to pay. “We try to get providers to change their work flows a bit to make sure they are coding and submitting that claim while the patient is in the office,” Smithson says. MEDICARE AND MEDICAID

Medicare’s development of the National Provider Identifier standard in 2007 and 2008 probably hurt its PayerView performance in those years, according to athenahealth’s analysis. But with that process mostly behind it, Medicare made solid performance gains in 2009. The program averaged declines of 24 percent in A/R days and 25 percent in denial rates while leading all payers with an eligibility accuracy rate of about 99 percent. Even Medicaid programs, traditionally the lowest performing

the Not finding your payers listed in these pages? We have dozens more listed at Physicians Practice.com. Included here are rankings for the national payers and the top five in each region, plus the top five Blue Cross, Medicare, and Medicaid plans. At PhysiciansPractice.com, you’ll find data on all 137 payers in the PayerView database, plus expanded coverage and analysis of what it all means. June 2010 | Physicians Practice |

Cover Story payers (see table “Best & Worst”), marked an 18 percent decrease in A/R days. Lukowski credits the improvements to increased efficiency and transparency stemming from the spread of standardized transactions. Many Medicaid plans also reduced rates of denied claims. “They are dealing with complex rules and specific eligibility information,” Lukowski says. “It’s not just, ‘Is this patient eligible?’ but ‘Is the pa-

tient eligible for this particular service at this time, with this provider?’” PHYSICIANS AND PAYERS

Can the improvements seen in many of the PayerView categories continue? Yes, but more work needs to be done by physician offices, says Rosemarie Nelson, who consults with medical practices on technology-related issues for the Medical Group Management Association.

“Before you point your finger at the payer, ask if you are posting 95 percent of your claims electronically, because that’s what the better-performing medical practices do — and it works,” she says. Nelson’s prescription for the electronically empowered medical practice goes beyond equipment. She suggests asking yourself these questions about your practice:

22.4

0.964

0.048

2. Aetna 3. UnitedHealth Group

25.4 27.4

2 7

0.97 0.961

1 5

0.055 0.058

3 4

4. Champus/Tricare 5. Wellpoint

26.3 27.2

4 6

0.939 0.958

8 6

0.069 0.072

6 7

1. BCBS-RI

12.2

0.985

0.037

2. BCBS-MA 3. Tufts

19.6 28.9

2 18

0.961 0.953

3 10

0.064 0.044

16 4

4. Aetna & Aetna/US Healthcare 5. UnitedHealthcare

22.9 26.1

6 13

0.967 0.961

2 3

0.054 0.06

9 12

1. UnitedHealthcare

24.2

0.972

0.047

2. Humana 3. Medicare B-GA

22.7 23.2

5 8

0.966 0.972

6 2

0.055 0.038

11 1

4. Medicare B-NC 5. BCBS-NC

20.5 17.9

2 1

0.971 0.947

4 19

0.046 0.046

3 3

west

1. 2. 3. 4. 5.

Humana UnitedHealthcare Medicare B-OR ODS Health Plan Aetna & Aetna/US Healthcare

24 28.3 24.4 25.9 29.4

6 16 7 9 19

0.966 0.964 0.968 0.97 0.968

5 6 2 1 2

0.047 0.054 0.04 0.03 0.053

6 10 2 1 9

midwest

1. 2. 3. 4. 5.

Humana UnitedHealthcare BCBS-OH Aetna & Aetna/US Healthcare Paramount Health Care

20.9 24.4 23.5 24.2 38.8

1 6 3 5 15

0.961 0.966 0.974 0.973 0.976

8 5 2 3 1

0.044 0.049 0.046 0.048 0.042

3 6 4 5 2

medicare-b

1. 2. 3. 4. 5.

Medicare B-GA Medicare B-NC Medicare B-OR Medicare B-MS Medicare B-TN

23.2 20.5 24.4 23.1 23

9 2 12 8 7

0.972 0.971 0.968 0.959 0.963

1 2 3 8 4

0.038 0.046 0.04 0.046 0.065

1 5 2 5 17

medicaid

1. 2. 3. 4. 5.

Medicaid-IL Medicaid-MS Medicaid-OH Medicaid-LA Medicaid-NC

55.3 34.3 42.4 39.5 37.1

7 1 4 3 2

0.924 0.847 0.86 0.831 0.843

1 3 2 6 4

0.099 0.095 0.168 0.181 0.221

3 2 4 5 8

1. 2. 3. 4. 5.

BCBS-RI BCBS-MA BCBS-OH BCBS-NC BCBS-PA Capital Blue Cross

12.2 19.6 23.5 17.9 19.6

1 3 10 2 3

0.985 0.961 0.974 0.947 0.957

1 6 2 16 11

0.037 0.064 0.046 0.046 0.062

1 8 2 2 6

South

Northeast

National

1. Humana

Blues

First-Pass PAYER Days in A/R Rank Rank Denial Rate Rank De Resolution Rate

| Physicians Practice | June 2010

www.physicianspractice.com

• Staff training: Is your front-office staff trained to be part of the revenue cycle team along with your business office?

• Billing: Does your staff take time to set up every payer electronically — even your smaller payers? • Clearinghouses: Do you make good use of the information and services your clearinghouse provides, even if it costs a little extra?

• Staff deployment: Has your practice’s check-out function moved from the cashier-at-acounter model to a desk staffed by a “financial advocate” who completes real-time adjudication and collections?

• Claims: Do you submit claims every day? “Sending claims in once or twice a week is old school,” Nelson says. n

k Denial Transparency Rank e

Provider Collection Rank Burden

Robert Redling is a freelance writer based in Tacoma, Wash. He has been practice management editor for Physicians Practice, Web content editor and senior writer for the Medical Group Management Association, and a speechwriter for the American Academy of Family Physicians. He can be reached via physicians practice@cmpmedica.com.

Eligibility Accuracy Rank

0.96

0.12

0.989

0.861 0.932

6 2

0.119 0.11

3 2

0.979 0.983

5 4

0.832 0.886

8 4

0.085 0.137

1 5

0.987 0.952

3 7

0.85

0.035

0.97

0.942 0.951

6 4

0.059 0.028

22 14

0.983 0.997

12 1

0.866 0.964

24 3

0.074 0.099

26 32

0.975 0.983

15 12

0.984

0.125

0.986

0.948 0.852

2 20

0.096 0.224

16 37

0.99 0.995

12 1

0.868 0.933

17 3

0.231 0.158

40 25

0.99 0.972

12 25

0.971 0.979 0.91 0.854 0.864

3 1 11 25 22

0.157 0.124 0.237 0.148 0.123

17 14 31 16 13

0.992 0.983 0.991 0 0.982

2 11 5 0 12

0.965 0.987 0.972 0.887 0.905

5 1 3 12 11

0.119 0.12 0.129 0.117 0.03

10 0.988 11 0.99 12 0.962 9 0.976 5

5 3 13 11

0.852 0.868 0.91 0.896 0.906

19 15 7 10 8

0.224 0.231 0.237 0.244 0.238

7 14 18 26 19

0.995 0.99 0.991 0.995 0.991

1 17 9 1 9

0.845 0.839 0.82 0.786 0.702

1 2 4 5 9

0.023 0.025 0.035 0.009 0.012

5 7 9 2 3

0.993 0.993 0.948 0.991 0.97

1 1 11 3 8

0.85 0.942 0.972 0.933 0.782

24 7 2 10 33

0.035 0.059 0.129 0.158 0.09

2 4 15 20 8

0.97 0.983 0.962 0.972 0.979

9 1 15 5 3

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June 2010 | Physicians Practice |

Compensation Upsand

Downs

TAKE OUR PHYSICIAN COMPENSATION SURVEY FOR A CHANCE TO WIN $500 How confident are you that you are making enough money? Let us help you answer this question. Just fill out our easy survey, bit.ly/PCS-survey, and be entered in a drawing to win a $500 VISA gift card. Then, look for the results in an upcoming issue of Physicians Practice. Scan this box with a QR reader on your mobile device or visit: www.physicianspractice.com. Survey ends July 6, 2015; no purchase necessary.

Brought to you by

your hospital September 2010

He wants

YOU to buy an ehr But will you take his money to do it? Our annual Tech Survey has the answer.

also inside: THE BEST STATES TO PRACTICE: OUR STATEBY-STATE GUIDE ICD-10 TRANSITION: WORRIED? WE’VE GOT YOU COVERED PHYSICIAN BEWARE: ‘OOPS, I HIRED A NIGHTMARE EMPLOYEE’

CME ONLINE instructions/40

2010 Technology Survey

Uncle Samâ&#x20AC;&#x2122;s

EHR

Incentives: Government seeks to jumpstart stalled adoption, but docs remain leery, survey finds

illustration: Douglas Jones

By Bob Redling

| Physicians Practice | September 2010

www.physicianspractice.com

ant to avoid an expensive misstep when shopping for an EHR? Look for unbiased advice and go with your gut, says Deanna Attai. The Burbank, Calif., breast surgeon says she didn’t know that the EHR vendor she selected had paid for its glowing references. Worse, she didn’t follow her instincts. She has spent an additional $30,000 so far replacing that feature-rich system that never panned out. Attai has a different system today but also more wisdom. “I should have listened more to my gut and not been distracted by the bells and whistles they promised but didn’t deliver,” she says. With the government now offering cash incentives for implementing an EHR, many physicians who’d long held out have had their interest piqued, even as others remain skeptical, according to the 2010 Physicians Practice Technology Survey. More than half (57 percent) of the 597 respondents to our sur-

in summary More than half of respondents to the 2010 Physicians Practice Technology Survey told us that the federal government’s Medicare and Medicaid EHR incentives have them shopping for a system. If that’s you, or you already have an EHR, here’s what’s needed to get the promised reimbursement bonuses: Use an EHR that meets standards and certification criteria set by the Office of the National Coordinator for Health Information Technology (ONC). Meet CMS’s 15 mandatory requirements (14 for hospitals) for meaningful use during 2011 and 2012 (and 2010 if starting early). Select at least five additional measures from the 10 provided by CMS. Prepare for criteria to expand in 2013 and subsequent years of the program. Stick with the program for the full five years (Medicare) or six years (Medicaid) to earn the full reimbursement bonuses. Start now looking into systems, vendors, and sources of expert help because thousands of other physicians may also be EHR shopping.

• • • • • •

www.physicianspractice.com

vey told us that the Medicare and Medicaid-based incentive programs set to launch in 2011 make them more likely to buy an EHR. Getting cash from the federal government to defray the cost of an expensive purchase sounds appetizing. But like most lunches, this one really isn’t free; Uncle Sam isn’t offering to take you EHR shopping. Only after practices front the money to buy a “certified” system and follow the just-finalized rules for demonstrating that they are meaningfully using it can they seek federal stimulus dollars. And these facts have most physicians still puzzling over how the whole program will work. We’ll help sort that out as we take a closer look at this year’s technology survey results. THE HITECH ACT

First, some recent history. The EHR incentive program was created by the Health Information Technology for Economic and Clinical Health Act (HITECH Act), part of the federal stimulus package signed by President Obama in 2009. The legislation provides incentives to each physician (and certain other providers) who meet HITECH’s requirements. You can participate in the Medicare or the Medicaid incentive program, but not both. Switching between incentive programs after you start is allowed, but only once. The legislation sets four objectives for physicians to get the stimulus money. You must: • Use certified EHR technology in a meaningful way; • Utilize electronic prescribing; • Use a system that electronically exchanges health information to improve the quality of care; and • Submit information about clinical quality and other measures. To meet that first bullet, the Centers for Medicare and Medicaid Services (CMS) set 15 mandatory requirements for eligible providers (and 14 for hospitals) to meet in 2011 and 2012. Eligible providers and hospitals also must meet at least five additional measures of their

choosing from a menu of 10 requirements. CMS plans to raise the bar by adding more criteria in subsequent years of the bonus program. INCENTIVES OVER TIME

About 40 percent of office-based physicians are already using fully integrated EHR systems, according to our survey. A 2009 survey conducted by the Centers for Disease Control and Prevention found similar numbers, although other estimates put the number of EHR adopters lower. One problem is that EHR adoption seems to have stalled: our first Technology Survey in 2005, for example, found the same 40 percent rate. The bonus payments to physicians and hospitals are seen

My Practice:

39.9%

22.3% 16.1%

7.9%

13.8%

n Has a fully implemented EHR n Plans to buy an EHR within the next 12 months n Has selected an EHR but not yet fully implemented it n Does not plan to buy an EHR n Uses an EHR selected and provided by the hospital

Fully Implemented EHR: 2007-2010 45% 40% 35%

40%

39% 35%

35.7% 30% 25% 20% 15%

2007 2008 2009 2010

September 2010 | Physicians Practice |

2010 Technology Survey

| Physicians Practice | September 2010

Information Technology (ONC), which is handling the certification process, compiled a helpful, user-friendly chart for the New England Journal of Medicine that contains the full list of mandated and elective criteria: http:// healthcarereform.nejm.org/. The rule calls for attesting in writing to using your EHR to those capabilities for at least a 90-day period if you start during 2011 and for a full year if you start in 2012 or later. Plus you’ll need to submit quality data electronically. Seems reasonable. Or is it? If you aren’t close to purchasing your EHR now, consider this: 40 percent of our survey’s respondents said they spent four months to a full year shopping for the right EHR — and one in four spent more than a year. And that’s just getting to the purchase decision.

If you have an EHR, have you seen or do you expect to see a return on investment?

More than half (56 percent) of you said it took six months to a year to complete implementation, while one in 10 needed up to 18 months. Do the math from today and it could be a challenge to hit all of the required CMS targets for meaningful use by the end of 2011. “The problem with setting these across-the-board thresholds is that the government is requiring the eligible provider to rely on the cooperation of a third party,” says Robert Tennant, senior policy adviser for the Medical Group Management Association. For example, the proposed rules would have required that 75 percent of physicians’ prescriptions be generated

Would you say your EHR has made your practice’s work flow more efficient overall?

71.4% 12.8% 63.9%

15.8% 36.1% n Yes n No, it’s worse n Yes n No

If you already use an EHR, how long did it take you to complete implementation?

33.7%

22.2%

n It’s about the same as it was

If your practice has an EHR, how did the EHR affect total staffing?

10.7%

58.6%

16.5% 6.1%

as necessary to jumpstart EHR systems, which in turn is seen as crucial to moving Americans into a system of care that’s comprehensive and, eventually, cheaper. Medicare offers physicians a bonus of up to $44,000 paid over a five-year period starting in 2011 (a separate program for hospitals begins Oct. 1, 2010). The payments are tied to 75 percent of your annual allowed Medicare Part B charges that year. If you start in 2011 or 2012, you can capture the maximum $18,000 bonus in your first year of participation by billing at least $24,000 in Medicare allowed charges. Participation in the bonus program ends in 2015, so waiting until 2013 to begin drops your cumulative take to $39,000, and to $24,000 if you start in 2014. The Medicaid bonuses are geared to patient volume and there’s no penalty for not participating. At least 30 percent or more of your patient volume must be Medicaid beneficiaries (but only 20 percent for pediatricians) measured over any continuous 90-day period in the program’s first calendar year. Eligible professionals for Medicaid bonuses include nurse practitioners, certified nurse-midwives and some physician assistants such as those working in rural health clinics or provider shortage areas. For both programs, CMS will make bonus payments to each eligible professional in your practice. In other words, a group of three internists could receive $132,000 in total if each successfully participates in the Medicare program. But can they get there in time? To earn the bonuses, you’ll first need to meet the criteria set by CMS — from maintaining medication and allergy medication lists electronically for the majority of your patients (from all payers, not just Medicare and Medicaid) to providing patients with electronic copies of their health records upon request. Find the full criteria and other rules on the CMS Web site at: www.cms.gov/EHRIncentivePrograms/. David Blumenthal, MD, director of the Office of the National Coordinator for Health

10.3%

9.6%

11.1%

n Up to a month n Up to 6 months n 7-12 months n 13-18 months n 19-24 months n More than 2 years

21.1%

n We laid off staff n We moved staff to new positions n We kept staffing levels the same n We had to add staff to manage the EHR

www.physicianspractice.com

and transmitted electronically. Tennant complained that such a high hurdle “could be a problem when practices deal with small pharmacies that haven’t set up e-prescribing, or with patients who want paper scripts because they don’t have a “regular pharmacy.” Other physicians’ advocates voiced similar complaints. The final rule, released in mid-July, lowers the e-prescribing threshold to 40 percent. Many observers have recalled the CMS’s pay-for-performance program, called the Physician Quality Reporting Initiative (PQRI), as an example

Does your practice management software do everything you want it to do?

54.5%

45.5%

n Yes n No

If no, what more do you need? 100%

In general what impact is the recession having on your technology purchasing decisions?

To qualify for the Medicare and Medicaid bonuses, your EHR system must be certified. In June, Blumenthal announced a plan for one or more organizations to certify EHRs, or individual EHR modules, such as e-prescribing software, under the HITECH Act. Certification is a critical element both to new EHR purchasers and current system owners. While the legislation permits you to obtain stimulus funds for any certified system you use, even if you purchased, implemented, and paid for it years ago, your software must be certified under the new meaningful use criteria. ONC will post on its Web site all certified software products that qualify their users for the incentives.

Less expensive upgrades

18.8%

22.4%

15.8% n We are putting off purchases

Other

www.physicianspractice.com

14.5%

65.4%

17.3%

31.2%

10%

62.3%

20%

The government has released rules governing eligibility for reimbursement. Do you feel you understand the rules?

EXISTING SYSTEMS CAN QUALIFY

25%

36.2%

30%

“If the bonus is the only reason you are moving to an EHR, you’re probably going to fail. Think about the extra value of EHR in transforming your practice, both on the clinical side and on the administrative side to reduce costs and increase revenue.”

38.2%

Fewer crashes

40%

55.8%

50%

18.5%

60%

Better reporting

70%

Better interpretation

80%

More intuitive interface

90%

of how a well-intentioned program can ensnare physicians in unfair rules that prevent doctors who participated in good faith from receiving the promised bonus in a timely fashion. The PQRI program promised bonus money to doctors who reported certain quality data correctly, but CMS did not deliver first-year results to many participating physicians until well into the next reporting year, too late for them to adjust their reporting and qualify for the incentives. Many failed to receive the promised bonuses while payments to others were delayed. “Yes, the financial incentives are significant,” says Tennant, “but there are a lot of hoops to jump through and, remember, this is spread out across five years with the requirements steadily increasing.” Indeed, two-thirds of you told us in the survey that the proposed EHR reporting criteria are confusing and you don’t expect to get the money. Instead of a big haul, consider funds from the government’s reimbursement incentive a sweetener for making a transition you will probably have to do sooner or later, Tennant says.

n No, the rules are confusing and I’m not sure I’ll really get the money that’s been promised n Yes, the rules make sense to me and I’m confident we’ll get reimbursed n No, the rules are confusing, but I’m not too worried about it

n None n It all depends on whether the vendor can prove the product will make us money n We know we need to run a tighter ship so actually are planning to spend more or invest faster than previously

September 2010 | Physicians Practice |

2010 Technology Survey Vendors are moving fast: In order to meet the Jan. 1, 2011, program starting date, they must reconfigure their systems to conform with the meaningful use criteria, achieve certification, and install or upgrade the systems at customers’ offices by the end of 2010. Even those who purchased advanced systems from solid companies are finding out that, sometimes, well, stuff happens. Just ask

Are you more likely to purchase an EHR now that the federal government is offering economic incentives to help defray the purchase price?

57.2%

Boca Raton, Fla., internist Steven Reznick. Five years ago, Reznick and his practice partner picked the most advanced EHR they could afford from the most solid company they could locate. They forked over some $60,000 to buy software, hardware, and pay for training and maintenance packages. A few years later, surprise: the company was purchased by a larger firm that will discontinue support for Reznick’s software at the end of 2011. The cost of migrating to the new system will be about $10,000. “I’m 60 years old. I have a small practice and hope to practice another 10 years, but if I didn’t already have an electronic health record, would I want to invest a large amount of money … today?” he said. “Probably not.” RETURN ON INVESTMENT?

42.8%

n Yes, I’m more likely to buy one n No, I’m no more likely to buy an EHR than I was before

When did you buy the practice management software you are currently using?

Nearly two-thirds of you (64 percent) said you expect a return on investment from your EHR purchase, or already have received one. Reznick and Attai are confident they are seeing the benefits in their practices, even with the vendor problems they’ve experienced.

In your office, how do technology decisions get made?

34.2%

29.7%

10.1% 16.2%

9.8%

32.8%

11.3% 11.9%

n Less than 1 year ago n Between 1 year and 4 years ago n More than 4 years ago, less than 10 n More than 10 years ago n Do not use practice management software 22

| Physicians Practice | September 2010

n Physicians decide to invest and select products n Managers present ideas for investment and present product options to physicians n Physicians decide to invest and managers present products to pick from n Managers decide up to a certain price point n Other

Read More About it Need more information about EHR adoption and the rules of the government’s EHR stimulus program? Check out these additional sources: list of the 15 mandated • Ameaningful use criteria, and the

“menu” of 10 criteria from which physicians must select five: http://healthcarereform.nejm.org/

fact sheets and FAQs • Technical about CMS’s incentive programs:

34.1% 9.9%

Measuring the return won’t be easy, says Paul Solverson, management consultant partner with Affiliated Computer Services, Inc., a Xerox Company. “At the end of the day, physicians are going to have spend at least as much as they are going to get from these reimbursement incentives,” Solverson says. “The ones who get the most out of an EHR will be the ones who embrace this as a positive change, not something they have to do to avoid a penalty.” Solverson says that when measuring the ROI, the biggest wild card is figuring the costs and benefits of changing work flow necessary for a successful implementation. “It’s difficult to pinpoint a single, best-practice, work flow change that happens with EHR but it’s safe to say that the more you can implement the technology for real-time use, the better the outcome,” he explains. A whopping 71 percent of our survey respondents said they expected work flow improvements as a result of implementing an EHR.

www.cms.gov/EHRIncentive Programs/

technical fact sheet on ONC’s • Astandards and certification criteria final rule: http://healthit.hhs. gov/standardsandcertification

fact sheet about the HITECH • ARegional Extension Program:

www.hhs.gov/recovery/programs/ hitech/factsheet.html

list of Health Information • ATechnology Regional Extension

Centers (RECs): http://healthit. hhs.gov/

Survey on EHR adoption: • CDC www.healthcareitnews.com/ news/survey-finds-4-10doctors-use-ehr

www.physicianspractice.com

Gina Tucker, administrator of Hampshire OB-GYN in Northampton, Mass., says she has proof of those improvements. As an early adopter of EHR back in 2004, the practice of five physicians, five NPs, and a nursemidwife now achieves every aspect of the clinical and administrative activity needed to complete a patient visit — even a coding review and CPT-to-ICD matching — by the time the patient leaves the office.

Which description most closely matches your EHR? 39.8% 7.8%

37.5%

14.9%

n Documents visits, manages e-prescribing, has a current list of meds and problems, fully interfaced with practice management system

That level of integration wasn’t entirely due to the Hampshire EHR’s smooth interface with a practice management system, though that helps. What it took was a willingness to re-examine protocols for every activity, from documenting phone calls to sending laboratory orders. “It is a big upheaval in one sense but we looked at it as a way to improve the practice and improve patient safety,” Tucker says. “You need people who are willing to accept that the way they’ve done things is going to change.” Solverson recommends getting an office administrator and a key clinician, such as a nursing supervisor, to work with the physicians to analyze how the EHR will change work flow. Practice leaders must also take the lead in designing an implementation plan that could include, sometimes, breaking down walls between office functions that traditionally stand separate, such as the billing office and the front desk.

So what’s a physician to do? Steven Lazarus, president and founder of the Boundary Information Group of consultants in Denver, suggests accelerating your education about EHR. “Don’t waste time getting started if you know it is something you want to do,” Lazarus says. “You will run out of time to qualify for bonuses and finding outside help will be harder if everyone else is asking at the same time.” Lazarus suggests: • Read up. Books, magazines, white papers, and reports from government, nonprofit organizations, and private sector companies are out there to help novices and experts alike. • Get educated. The HITECH Act funds 60 federally designated Healthcare Information Technology Regional Extension Centers (RECs) across the nation. These centers will provide no-cost and low-cost seminars, summits, online education, and technical advice to help physicians quickly implement and become adept users of EHR. See a list of all 60 centers online at: https:// healthit.hhs.gov.

the

n Documents visits, manages e-prescribing, has a current list of meds and problems, fully interfaced with practice management system, includes clinical guidelines

Why are practices shunning voice recognition software? Why are Web sites more the norm than the exception? Find the answers to these questions and other data from our 2010 Technology Survey online (www.physicianspractice. com/technology-survey).

n Documents visits, manages e-prescribing, has a current list of meds and problems n Simply documents visits

• Examine vendors. Lazarus suggests looking for vendors with good track records on customer surveys and adequate capacity to handle a big influx of new customers.

About how much did you pay or what do you expect to pay for an EHR, per physician, just for software — exclude hardware?

www.physicianspractice.com

More than $12,000 24.3%

$11,000–$12,000 5.5%

$9,000–$10,000 12.6%

4.2% $8,000–$9,000

3.8% $7,000–$8,000

2.6% $6,000–$7,000

$5,000–$6,000 6.7%

$4,000–$5,000

$3,000–$4,000 4.5%

7.9%

$2,000–$3,000 4.7%

3.4% $1,000–$2,000

$500–$3,000

10%

9.1%

15%

10.7%

20%

Less than $500 per physician

25%

• Look for help soon. Hiring qualified technical help, whether it’s a new staff member or a consultant, will be harder if thousands of other medical practices are doing the same thing at the same time as you. • Give incentives and seek penalties. With good help in short supply, and a likely sellers’ market for EHR, Lazarus suggests writing financial

September 2010 | Physicians Practice |

2010 Technology Survey incentives into contracts with vendors: promise them a small bonus for a successful implementation, but also seek a similar-sized penalty if they let you down.

licensing clauses, limitations, and other unique aspects of an EHR agreement, Lazarus says. Worried about the Medicare or Medicaid reimbursement penalty

Practices still using old-fashioned paper will become the analog outsider and experience a significant competitive disadvantage in the world of digital medical communications.

The Future

• Be aware and beware. Get a knowledgeable technology attorney to review any agreements with a vendor. Your general legal counsel may not have the expertise needed to review software

you’ll suffer if you don’t hit the government’s EHR targets? Sit down and figure out what a maximum 3 percent penalty on your Medicare income comes out to in dollars. Then run the numbers at

MEDICAL TRANSCRIPTION

5 percent, which is what HITECH allows the government to remove from Medicare reimbursement starting in 2019. Maybe there’s no need to panic. In the long run, practices still using old-fashioned paper will become the analog outsider and experience a significant competitive disadvantage in the world of digital medical communications. So it’s time to get moving on your EHR transition, if you haven’t already. You should not rush. But you should hurry. n Bob Redling is a freelance writer based in Tacoma, Wash. He has been practice management editor for Physicians Practice, Web content editor and senior writer for the Medical Group Management Association, and a speechwriter for the American Academy of Family Physicians. He can be reached via physicians practice@cmpmedica.com.

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What You’re

HOW YOU’RE COPING

also inside:

TECHNOLOGY: THERE’S AN APP FOR THAT PHYSICIAN Beware: FACING BILLING AUDITS Billing & Collections: Modifiers Explained

WhatYou’re

Happy but worried, HOW physicians are YOU’RE American through the many COPING sorting changes their profession is

By Shelly K. Schwartz

| Physicians Practice | OCTOBER 2010

seeing, and wondering: What’s next?

www.physicianspractice.com illustration: Phil Foster

You like being a doctor, for the most part, though you feel its frustrations. You don’t mind hard work and enjoy caring for patients, but you work more than you should, and wish you had more time for loved ones. You’re happy. But you’re nervous about the future of your profession — scared, even. How will physicians be paid 10 years from now? And by whom? Will all doctors be employed by hospitals, institutions, and the government, or is there still a role for the physician entrepreneur? And what about the battered primary-care physician? Will there even be such a thing, or will virtually all primary care be delivered by cheaper midlevel providers? Richard Sutton, a psychiatrist who started practicing in 1970 and now runs an ambulatory care center in

www.physicianspractice.com

Falls Church, Va., is fretful. “The future is not [as] bright for medicine as it has been over the last quarter of a century,” he says, “I think physicians will be replaced by midlevel practitioners because of economics.” Still, you maintain a better work-life balance than many might suppose, and you’re pretty content overall with your career. Despite the challenges facing physicians today, you wouldn’t advise your children to run screaming from the profession. “I love what I do and can’t imagine doing anything else,” says Deanna Attai, a breast surgeon and solo practitioner at the Center for Breast Care in Burbank, Calif. Does all this sound like you? Then congratulations: You are a perfectly ordinary American doctor. And that’s a pretty darn good thing

to be, according to the results of our second annual Great American Physician Survey, which is perhaps the most wide-ranging survey of physician attitudes, lifestyles, politics, and general well-being in the world. More than 1,400 physicians this year answered our dozens of questions about what they’re thinking, how they’re feeling, and how they’re living. The bottom line: despite the image of the overworked, overstressed, at-the-end-of-his-rope physician presented by the media, the truth is that most modern doctors wouldn’t want to be anything else. You’re fearful, maybe, but not regretful. Let’s dive into the numbers.

OCTOBER 2010 | Physicians Practice |

Male: 63.3% 29.3%

Female: 36.7%

19.8% 18.9% 2.3% 39.7% n Northeast 29.5% 11.8%

n Southeast n West

14%

n Midwest

2.6% 10.3%

14.1% 25%

28.2%

n An employed physician of a hospital or other institution n A partner/co-owner of a private practice n An employed physician in a private practice n Working in a clinical setting that is not identified above n Retired

My region

I am

n South

n Employed in a nonclinical profession (for example, as an administrator) 20.9%

15.8% 12.7%

41.9%

n 46-55 years old n 56-64 years old n 65 or older

n No other physicians; I work solo n Between 2 and 5 physicians n Between 6 and 10 physicians

44.7%

n 36-45 years old

I am a

Including me, my practice/ institution has

n 35 years old or younger

13.4%

Specialist: 51.6%

n Between 11 and 20 physicians n Between 21 and 50 physicians n Between 51 and 100 physicians

Primary-Care Physician: 48.4%

My location

29.8%

My age

3.9%

7.9%

20.2%

11.8%

My gender

More than 1,400 physicians completed this yearâ&#x20AC;&#x2122;s 1 Great American Physician Survey, with respondents largely mirroring the demographics of U.S. physicians generally. About half the respondents were in primary care; the other half specialists. The male/ female split was about 60/40. Physicians of all generations are well represented, with a nearly even split among age groups, as were doctors from urban, suburban, and rural locations from every part of the country and in 22.4% every type of practice â&#x20AC;&#x201D; large group, small group, and solo.

n Urban n Suburban n Rural

n More than 100 physicians Shelly K. Schwartz, a freelance writer in Maplewood, N.J., has covered personal finance, technology, and healthcare for more than 12 years. Her work has appeared on CNNMoney.com, Bankrate.com, and Healthy Family magazine. She can be reached via editor@physicianspractice.com. Bob Keaveney,

the editorial director of Physicians Practice, contributed to this article.

| Physicians Practice | OCTOBER 2010

www.physicianspractice.com

Even as you express general contentedness with your career, you’re also revealing signs of worry about the future. Nearly half of you think primary-care docs will 1 eventually go the way of the T-Rex, replaced by cheaper nonphysician providers, while even more expect big fundamental changes in the way docs get paid. More than a quarter of you have been sued for malpractice, and defensive medicine is rampant: 73 percent of you admit to having practiced it. Meanwhile, you’re noticing effects the recession has had on your patients, who are trying to save money by seeing you less often and not following up on treatment. And many of you are skipping vacations and altering retirement plans as you tighten your own belts.

Have you ever been sued or threatened with a lawsuit? I have ordered procedures or tests that were probably not necessary just to “cover all the bases” and avoid a potential lawsuit

How do you think the practice of medicine will change in the next 10 years? (Check all that apply.) The reimbursement model will be reformed, doing away with fee-for-service in favor of bundled payments, or a yet-to-be-defined reimbursement model

50.1%

Primary-care physicians will be replaced by nonphysician providers

48.1%

Most practices will be meaningfully using EHRs, which will be interoperable and sharing information across systems

40.5%

Physicians will be conducting online visits and e-mail consultations

34.9%

The patient-centered medical home model will dominate, with the primary-care physicians at the center of the care-management team

31.2%

Most physicians will become hospital employed

30.2%

Other

8.9%

Nothing, the practice of medicine will essentially stay the same

6.6%

The national economic recession has affected my practice in the following ways: (Check all that apply.)

No: 57% Yes, sued: 27.6%

Yes, threatened: 15.4%

True: 72.6% False: 27.4%

My retirement plans n I will work full time for more years than I had intended because of retirement portfolio losses n I plan to scale my practice back to part-time rather than retire completely n I plan to retire on schedule

43.6% 28.5% 27.8%

www.physicianspractice.com

Patients are coming in with less frequency

54.3%

Many of my patients have lost their health insurance coverage

49.6%

Patients seem less likely to follow up on the treatment plans and tests I recommend, or to fill the prescriptions I write

44.6%

Patients are waiting longer to come in and are sicker when they do come in

44.3%

More of my patients are paying for their healthcare out of pocket

34.9%

We’ve experienced more appointment cancellations than normal

32.2%

The recession has not affected my practice

15.3%

Other

7.4%

Do you use any mobile technologies for work? Cell phone

70.2%

“Smart” phone — I use the Internet and apps on it for professional purposes

41.2%

Pager 41.0% Tablet computers

17.9%

E-Readers such as the Kindle

5.6%

None

5.1%

Other

4.6%

OCTOBER 2010 | Physicians Practice |

You wish you had True: 66.9% more time for your personal life. 1 A minority of you eat dinner with your family at least five nights a week and only half of you find time to exercise at least three times weekly. Still, you take care of yourself reasonably well: Most of you have a regular physician; you follow his or her advice; and you try to eat right. Almost 90 percent of you say you feel at least pretty good physically and emotionally. Most of you are as happy or happier right now than at any other time 30.9% of your life. 29.7%

In a typical work week, I spend

False: 33.1% 45.3%

29.7%

I don’t have as much time for my personal life as I think I should have

n Between 7 and 10 waking hours with my family/loved ones per week

25.1%

n Fewer than 6 waking hours with my family/loved ones per week

In a typical work week, I eat dinner with my spouse and most or all of my minor children

19.5% 19.9%

n Just about every night

30.7%

24.5%

n 3 or 4 nights n At least 5 nights

I exercise

13.2%

Are American doctors taking care of themselves? Here are the percentages of physicians who

Physically, here’s how I would describe how I feel most of time

n Hardly ever

15.1%

Eat right most of the time

77.3%

Have a regular primary-care physician

65.4%

Get routine checkups and follow their doctor’s advice

64%

Say their body-mass index is “a little higher than it should be”

47.9%

Say their body-mass index is “just right”

33.6%

Say their body-mass index is “much higher than it should be”

13%

Smoke cigarettes

3.7%

n Not bad. I’d say I feel better than most people my age n Fair. I’m a bit tired and stressed, but that’s to be expected n Terrific. I have lots of energy and rarely feel run-down n Poor. I’m exhausted much of the time, and I have other symptoms that concern me n I have a diagnosed chronic illness, but I’m getting treated and feel about the way I should under the circumstances n Very poor. Let’s just say I wish you hadn’t asked n I have a diagnosed chronic illness, and the treatment is not going well, or I’m not getting any treatment

| Physicians Practice | OCTOBER 2010

n 1 or 2 nights

16.4%

n At least 3 times a week n I don’t get much exercise n At least once a week n At least 5 times a week

n More than 10 waking hours with my family/loved ones per week

41.7% 32.3% 0.3%

0.6%

14.5%

5.3% 5.3%

www.physicianspractice.com

Emotionally, here’s how I would describe how I feel most of the time

n Not bad. I think I’m happier and better-adjusted than most people n About average. I have ups and downs like most people n A little below average. I feel sad or run-down more often than I probably should n Terrific. I almost couldn’t be happier n Poor. I feel sad or run-down much more often than I probably should

45.4% 32.1% 2.9%

9.7% 9.9%

Physicians’ self-reported median happiness score, on a scale of 1–10:

7.45 The happiest time in my life was/is

n Right now n I’ve always been pretty happy n Earlier in my career n During medical school or residency n When I was in college n I’m hoping some future time in my life will be happy n When I was in high school n When I was a child

25.7% 24.5%

4.3%

16.4%

4.5%

5.8%

9.2%

www.physicianspractice.com

9.7%

OCTOBER 2010 | Physicians Practice |

If I owned a time machine, I would

4.2%

The vast majority of you like being physicians and are satisfied with your choice of specialty. Yet four in 60% 10 would have made some change (perhaps 1 small) in your career 20.1% 4.1% path, if you’d 15.8% 59.2% known earlier what you know now. Your big17.4% gest career complaint is stress. You work a 12.1% mean of 51.6 hours a week; many (but not most) of you would like 7.1% to work less, but few are willing or able to earn less in n Accepts Medicare and will keep order to get more time off. About doing so for the foreseeable future a third of you are unhappy with n Does not accept Medicare your current employment situan Accepts Medicare tion, and that third’s most com but is considering mon complaint is an unhealthy dropping it in the workplace culture. You’d love to next few years stick it to insurance companies, Strongly Agree: 86.1% n Not sure too, including Medicare: Nearly n Is closed to new two-thirds of you have or would Medicare patients consider a no-insurance practice, but we still see while another 42 percent would our pre-existing even consider switching to a Medicare patients concierge practice. 3.2% 37.5% 12.1%

n Still choose to become a physician, but would select a different specialty n Choose a career in a profession other than healthcare n Choose some other career in healthcare as a nonphysician

I like being a physician

My practice

7.9%

42.5%

n Do everything roughly the way I did it the first time — I would not change much, if anything

Strongly Disagree: 3.5% Neither: 10.3%

I wish I worked … I’m fairly happy n Fewer hours per week 49.1% with my selection n More hours per week n I’m happy with my 47.8% of a specialty current schedule most of the time

If my children expressed an interest in medicine and asked my opinion, I would

n Try to answer their questions without encouraging or discouraging them from any particular career choice n Encourage them to consider becoming a physician n Discourage them from seeking a career in healthcare n Encourage them to consider a different career in medicine other than becoming a physician

| Physicians Practice | OCTOBER 2010

Strongly Disagree: 6.9%

Strongly Agree: 80.3%

… But

Neither: 12.8%

n I can’t or won’t take a pay reduction n I would be willing to take a pay reduction of as much as 10 percent if my hours were reduced by 10 percent n I would be willing to take a pay reduction of as much as 20 percent if my hours were reduced by 20 percent n I would be willing to take a pay reduction of as much as 50 percent if my hours were reduced by 50 percent 3.8%

8.5%

73% 14.8%

Percentage of physicians who work more than 50 hours a week:

46.7

Median number of hours worked weekly:

51.6

www.physicianspractice.com

Under certain circumstances, I would consider switching to a concierge practice where a small number of patients would pay an annual fee in exchange for extensive access to me.

Percentage of physicians whose practice employs nonphysician clinical providers:

53.2

42.9%

33.3%

9.4% 14.4%

Under certain circumstances, I would consider switching to a fee-for-serviceonly practice that does not accept insurance.

n Such a practice is not right for me but I don’t mind if other physicians do it n It might be worth a try, but only if it made sense economically n I think concierge practices are bad for the healthcare system, or unethical n I’m considering/have considered something like that already, or I’m already working in such a practice model

n It might be worth a try, but only if it made sense economically n Such a practice is not right for me but I don’t mind if other physicians do it n I’m considering/have considered something like that already, or I’m already working in such a practice model n I think practices that don’t accept insurance are bad for patients, or unethical

44.8% 10%

27.7% 17.5%

You’re a voter and you pay attention to the news. But False: 19% beyond that 1 you’re not very active politically. Maybe it’s because you believe physicians are not well represented in the halls of power, or maybe it’s because your politics are fairly moderate. You are typically American in your political heterogeneity: you’re split pretty evenly between conservative and liberal, nudging left only slightly. Because the healthcare reform debate was in full swing while our survey was ongoing, we couldn’t get a good read on where you stand on the final outcome, but 87 percent of you ranked the issue www.physicianspractice.com as very important, second only to the economy.

I often wish I could change jobs/employers Disagree: 67.8% Agree: 32.2%

The main reason I would prefer to work somewhere else n To get away from the unhealthy culture of 6.9% my current workplace n To get more time for 9.3% my personal life n To make more money n To live in a different geographic area n To advance my career or partnership prospects n Other

30% 23.6%

10%

20.2%

True: 81% 48.3%

6.4%

I plan to vote in the upcoming midterm elections.

45.3%

In the midterm elections, I’m likely to vote for

n More Democrats than Republicans n More Republicans than Democrats n Mostly third-party candidates

OCTOBER 2010 | Physicians Practice |

51.7%

If it were up to me, I’d like the American healthcare system to include the following features

20.2% 4.8%

10.2% 13.2%

I would describe my level of political activity as

Tort reform to reduce the size of malpractice awards

82.5%

Financial incentives/loan forgiveness to young doctors, to encourage more people to enter medical school

60.1%

n Moderately involved. I pay attention, and I vote. But otherwise I leave the politicking to others

A public marketplace or “exchange” where individuals could compare competing insurance plans and make purchases

53.9%

An option for consumers to purchase insurance from a government-run insurance plan that would compete with private insurers

48.6%

n Somewhat active. I have occasionally volunteered time or donated money to a political candidate or organization. Sometimes I attend political rallies

A health insurance market that is no longer tied to employment; all Americans would purchase their insurance in the individual market, with income-based subsidies

44.4%

A nationwide healthcare information system

43.1%

Electronic health records systems paid for by the government

42.4%

A requirement that every American citizen carry health insurance

38.6%

A single-payer system in which all individuals get their insurance from the government

18.5%

A fully government-run health insurance system

9.5%

Other

8.0%

n Not very involved. I usually ust vote for whomever my party has nominated and don’t pay much attention beyond that n Hardly at all. I usually don’t vote n Very active. I usually volunteer on campaigns/raise or give money to candidates/organize political events

I am a registered

n Democrat n Republican n Independent n Not registered n Libertarian n Green

0.4%

37.1%

Tell us how you feel about the following statement: “I believe physicians are represented about as 55.8% well in Congress and the White House as most other 31.1% 11.3% professional groups.” 1.9%

27.7% 0.7% 12.7%

n I disagree with the statement. Occasionally the AMA or some other physicians’ group can break through on a specific issue, but in general doctors are not well-represented in Washington n The statement is nonsense. Washington doesn’t care what doctors think n I’d say the statement is about right

21.3%

n I think the statement understates the influence that physicians have in Washington, which is actually quite significant

In general, I’d characterize my political views as Very liberal

7.3%

Liberal

17.3%

Moderately liberal/center-left

15.5%

Middle-of-the-road; I don’t lean left or right

14.5%

Moderately conservative/center-right

13.3%

Conservative 13.8% Very conservative I consider myself liberal on social issues but fiscally conservative I consider myself liberal on economic issues but socially conservative.

| Physicians Practice | OCTOBER 2010

5.4% 11.3% 1.6%

BOTTOM LINE

So, what’s the state of the American physician community in 2010? Our Great American Physician Survey finds you feeling happy yet underappreciated; hopeful yet fearful; connected deeply to your patients, and yet poorly understood by them — as well as by politicians and even your own families. For example we asked you to tell us, in your own words, what you’d like to tell those groups about your job and your life. “I went to 24 years of advanced education. I deserve to be treated like I know more than a nurse that went to school for [three] years, and I deserve to be trusted more than a politician that thinks they know what’s best for patients,” one physician wrote, in a nice summary of a common sentiment. There is a good bit of resentment among doctors these days, our survey finds: You sense that decisions are being made for you, and demands placed upon you by people who don’t know the first thing about being a doctor these days. And you’re none too pleased about it. That said, it seems you’re enjoying the ride. “Despite all the complaining, it is still the best profession around,” says one physician. Amen. n

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illustration: Brian Stauffer

By Keith L. Martin

| Physicians Practice | January 2011

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“Data, data, data. That’s the key.” So says Deron Schriver, executive administrator of The Women’s Healthcare Group in York, Pa. In an atmosphere of fluctuating reimbursements, shifting patient insurance coverage, and the uncertain impact of health reform on private practice, quality data to inform decision making is more important than ever, Schriver says. When he joined the 6-physician OB/GYN practice nearly five years ago, he found that it was being underpaid by most payers, compared to the going rate at the time. “I think our payers really knew they were getting a good deal with what we had in place,” he says.

www.physicianspractice.com

But after a little cleanup and some reorganization, Schriver says the practice is caught up, has its data readily available and constantly monitored, and there has definitely been a reaction from payers. “I’ve noticed it is getting more difficult each year to get the increases we are looking for,” he says. “There is a lot of push back and a lot of offers and counteroffers taking place in our negotiations.” But Schriver notes that as far as reimbursements, the practice is “very pleased” knowing “it has been a little tough out there.” “I’d say the rates we are getting are keeping us financially strong, regardless of what we are seeing with

the economy, so we are pleased about that,” he adds. “However, we are noticing the environment out there is getting more difficult from a reimbursement standpoint.” This is evident in our 2010 Fee Survey Schedule. Looking at national averages for commercial reimbursement for new and existing patient visits, the average increase in payments by commercial payers is only 1.4 percent greater than the prior year. Government reimbursement continues to lag behind commercial rates, although by narrower margins. The complete data are found on the following pages, along with some analysis. More important, though, is advice from the experts on how to put your practice ahead of the average.

January 2011 | Physicians Practice |

Cover Story Average Commercial Reimbursement

New PAtient Visits

$48.50 $68.30 $89.70 $120.20 $144.10

$53.50 $73.50 $104.30 $135.40 $154.60

$56.40 $82.50 $118.80 $141.90 $160.00

$46.90 $69.10 $100.00 $130.60 $151.30

$50.90 $73.40 $100.50 $131.00 $148.90

$45.20 $67.60 $96.30 $131.70 $152.40

$47.40 $67.80 $96.90 $128.80 $153.30

$49.83 $71.74 $100.93 $131.37 $152.09

$39.82 $68.58 $99.93 $155.23 $194.69

existing PAtient Visits

Middle Atlantic Mountain New England North Central Pacific South Central South East Average Medicare

99201 99202 99203 99204 99205 99211 99212 99213 99214 99215

$29.10 $43.60 $62.10 $84.70 $108.00

$26.90 $44.60 $70.30 $91.90 $114.30

$29.70 $49.40 $77.50 $101.90 $119.40

$27.80 $45.10 $67.50 $93.90 $117.40

$31.90 $47.10 $68.80 $92.50 $114.00

$32.00 $44.10 $67.10 $91.20 $112.00

$26.00 $42.90 $64.60 $90.50 $113.70

$29.06 $45.26 $68.27 $92.37 $114.11

$19.54 $39.82 $66.74 $99.93 $134.95

Survey Stats

Total Responses: 969 Data Collected: 2010 Re gion

Per cE NT

Middle Atlantic 16% Mountain 7% New England 4% North Central 18% Pacific 16% South Central 14% South East 22% Group Size

Per c ent

1 28% 2-10 53% 11-25 9% 26-50 4% 51-100 3% 101-200 2% more than 200 1% Sp e cialty Ty pe

Per c ent

Medical Specialty 23% Primary Care (FP, GP, IM, PED, OB/GYN) 49% Surgical Specialty 14% Other 12%

in summary To get paid more for the work you do:

your payer mix. Knowing who • Monitor your larger payers are ahead of time can help you assess the impact of rate cuts, as well as show your in-network power when it’s time to negotiate.

payers what sets your practice • Show apart, from ancillary services to add-ons. advantage of federal incentive • Take programs, but only if the cost to par-

• 4

ticipate reaps greater rewards.

Train staff to address upfront payments with patients and discreetly discuss past due balances.

| Physicians Practice | January 2011

For the most part, commercial payers are still above national Medicare reimbursement rates, except when it comes to longer visits with patients. The 99204, 99205, 99214, and 99215 visits are all being reimbursed, on average, 18 percent below Medicare, with the 99205 a whopping 28 percent lower. The 99213 midlevel established office visit is reimbursed by commercial payers at $68.27, up 4.1 percent from 2009 — the biggest leap among all E&M codes — and slightly higher than Medicare’s $66.74 payment, which itself is up 8.1 percent from last year. In fact, all Medicare reimbursement rates for E&M codes are up an average of 7.4 percent. Congress and the president avoided a double-digit Medicare cut in June, replacing it with a modest increase in average rates of 2.2 percent. But draconian cuts in Medicare seem to be on the table at all times, and Congress was wrestling with a prospective cut of 23 percent as this issue was going to press. So with the likelihood that whatever is done at the federal level will be mirrored among private payers, it is more important than ever that practices look hard at the data when it comes to the dollars coming from three key sources: commercial payers, the government, and patients. You can find tips and advice on how to work with patients on what they owe in the sidebar on page 18 and online at Physicianspractice.com. Here’s some help in getting paid more for the work you are already

doing at your practice and some things you might be able to tweak to boost revenue. GET IN THE MIX

Part of Schriver’s job is evaluating payer mix, the amount of practice revenue tied to each insurer. Each month he reviews a report generated by his practice management system showing the percentage of charges for each payer and related collections. “You need to know how much of a share each payer has of your business, and use that to your advantage from a negotiation standpoint and from an overall contract management standpoint,” Schriver says. Reed Tinsley, an accountant and business adviser to practices, says payer-mix evaluations are vital to identifying two key issues: vulnerabilities and opportunities. Evaluating your payer mix identifies potential problems for your practice — suppose there is a major change in reimbursement from one of your larger payers? You can also identify payers who may not be worth working with at all, and those too big to dump but whose low rates cry out for renegotiation. With data in hand, Tinsley advises practices to be proactive and start improving relationships with those managed care plans. Many practices believe that such discussions will be fruitless, but “you have to try,” he advises. Even if you can’t negotiate better rates on the first try, he adds, “at least you will come out of those discussions knowing what it will take to improve your reimbursements down www.physicianspractice.com

$260 $240 $220 $200

$244

$248

$226

Year to Year Comparison of Average Commercial Reimbursement (National Average)

$201

$180 $160 $140 $120

$155 $142

$145

$100 $80 $60

$139

$150

$152

$131

$99

$100

$72

$71

$49

Data to the payer, about the payer.

$110 $100

$103

$67

$73

$81 $58

$40 $20

n 99205 n 99204 n 99203 n 99202 n 99201

$0 2006 2007 2008 2009 2010 $220 $200 $180 $160

$177

$140 $120

$80 $60

$129

$86

$90

$63

$67

$72

$45

$52

$40 $20

Year to Year Comparison of Average Commercial Reimbursement (National Average)

$125

$100

$39

$117 $97

$36

$113

$114

$91

$92

$65

$68

n 99213

$45

n 99212

$28

$29

n 99211

n 99215 n 99214

$0 2006 2007 2008 2009 2010

the road. You go back to your office, strategize on what it will take to improve and start making those improvements.” You can also walk away from a payer, but should do a full evaluation of the impact of that decision before leaving — or even threatening to leave — a relationship. When it comes to payment negotiations with payers, there are some key tactics to employ. Use your leverage. Taylor Moorehead with Zotec Partners, a company providing medical billing solutions, says a successful negotiation is all about leverage. Hospitals use leverage all the time by threatening to decline a payer’s contract outright — forcing patients to pay out-of-network rates or go elsewhere. When patients balk at this prospect, they can become the hospital’s best negotiating ally. Would such a tactic work for a practice like yours? Maybe, if your practice is large enough, and your www.physicianspractice.com

The Women’s Healthcare Group brought in a registered dietician to give free classes to pregnant patients, something very few OB/ GYN practices have in-house. “This is something we’ve done to set us apart,” Schriver says. “Every practice should have something like that … that increases their attractiveness to a payer.”

payer-mix review reveals a large volume of patients coming from a single, low-paying insurer. But you need to be prepared to actually walk away from a payer before you threaten to do so, and for that you must first understand the consequences of losing a high-volume payer. Run the numbers. In most cases, says Moorehead, it’s better to seek leverage in other ways. Promote your uniqueness. Sometimes leverage can come from letting payers know what makes your practice different. The services you offer that no one else in the area does show that you are a unique and valued commodity. Make sure your payers know about them — payers don’t want to lose providers who perform rare services. Moorehead knows a radiologist who is the only one in a 50-mile radius performing neuroradiology. That’s leverage. But you don’t need to be a subspecialist to be different.

By conducting a review of your payer mix, not only do you get to know about each payer, but you can also compare your partners across the board. Tinsley says he always brings data on the payer to negotiations and, sometimes, will ask for data from the payer. Schriver says the “best tool at my disposal” is a spreadsheet he has created showing all the fees for all of the codes his practice bills, listed by payer. “There is no better way, in my mind, to truly evaluate, in relative terms, what we are getting paid.” “You really need to know where they rank in relation to all of the other payers, code by code, looking for an aggregate percentage of Medicare,” Schriver adds. “You definitely have to go into any discussion with that data.” Our Fee Schedule Survey data, presented throughout these pages and in greater detail at PhysiciansPractice.com, adds a second dimension to such an analysis: Your own data clarifies how well each of your payers pays you in relation to other payers. Our data helps you understand how well each pays you compared with other practices in your market. But knowing how much you’re paid is only part of the equation when assessing payers’ value. You should also examine how easy they are to work with, how often they deny claims, how long they take to pay you, and other important “hassle factors,” all tracked and ready when you need them. Physicians Practice offers data on this, too, each year with its PayerView report, accessible online at www. physicianspractice.com/overhead/ content/article/1462168/1591197. Schriver adds that given the current reimbursement climate, “it becomes more and more clear to me that I have to come to the table January 2011 | Physicians Practice |

Cover Story with lots of tools to discuss fee schedules with that payer.” Have the right attitude. Often times, asking anyone for money can be tough, but it doesn’t have to be confrontational. Tinsley tells his clients to understand that payers don’t want to give money away, so the best attitude to take is, “if you scratch my back, I’ll scratch yours.” In other words, let the payer know why you deserve more money and the positive result of a better relationship. He cites a group with four urgent care centers. By using data, he was able to show that these offices were keeping patients out of the local ER and that avoiding those visits benefited the payer, who would pay more to the hospital, so the centers got a better reimbursement rate instead.

Reed Tinsley, consultant

90465 $18.55 90471 $23.85

“My attitude is, ‘I’m going to ask you for this money, but in return, how can I work with you to improve the delivery of healthcare on my end to reduce costs because you too are going to save money on your end?’” Tinsley says. Moorehead adds that if you are looking for an ally in negotiations, appeal to the one person at the insurer who knows the position you are in: the physician medical director. While this person may have no role in setting rates, he may be able to vouch for the way you code for a procedure or the unique services you provide for the network. “Go physician-to-physician,” Moorehead says. “I’ve gotten groups to meet with medical directors to negotiate rates and almost every time, it has worked.”

93000 $27.43 95117 $16.77

GOVERNMENT RELATIONS

Payments/Procedures What are the most common procedures you bill for and what do payers reimburse you for them?

Code Reimbu r s em ent

11100 $106.70 17000 $77.40 17003 $10.01 17110 $102.25 20610 $72.86 36415 $4.32 69210 $42.01 81002 $5.37 87880 $14.15

96372 $21.53 99203 $101.84 99204 $141.12 99212 $45.22 99213 $66.56 99214 $94.71 99215 $123.46 99232 $72.02 99391 $89.49 99392 $88.26 99395 $116.75 99396 $127.20

“It is amazing how poor physician offices are by not billing everything they are entitled to get paid for. CPT coding is everything.”

| Physicians Practice | January 2011

Of course, you can’t really negotiate with the government the way you can with payers. Medicare and Medicaid are take-it-or-leave-it when it comes to rates. What you can do, however, is use the same evaluation tactics to determine whether the time has come to decline to see any new Medicare patients, or to end your relationship with Uncle Sam entirely. If you do stick with the government payers, you can at least be sure that you’re getting paid what you’re owed.

“If you are supposed to get $500 and you are getting $495, you’re being shorted $5 every single time and if you are looking at thousands [of claims], you better be checking,” Moorehead said. Robert Hill, Jr., a principal with Philadelphia-based Health Strategies and Solutions, agrees with Moorehead that checking payments and all transactions at the end of the month is a good idea to be sure you are getting all you were promised from the government. If you are not getting paid what you agreed upon, you have the right to appeal. Yet Schriver also notes that practices have to stay on top of payer policies, making sure a staff member keeps up with e-mail bulletins and newsletters informing them of changes in policies and the impact on coding or reimbursement. “The most important thing, as a starting point to making money” is CPT coding, says Tinsley. “It is amazing how poor physician offices are by not billing everything they are entitled to get paid for. CPT coding is everything.” ACCESS INCENTIVES

Hill also advocates working to optimize any payer incentives by data tracking, shifting to later hours of operation, accepting sick clinic and walkin patients, and EHR integration. “All that can help you optimize payments from various payers,” Hill says. Since 2007, Idaho Emergency Physicians in Boise has participated in Medicare’s Physician Quality Reporting Initiative (PQRI) — which provides incentive payments in return for data on quality measures for services to Medicare beneficiaries. Lisa M. Jolliff, the practices’ coding manager and compliance officer, says her staff of certified coders reads the charts, abstracts, and reporting items as necessary, and in addition to CPT and ICD-9 codes, www.physicianspractice.com

adds the PQRI codes to report this data to the federal government. She concedes it took some money to adjust the practice’s practice management software, as well as the cost of training for staff to get used to taking a few more steps with each patient record. But the outcome of those few more steps — which are now second nature to the coders — has resulted in $20,000 from the PQRI program in 2009. “That’s $20,000 more than we had,” she says, “so why would we leave those dollars on the table? Why leave it there if it is available to you?” But with possible cash comes caution, Jolliff says. Practices need to see if participating in PQRI and other pay-for-performance programs are cost-worthy, balancing the cost to implement additional reporting with what they could get in return. If participation means thousands of dollars for technology upgrades or even a new system, or, hours of staff training or hiring additional staff, it may not be worth it. And then there are looming federal incentives for adoption of certified EHRs, with practices anticipating certification of their systems or word that they need to buy new ones in order to meet the government’s “meaningful use” guidelines. Hill says that meaningful use of EHRs can have the double benefit of bringing in federal incentive dollars while also helping practices audit payments and compliance with their various payers. BABY STEPS

Working with payers for greater reimbursement, making sure the government is paying you everything you are owed, and taking advantage of incentives from public and private payers are all key elements in maximizing your revenue appropriately for the work you do. And don’t forget about working with patients to get what you are owed, a subject we cover in the sidebar on page 18 and online at Physicianspractice.com. “People need to focus on the different pieces of the revenue cycle,” advises Louis D. Papoff, chief financial officer of physician serwww.physicianspractice.com

vices for Vanguard Health Systems, which owns hospitals and physician groups in the Chicago area. “They are all important and perhaps the best way to break things down is to do so in the tiniest pieces and make sure each of those pieces is being done correctly.” n Keith L. Martin is associate editor at Physicians Practice. He can be reached at keith.martin@ubm.com.

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HOW DO YOUR PAYERS RANK?

Each year, PHYSICIANS PRACTICE ranks the payers in a report called PayerView.SM How well does your payer treat physicians? Find out by searching Payerview at PhysiciansPractice.com..

It’s a common feeling about hospice, and we know it makes your job even harder. But in reality, hospice is a wonderful word that offers solutions, comfort and peace-of-mind. And at Crossroads Hospice, it’s a word that offers education, support and extensive resources for you, your patients and their caregivers. To access FREE informational resources for you and your MORE THAN patients, visit www.CrossroadsHospice.com/resources1 JUST PRINT The Physicians Practice Buyers Guide is more than a print directory! Our online version allows you to browse our electronic listings by category, compare products and services side-by-side, and email vendors with a click. See it at PhysiciansPractice.com.

SIGN UP FOR 1-888-909-MOREOUR (6673)POPULAR E-NEWSLETTERS “I sometimes feel isolated in my practice without a barometer to the practical aspects of business. January 2011 | Physicians Practice Your e-newsletter is a huge help.” – Allish Hayes, MD, Boston, Massachusetts

COVER S TOR Y

Getting PAtients to pay

Patients are the hardest group to collect from. To do it well, you need good procedures. By Keith L. Martin

Negotiating with payers for adequate reimbursement requires good preparation and lots of focus by practice managers. The toughest payers to collect from, though, are not commercial insurers or federal programs, but your own patients. For that, you need good practice policies — and a determination to follow them. Reed Tinsley says the key is accountability. Tinsley, an accountant and business adviser, says that careful attention to time-of-service collections is the most important aspect of getting paid by your patients. The goal at time of service, he says, should be at least 90 percent of the payment.

He advises that payment needs to be an understanding between staff and patients handled professionally and with documented policies. “It should be an expectation and part of the professional business culture as it is critical to the success of the practice,” Hill says. Over the past year, the physician services division for Vanguard Health Systems has seen a greater number of self-pay patients, according to its chief financial officer of physician services, Louis D. Papoff. Vanguard has separate LLCs for its four employed physician groups as part of its ownership of four Illinois hospitals. Papoff says that once the shift to self-pay patients became clear,

“The more money you collect upfront, the better your receivable cycle.”

Time of Service

– consultant Robert Hill, Jr.

“The more money you collect upfront with patients and their families, the better your receivable cycle and the more money you’ll generate for the practice,” Hill says. And one way to increase timeof-service collections is to accept every reasonable form of payment, especially debit and credit cards. Robert Hill, Jr., with Health Strategies and Solutions in Philadelphia, says people have grown accustomed to using “swipe and go” payment methods at grocery stores, retail shops, and gas stations. Why should yours be the last business in town that makes it harder for people to pay? Working with staff on proper communication and collection of payments “is critical and essential” as “the economics of physician practices are probably worse now than they’ve been at any time in history that we can recall,” he adds. 8

| Physicians Practice | January 2011

Vanguard began focusing not just on time-of-service copays, but also on collecting past-due balances and old A/R, implementing a system in all its offices that alerts front desk staff to any outstanding balances. This awareness by staff to be more attuned and more sensitive to financial considerations has led to clearer communications with patients and discussion of options, including setting up a payment plan to address any outstanding balances. The result, he says, has been “a remarkable improvement, which has gone a long way to offsetting some of the difficulties with the payer mix shift and the increase in self pay.” THE COLLECTIONS CONUNDRUM

With a 41 percent reduction in bad debt, Papoff credits staff for focusing on issues beyond the copay — reducing the cost of sending statements with follow-up letters to patients and the need to hire collec-

tion agencies, who take a portion of the outstanding A/R. “While collections [agencies] are perfectly appropriate for the industry … it is really not a patient satisfier to send someone to collections,” Papoff says. “Those patients would like to settle their bill, if done in an appropriate fashion.” To achieve the same results in your practice requires training of staff and possible tweaks to your billing system, but Papoff says having a firm grasp on what is owed to your practice is just as important as knowing your patient mix. Tinsley says some practices consider sending patient statements a “routine part of their business,” but it shouldn’t be. A patient should get a 30-day notice to pay, then a 10day letter, advising him of a window to reach the practice to discuss the outstanding debt. Only if there is still no contact should the patient be sent to collections, he advises. At The Women’s Healthcare Group, where Deron Schriver serves as executive administrator, any time the practice sends more than two statements to a patient, it carries an additional $10 fee, which Schriver says usually spurs prompt payment. Working with payers for greater reimbursement, taking advantage of possible incentives from the federal government, and streamlining your patient payment process are all key elements in getting paid for the work you do every day. “People need to focus on the different pieces of the revenue cycle,” advises Papoff. “They are all important and perhaps the best way to break things down is to do so in the tiniest pieces and make sure each of those pieces is being done correctly.” n Keith L. Martin is associate editor at Physicians Practice. He can be reached at keith.martin@ubm.com. www.physicianspractice.com

COVER S TOR Y : From the front Lines

‘How I implemented a cash-only model that works’

mouth about short wait times and hour-long office visits made insured patients in our community envious of those treated at our office, and so they came. It turns out that most patients value the attributes of a direct-pay practice more than the hassle of filing their own insurance. Medicare patients frustrated with not being able to find a physician accepting new patients or with the patient mill they have experienced in the past have come in droves. They find that paying the physician directly gets them more time, more attention, and a better medical experience. They sign their private

By Brian Forrest, MD

Ten years ago no one thought it could work. Not taking insurance, not being in any PPO networks, refusing to make the burden of insurance filing overhead my own, I opened my cash and carry practice on April Fool’s Day almost a full decade ago. I had seen the strain on patients without insurance who could not afford to pay for simple follow-up visits or health maintenance screenings. I had witnessed firsthand the burnout of primary-care physicians working around me on a treadmill of widget production, trying to see enough patients each day to keep their doors open. I knew there had to be a better mousetrap. After reading and researching various models of healthcare delivery, I spent about 18 months designing a practice structure that would address these problems. Uninsured patients had to somehow have access to discounted cash rates. Physicians had to be able to spend more time with patients and not feel like they had to run room to room. What I have discovered over the years is that my innovation is really just a throwback to 50 years ago. Patients once paid their physicians directly, sometimes with cash, sometimes with chickens, sometimes with seed. A doctor’s office usually had only one staff person at that time. That person did not have to submit insurance claims, appeal rejected claims, or worry about proper coding and modifiers. They helped the physician check patients in and out and assisted with procedures. Wouldn’t it be nice to go back to that simpler time? Well, that’s exactly what I did. By shunning all insurance contracts, permawww.physicianspractice.com

POSSIBLE SOLUTION

If there were 1,000 practices like mine, Medicare might be solvent again. nently opting out of Medicare, and integrating modern technology with the simplicity of the past, I created a low-overhead, direct-pay practice model. Ten years later we have about 6,000 patients in our micropractice. We save uninsured patients about 85 percent overall on their outpatient healthcare costs through reduced fees. We have been identified as one of 28 Cardiovascular Centers of Excellence in the United States. Our outcomes measures such as HgbA1C, average LDL, and percent of patients at their blood pressure goals are in the top 10 percent nationally based on audits done as part of a CQI program conducted by COSEHC and evaluations done by fourth-year UNC Chapel Hill medical students participating in a “New Models of Care” elective. The big surprise to me is that 53 percent of our patients have traditional insurance. I anticipated an almost entirely uninsured clientele when I opened, but word of

contract and find that their out-ofpocket cost for the year is similar if not less than what it was when they saw a Medicare provider. Skeptical? Here’s some simple math: If a patient has Medicare Part A and Part B and no supplemental insurance, they are responsible for 20 percent of the bill. Remember, I said our rates are 85 percent less than typical fees. This means with no supplemental insurance our patients might save 5 percent. Moreover, look what Medicare saves, as it has never been billed for any of the 10,000-plus Medicare-eligible visits to my practice. If there were 1,000 practices like mine, Medicare might be solvent again. HOW IT WORKS

Patients can either pay a la carte from a posted menu of services in the waiting room or they can pay $29 per month and $20 per visit. On the a la carte menu, the most expensive visit is $49. Ancillary services such as labs, splints, and injections are charged at nominal January 2011 | Physicians Practice |

fees like $25 to $36. Patients can actually add up their own bill before they are seen if they know what they will need. For those that pay monthly, we give them an “Access Card” that allows them to come in whenever they want for a typical overhead charge of $20 that includes most ancillaries and labs. The idea is that patients are paying their provider directly each month for managing their healthcare. That becomes the profit. When they actually use services, we simply make sure that their charge covers our overhead associated with that visit. This

diabetic, hyperlipidemic patient normally spends around $500 per year for all of his care with us. That usually includes a comprehensive physical with an EKG, quarterly labs like HgbA1C, lipids, and metabolic panels, and on average five 45-minute to 90-minute visits per year. So, we are not concierge, although from a physician and patient standpoint we have many of their benefits. The key to making a direct-pay model work is keeping overhead low. If you are charging 85 percent less, then your collections need to be near 100 percent (99 percent for

It turns out that most patients value the attributes of a direct-pay practice more than the hassle of filing their own insurance.

WORTH IT

means that if you have 1,000 patients paying you $29 per month for your services, and if the per visit fee is just enough to cover your overhead, then your take-home salary is a reasonable $348,000 per year and your salary is no longer volume dependent. If you want to look after 2,000 patients you could probably handle that, too. We are not concierge. The one criticism I get most often is that “concierge practices like ours” cater only to the wealthy and that if everyone practiced this way the physician shortage would be even worse. Such criticism of concierge practices is valid, but those criticisms do not describe our model. In concierge practices, the management fee, or annual fee, or executive physical fee is typically over $1,000 per year — and in addition to that annual fee, most concierge practices continue to bill insurance or Medicare. We have never had a patient spend over $1,000 out-of-pocket in a year. On average, a hypertensive, 10

| Physicians Practice | January 2011

us) and your overhead needs to be much lower than the traditional 50 percent to 60 percent. My practice overhead was about 25 percent last year. There is a lot of planning and efficient use of resources that goes into that. Among the essential efficiencies is staffing. We have two physicians, one full-time nurse practitioner, and one full-time and two half-time medical assistants. Essentially we have 0.66 FTE per provider instead of the normal 4.5 and that is the key to keeping the overhead down. For someone who is solo, they would need one full-time medical assistant and that’s it. No coders, no billing clerks, no office manager, no RN, no receptionist (the medical assistant does that). That’s how you can break even with overhead seeing only four patients per provider per day. What about the Patient Centered Medical Home model and the Idealized Practice from the Future of Family Medicine Report? Our practice model is an example of

both. We use a CCHIT-certified EHR, referral tracking, registries, care coordination, continuous quality improvement, practice redesign, patient satisfaction surveys, electronic patient communication and reminders, and most of the other features that help ensure a patientcentered practice that is financially viable. Best of all, our model is sustainable since it is immune to the whims of payers. The PCMH model is not mutually exclusive of direct pay. They coexist quite nicely. Ideally, every primary-care practice should be a medical home, because that really does offer the highest quality cost-effective care. However, practices implementing the PCMH model in a traditional payer environment are going to continue to be challenged unless real payment reform that rewards the model comes to pass. In a world of Medicare RAC audits, Red Flag rules, stagnant reimbursement, and the certainty of further Medicare/Medicaid cuts looming, physicians are looking for a way out of the current complex system into a new practice model-world where the doctorpatient relationship is at the core of healthcare again rather than the third-party payer. The future of the direct-pay practice model is bright. It may become the main source of care for patients who want quality, affordable, accessible, and transparent healthcare. n Brian Forrest, MD, is an adjunct associate professor at the UNC Chapel Hill Department of Family Medicine where he teaches an elective class called “New Models of Care.” He is the founder of Access Healthcare, a COSEHC Cardiovascular Center of Excellence. He is also president of forrestdirectpay.com, a Web site dedicated to helping physicians explore the direct-pay practice model. Currently, he serves as presidentelect of the North Carolina Academy of Family Physicians. www.physicianspractice.com

Brought to you by

your hospital February 2011

In Search of NEW REVENUE 10 Great Ways to Earn More Cash … Without Selling Out

also inside: Pearls: How to Boost Your Margins Technology: The Mobile Health Revolution Administrator’s Desk: Adding In-house Rx Dispensing

In Search of NEW REVENUE 10 Great Ways to Earn More Cash â&#x20AC;Ś Without Selling Out

By Shelly K. Schwartz

You can also make a lot of money. While news outlets don’t pay for interviews, Shu notes, they do help promote her practice

and her latest book, “Heading Home with Your Newborn,” which she coauthored with colleague Laura Jana. And the editing jobs, which consume “a few hours” of her time, pay enough to compensate her for seeing patients just three days a week. (She takes one day off for personal time.) But the biggest checks, by far, come from private companies — such as juvenile product manufacturers and health food outfits — that hire her as a medical expert. Shu occasionally earns between $10,000 and $20,000 for half-day events in which she conducts a series of satellite television or radio interviews about such topics as healthy eating habits and dealing with the common cold. “Done the right way, if it’s something you believe in, you can be compensated well,” she says.

Like Shu, many physicians are looking for ways to boost their bottom line — and redefine their careers — amid declining reimbursement. Some simply squeeze in more patients, but not all practices are scalable. After all, you can only eke out so much efficiency without impacting quality of care. For those with an entrepreneurial mindset, however, there are a number of ways to create supplemental income without putting your practice on hold. A few options, like becoming an expert witness or hosting patient-education seminars, can easily be done in your down time, while others, such as serving as a medical director or becoming a part-time consultant, require a bigger time commitment. Here are 10 options worth considering.

illustration: Christophe Vorlet

Pediatrician Jennifer Shu spends most of her week treating coughs and colds at Children’s Medical Group in Atlanta. But she performs an even greater public service on her days off. The consultant, author, and parenting guru dedicates at least one day a week to media gigs — conducting interviews, editing content for publications, and working with companies she supports to help promote their message. “I’ve been practicing for 16 years and I love that too, but you can reach so many more patients through the media when you’re trying to get a public health message out,” she says.

Cover Story IN-HOUSE DISPENSING

BECOME A MEDICAL DIRECTOR

You could make $50,000 or more per year by opening an in-house pharmacy. Thanks to changes in the Medicare Part D program, physicians are now able to dispense prescription drugs to patients directly at the point of care — and get reimbursed for it. Because it requires special billing and contracting with private insurers, however, most practices use third-party vendors like QuiqMeds, Dr. Dispense, PrimaryRx, MedX Sales, or Physician Partner, which stock their offices with the most commonly prescribed drugs and handle the administrative hassles for them. For its part, MedX Sales claims practices profit approximately $8 to $10 per medication dispensed. Dr. Dispense, which offers an integrated software solution that adjudicates claims through existing electronic health records, says the typical small practice generates $4,000 to $5,000 per month (or $60,000 a year) using its program after the cost of medication. Meanwhile, Physicians’ Pharmaceutical Corp. which enables doctors to fill the actual prescriptions they write using an in-house certified prescription technician — rather than using prepackaged quantities and dosages — says some of its clients are just breaking even while other high-prescribing offices are making “hundreds of thousands of dollars.”

The aging population presents opportunity for those with a medical degree. Long-term care facilities, including hospices, home health agencies, and nursing homes, are required by federal law to retain a medical director who can coordinate patient care, establish procedures for quality assurance, and provide administrative oversight. They often look to family physicians and internists, particularly those with a geriatrics subspecialty, who perform their duties in addition to maintaining their full-time practices. Karyn Leible, president of the American Medical Directors Association, says such positions pay an average of $150 an hour. And the time commitment varies. As chief clinical officer of Pinon Management in Lakewood, Co., a consulting firm for nursing homes and assisted living facilities, Leible says her group expects at least four hours a month from each of the medical directors in the 13 homes they manage. Other facilities, though, require up to 10 hours of work each month, paying anywhere from $1,000 to $3,000 monthly.

in summary Consider these ideas for boosting your income:

pharmacies can add • In-house $50,000 or more to your bottom line. payers reimburse for online • Most consultations, which can be done

after hours or as needed to fill in for a no-show.

consulting rates range from • Average $3,000 to $7,000 per day, depending on your area of expertise and type of training provided.

can make up to $6,000 a day • You as an expert witness, but legal work should constitute no more than 5 percent of your income.

pays to sublet unused space. • ItJustoften be mindful of Stark rules when it comes to referrals.

| Physicians Practice | February 2011

EMBRACE THE WEB

For the computer savvy, the Web is a channel worth pursuing. Many of the larger health plans now offer in-network doctors an opportunity to conduct online medical consultations with patients through realtime videoconferencing or secure chat. Most plans reimburse less for online encounters, normally between $30 and $40 per 10-minute visit, but the advantage is that you can hold them when and where you like — after hours, over the weekends and from the convenience of your own home. If you’re looking for greater flexibility you can also sign on with an online care service company like American Well in Boston through any of its participating health plans. The company has created a Web portal that allows physicians to hold online visits, review clinical information, prescribe medication,

and suggest follow-up care. Even if your physical waiting room is full, you can indicate via software that you’re willing to accept “Web walkins” from just your own patient base. Or you can switch to accepting online visits from other health plan members for the next, say, 20 minutes, to fill in for a no-show. The system also supports a fee-for-service model, allowing specialists who have established a reputation to set their own rate. The head of oncology for a major metro hospital, for example, might be able to charge $300 for a 10-minute online visit. BECOME A CONSULTANT

If you’re looking for a career transition, or a chance to reduce your office hours prior to retirement, you could establish your own consulting business. Many organizations require the expertise of a physician, including healthcare systems, pharmaceutical firms, technology or device companies, and insurance companies. And chances are you’ve got more to offer than you think. For instance, if you helped orchestrate a successful merger or created a physician-integration tool kit that would be useful to other organizations, these types of skills are directly marketable. “It takes a special mindset, but there are a lot of physicians who have expertise that they’ve developed by virtue of working on committees for information technology implementation or those related to quality assurance,” says Francine Gaillour, a former internist and executive director of physicianleadership. com, a Web site that focuses on executive coaching. “You need to put some thought into what your service is, how you’re going to deliver it to a client (group seminars, training classes), how you’ll price it, and how you’ll market it,” says Gaillour, author of the “Physician’s Definitive Guide to Career Transitions.” The average consulting rate ranges from $350 to $500 an hour, or $3,000 to $7,000 per day, depending on the type of consulting or training provided, she says. www.physicianspractice.com

STOP SENDING PATIENTS AWAY

Ancillary services are a tempting proposition for practices looking for a quick fix to their bottom line. And they can be profitable, if implemented with care. Vivian M. Luce, regional director for physician recruiting firm Cjeka Search in St. Louis, says one of her clients, a Midwest single specialty practice, makes an extra $350,000 a year by doing cosmetic Botox injections. Other practice consultants suggest the most successful groups average 20 percent to 35 percent returns on imaging services, such as radiology, CT, and MRI scans. Data from the Medical Group Management Association’s 2010 Cost Survey for Orthopedic Practices also reveal that the median independent orthopedic surgery group realized $57,886 per physician in net revenue (after operating costs) for MRI services, and $41,887 per physician for diagnostic radiology (X-ray) services. But many practices also lose money on ancillaries. Before jumping in, conduct an in-house audit of the referrals you write monthly for things such as medical imaging, diagnostic testing, physical therapy, and laboratory services. Once you’ve identified an area of potential demand, research your local market to determine whether it’s already saturated and contact your payers to determine how much they reimburse for that service. Some payers contract exclusively with national labs and won’t pay at all for in-practice services. GROUP CLASSES

You spend hours each week on patient education and you don’t get paid for it. Try hosting education seminars for groups of patients managing the same risk factor — say, diabetes, asthma, or obesity — and charge for it. Such sessions, which provide a more detailed overview than you would normally have time for during a well visit, help enhance compliance and can be conducted in your waiting room or at a local community center during lunch or after hours. But www.physicianspractice.com

do your homework first. Medicare does not cover group counseling at all, and while codes exist for such sessions (99411 — a group setting for preventive medicine counseling and/or risk factor reduction session of roughly 30 minutes in length, and 99412 for sessions up to 60 minutes), not all private payers are willing to reimburse, says Rhonda Buckholtz, vice president of business and member development for the American Academy of Professional Coders in Salt Lake City. You may still be able to charge patients out-of-pocket for the class, but check with your health plans first to be sure you’re allowed to charge for noncovered services, and be sure your patients understand what their financial obligation might be upfront. “I would caution doctors to do careful research with all contracted payers to see what restrictions or requirements they may have before jumping in to provide these services,” says Buckholtz. MEDIA MOGUL

As Shu discovered, becoming a media expert can be rewarding, both professionally and financially. Apart from one-time gigs, she notes, physicians who get put on a one- or two-year retainer by product manufacturers or pharmaceutical firms “can easily make six figures,” during which time they would make themselves available for press and video conferences and advise on product development. Those best suited are comfortable in front of a camera — and still practicing medicine. “Seeing patients and staying current in my field is what makes me relevant,” Shu insists. Be prepared, though, for an unpredictable source of income, and always maintain a professional standard. “You need to be very careful about ethics,” says Shu. “It’s important to be transparent so that viewers understand you are getting paid to mention or promote a product. And you want to be careful not to provide direct medical advice or tell strangers what to do with their health.”

BECOME AN EXPERT WITNESS

You spend plenty on malpractice insurance. Let the legal system pay you back. Attorneys need physicians to help their clients in cases involving an injured plaintiff. Groups such as American Medical Forensic Specialists, Rieback Medical-Legal Consultants, and National Medical Consultants collect physician CVs and connect them with attorneys seeking their area of expertise. For its part, National Medical Consultants in Bayside, N.Y., pays physicians $375 an hour to review charts and perform pretrial work, including written reports and communications with attorneys. For a deposition, in which the lawyers come to you, it’s $2,000 a day, plus any prep work required (normally two additional hours reimbursed at $375 a pop). And they pay $6,000 a day if you go to trial, which is normally scheduled on Monday or Friday to minimize time away from your practice. To maintain credibility, Gene DeBlasio, a pediatrician and president of National Medical Consultants, says legal work should constitute less than 5 percent of your income or you’ll look “like a professional witness.” CLINICAL TRIALS

Though the days of easy money in the clinical trial arena are over, working with pharmaceutical firms remains financially viable for practices that are willing to commit the resources. Upstate Neurology Consultants in Albany, N.Y., for example, has a separate clinical research center with a dedicated staff and research coordinator. The staff’s long-time connections within the industry make it a profitable line of work, but administrator Bill Henderson cautions that federal regulators have toughened up protocols, making it cost-prohibitive for some practices to participate in drug trials. At the same time, he says, pharmaceutical firms are sending more studies offshore, while the flurry of mergers and acquisitions in the industry have wreaked havoc on the continuity of clinical February 2011 | Physicians Practice |

Cover Story research. “How much you can make is all over the board,”he says. “If I told you that you could make $30,000 in a study if your patient participated for the next three years that sounds great, but if you can only recruit one subject and they drop out after six months, you only get paid for the work you’ve done up to that point. You have to work very, very hard for every penny you make in this.”While some practices make upwards of $100,000 in extra income doing clinical trials, most realize a smaller revenue bump. Others never break even. You can search for ongoing clinical trials on clinicaltrials.gov from the National Institutes of Health, centerwatch.com, Veritas Medicine’s Web site pharmalicensing. com, and pharmaceutical firm AstraZeneca’s site for healthcare professionals, clinicaltrialdoctors.com. CHARGE RENT

In the transition to electronic health records, many medical offices suddenly have vacant office space where paper charts were once stored. A little advice? Dust off the cobwebs and put that square footage to work. Physical therapists,

massage therapists, acupuncturists, and dieticians, for example, often have need of professional space and could serve as a passive source of income. According to commercial real estate data firm CoStar in Washington, D.C., national rates for medical office buildings are about $22 per square foot. If your practice owns the building, you can lease to whoever you want. If you rent, however, you’ll have to get permission from your landlord to sublease. (Not all will allow it, and those that do will want final say in who you bring on board — including a review of their credit history.) Remember, though, that fees given in exchange for referrals to your new tenant are illegal under Stark rules. Also, remember to always charge the fair-market value for rent, so you don’t run afoul of any anti-kickback statues. ROUNDUP

If the aforementioned options fail to appeal, there are a few more ways to bring in extra cash: Try marketing your practice to local businesses as a specialist in worker’s compensation physicals and

employee drug screenings, including pre-employment testing. (But be prepared for a paperwork parade.) Consider moonlighting, or taking extra hours at outside healthcare facilities, including local hospitals or urgent care centers, which pay anywhere from $50 to $130 per hour, depending on your location and demand for your specialty. Work smarter. You can boost your profit margin significantly by using resources wisely. You might, for instance, focus exclusively on more complex patients, which are reimbursed at a higher rate, and use midlevel providers for routine care. Reduce your no-shows. Try implementing reminder calls (in addition to any automated system) two days before each appointment, says Atlanta-based practice management consultant Elizabeth Woodcock. At the very least, reach out to patients who missed their last appointment, new patients, and those scheduled for procedures. That leaves time to fill their slot if they suddenly have a conflict. “Reducing no-shows by even two a day — or filling those two slots — can equate to $10,000 or more per year in income (not just revenue),”says Woodcock. As reimbursement falls and overhead costs climb, doctors in all specialties are expressing frustration over having to work harder for the same (or less) pay. One solution is to create supplemental income streams by leveraging your medical degree. It takes an entrepreneurial spirit and, often, a willingness to tread outside your comfort zone, but it also gives you a chance to boost your bottom line — and the personal satisfaction of practicing medicine on your own terms. Hey, it’s either that or picking stocks. n Shelly K. Schwartz, a freelance writer in Maplewood, N.J., has covered personal finance, technology, and healthcare for more than 12 years. Her work has appeared on CNNMoney. com, Bankrate.com, and Health Family magazine. She can be reached via editor@physicianspractice.com.

| Physicians Practice | February 2011

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your hospital September 2011

Why You Shouldn’t Wait

The time is now to start your transition

also inside: technology: CHOOSING THE RIGHT EHR VENDOR

ADMINISTRATOR’S DESK: ELIMINATE DENIALs

CME

ONLINE

instructions/42

in practice: YOUR PATIENT FLOW PROBLEMS SOLVED

Why You Shouldn’t Wait By Marisa Torrieri

Though your practice doesn’t have to start using ICD-10 codes for another two years, now is the time to start preparing to avoid claims denials and other costly practice headaches. Here’s what you need to know to smoothly make the transition.

| Physicians Practice | September 2011

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When it comes to ICD-10, the new code set that takes effect Oct. 1, 2013, what worries Jerra Allen is not the two additional digits or the reams of new disease and diagnosis codes compared with the current ICD-9. Allen, an insurance claims specialist at Miss.-based Hattiesburg G.I. Associates, PLCC, says the biggest challenge will be obtaining the additional information from patients needed to meet the higher level of diagnostic specificity that ICD-10 requires to process claims. “I’m pretty sure a lot of doctors’ offices will have that same issue,” she says. For Jacque Konzelman, practice manager at Sussex County Medical Associates in Newton, N.J., the timing of the switch to ICD-10 — in

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an era of financial and regulatory pressures — is the big stressor. “The problem with all of this is the ability to meet these requirements financially when reimbursement is going down,” says Konzelman. Many practices share these concerns. Yet, given the magnitude of changes practices will have to make — from the way they conduct patient exams to how they process claims — it’s alarming that only 36 percent of 722 physician practices in our 2011 Technology Survey told us their technology is ready for the coming transition to the ICD-10 code set, which will require practices to start using more than 100,000 new alphanumeric procedure and diagnosis codes. What’s more, 22 percent of respondents told us they’re not sure whether their current system will ever be upgraded to handle ICD-10 codes.

Here’s another kicker: Although Oct. 1, 2013, the deadline to start using ICD-10 codes, might seem far away, healthcare organizations will have to take their first step in the transition as soon as Jan. 1, 2012: using Version 5010 of the Electronic Data Transaction standard, which is necessary to transmit the new codes. “It’s amazing how many people don’t even know about the upcoming transition at all, let alone how big it’s going to be,” says Glen Stream, president-elect of the American Academy of Family Physicians, who runs the IT management system for a 230-provider, multispecialty healthcare clinic in Spokane, Wash. “The general lack of knowledge is concerning to me.” Translation: You need to make ICD10 a priority, even though you won’t have to start using the new codes for two years. Therefore, the sooner you start, the more likely you’ll be able to work out training kinks and avoid claim denials. Here’s a start on what you need to know to stay on target for the next 24 months.

illustration: Phil Foster

September 2011 | Physicians Practice |

Cover Story ICD-10 CODES: HOW THEY’LL CHANGE YOUR LIFE

With all the focus on EHRs and meaningful use, many practices haven’t even begun to think about ICD-10. And while the change to ICD-10 is touted by CMS for its benefits (supporting interoperability, accuracy, and quality of data), the magnitude of the conversion is daunting. “This ICD-10 thing is just one more change people have to deal with,” says Stream. “There’s so much going on I think people are saying ‘Enough! I’ll deal with this later!’” While the desire to procrastinate is understandable, the longer you wait the more difficult the transition will be, regardless of whether your physicians code their own charges or your practice uses a seasoned, certified coder. The consequences of not being ready for the changeover to ICD-10 include losing thousands of dollars in claim denials and time spent resubmitting claims. It’s even possible your practice could be liable in a malpractice lawsuit if a diagnosis is coded incorrectly and

in summary Given the magnitude of changes practices will have to make — from the way physicians will conduct patient exams to how they process claims — it’s alarming that only 36 percent of 722 physician practices in our 2011 Technology Survey told us their technology is ready for the coming transition to the ICD-10 code set. Here are some points to remember: Jan. 1, 2012, healthcare organiza• On tions must swap standards for electronic healthcare transactions from Version 4010/4010A1 to Version 5010, which accommodates the ICD-10 codes.

5010, which is incorporated • Version into practice management systems,

EHRs, and any other technology system used to transmit patient data, is necessary for claims, eligibility inquiries, and remittance advices.

but not too much, too soon. • Train, It’s important to train clinicians and

coders on the new ICD-10 code set, but don’t expect them to master the changes all at once. Introduce basic information, and revisit select training the closer you get to implementation.

| Physicians Practice | September 2011

a patient therefore receives inappropriate treatment, says Raemarie Jimenez, director of education for the American Academy of Professional Coders (AAPC). The change from ICD-9 will be a gigantic one: The new ICD-10 CM (clinical modification) codes and ICD-10 PCS (inpatient procedure) codes will replace the existing ICD-9 numerical codes (which are more than 30 years old) with more than five times as many new alphanumeric codes that are longer and more specific. According to the American Health Information Management Association (AHIMA), ICD-10 consists of more than 68,000 codes, compared to approximately 13,000 ICD-9-CM codes. What’s more, ICD-10 codes are longer — ranging between three and seven characters — than their three- to five-digit predecessors. This shift will ultimately create more-specific patient data, and contribute to a greater knowledge base about patient diseases and best practices, according to Patricia (Pati) Hildebrand, a consultant with AHIMA who works with practices. Hildebrand offers the example of applying a code to a patient with hypertension, which represents one of the most common diagnoses in primary care: Currently, hypertension is coded as a single code, with multiple additional codes to describe related illnesses (effects from hypertension on the heart, kidneys, and eyes for example) or complicating illnesses (diabetes, congestive heart failure). But starting Oct. 1, 2013, coders will have several-hundred codes to choose from. Under ICD-10 — except in rare cases of essential hypertension with no known cause or related organ changes or concomitant disease — a “combined” code must be chosen from several pages worth of codes in the manual (codes I10-I15), such as “hypertension plus kidney disease” or “hypertension plus kidney disease plus cardiac disease.” Because codes are more specific, patients will ultimately require

more attention and time per visit in order to input the correct diagnosis and treatment. “Because the coding system will have combination codes, and there are multiple permutations of combinations, the sheer number of possible codes has skyrocketed,” says Hildebrand. “This is going to make creating a superbill/encounter form or coding cheat sheet very difficult, not to mention the additional codes that will need to be added to any pull-down menu, any memorized code list, or any frequently used code list in electronic documentation.” Ready to start training? Circle Jan. 1, 2012, on your calendar. That’s the date practices are expected to start using Version 5010 of the Electronic Data Transaction Standards. THE UPGRADE TO 5010

Before you can transmit the sevendigit ICD-10 codes, you’ll need software that can accommodate the extra digits. Enter Version 5010 of the Electronic Data Transaction Standards. On Jan. 1, 2012, as mandated by HIPAA, healthcare organizations must swap standards for electronic healthcare transactions from Version 4010/4010A1 to Version 5010. Unlike the current Version 4010/4010A1, Version 5010 accommodates the ICD-10 codes, and must be in place before you can start using ICD-10. But 5010 is necessary for more than just ICD10 codes. The technology, which is incorporated into practice management systems, EHRs, and any other technology system used to transmit patient data, is necessary for claims, eligibility inquiries, and remittance advice — which means any vendor or payer your practice does business with will also need to upgrade within the next few months. In addition to upgrading, healthcare providers are expected to complete Level 1 and Level 2 5010 EDI testing by the end of this year. Level 1 compliance ensures that a practice can “create and receive compliant transactions,” meaning it can send and receive information, including www.physicianspractice.com

claims. Achieving Level 2 compliance means that a practice has completed end-to-end 5010 testing with each of its trading partners (insurance companies, software vendors, etc.) and is ready to go. “If you don’t comply with 5010, it’s going to hurt you,” says Richard Temple, an executive consultant with Beacon Partners, at a recent virtual conference sponsored by HIMSS. “It’s going to take you a lot of work to rework transactions, your cash flow is going to be negatively impacted, and there’s also a fine of up to $50,000 per year [through HIPAA] if you don’t comply.” But while the looming Jan. 1, 2012, deadline has put pressure on practices to adopt and test 5010, it has also shed light on the challenge of waiting for vendors to provide the correct software upgrades — whether yours is a small, independent practice or part of a larger healthcare delivery network. A survey conducted by the Medical Group Management Association in June revealed that 30 percent of practices had not received any communication from their practice management software vendors regarding the change to Version 5010. What’s more, 45 percent of respondents had not started their implementation of Version 5010; 46 percent said they have partially completed implementation; 2 percent said they had completed implementation. Sharp Healthcare, a San Diegobased system of hospitals, group practices, and a health plan, began its transition to ICD-10 in June 2009. Yet two years later it finds itself waiting for many of its vendors and trading partners to get themselves ready for 5010 testing. “It’s moving very slow, so I’m concerned we’re going to get hit all at once with everybody knocking on the door saying ‘OK, we’re ready to test,’” says Debbie Coates, Sharp’s IT director responsible for Revenue Cycle Management systems. “I think that’s what’s kind of scary. You don’t know who’s going to be ready when.” www.physicianspractice.com

Practices that haven’t received notice from their vendors need to inquire about the vendor’s timeline for making the switch. Your next step will be based on their responses. If any vendor has no transition plan that it can share with you, says Temple, “run away, seriously.” During his presentation, Temple suggested several questions you can ask vendors and trading partners to assess their 5010 readiness, including: 1. Will you upgrade your systems to accommodate 5010? 2. What is your timeframe? 3. Will you support 4010A1 and 5010 concurrently? 4. Will there be a charge for the upgrade? 5. When will the upgrades be available? 6. Will there be sufficient lead time to test new software prior to the Jan. 1, 2012, compliance date? In addition to asking questions, Hildebrand suggests practices make sure they have updated, written business-associate agreements with their partners that state they “will uphold HIPAA” and “will be ready for 5010 and ICD-10 transactions.” TRAIN NOW BEFORE THE RUSH

Whether you’ve started, completed, or are in the midst of testing 5010 transactions with your business partners, it’s not too early to start making the most of your time while you wait, by starting on other aspects of ICD-10 training. Because the code change is a lot to digest, here are the actions suggested by coding experts and savvy practices: Assess the Situation. The training required for ICD-10 will vary at different practices based on the size of the staff and who does coding. “The small practice needs to look internally,” says Hildebrand. “They need to talk to anyone who has any involvement with the ICD-10 coding. It’s not just the clinicians who need to know the diagnosis coding. It’s the back-office staff, it’s anyone who gives referrals, it’s anyone who has anything to do with their

billing.” As part of its “Assessment Phase,” Hildebrand suggests practices ask themselves: “Who is going to need training?” and “What kind of budget do we have for it?” Give a Good Overview. Training physicians to use more than 100,000 codes would waste a lot of time, as most practices won’t use all available codes. At Hattiesburg G.I. Associates, Allen says the practice has already participated in hourlong ICD-10 training webinars cosponsored by its data clearinghouse vendor Navicure, that have given staff an overview of the changes ahead. Though physicians and supporting staff will require more hands-on training in using the codes later on, taking this initial step has made the task of adopting ICD-10 a lot less daunting for the four-physician clinic. “The sessions have helped us look at the practice as a whole and helped [physicians and staff] understand how the whole practice of gastroenterology will change,” says Allen. Train, But Not Too Much, Too Soon. With two years to go until

the coding changes take effect, there’s no need to fret about getting your staff ready to actually use the new seven-digit ICD-10 codes just yet. Most coding experts agree that actual training on how to use the codes will come in phases, and that it will be at least another year from now before coders and physicians start trying out the new ICD-10 codes while continuing to use ICD-9. “It’s human nature to forget things you haven’t been using,” says Hildebrand. “If you train people all at once, there are going to be people who forget.” More important is to train clinicians on how to gather more specific information at the point of care (to support the more-detailed ICD-10 codes), or train coding staff on how to edit codes to ensure they’re accurate before claims are processed. CHALLENGES AHEAD

The good news is that it’s only 2011, so as long as you’re in the process of implementing 5010, you should September 2011 | Physicians Practice |

Cover Story be on schedule. Still, there are a number of potential challenges likely to arise as the calendar creeps closer to implementation time. Consultant John Dugan, the ICD10 practice leader for market research firm PwC, notes the first challenge that physicians will be faced with: a new burden of accurate code submission, which will be particularly acute at family physicians’ offices. While this may not be a big deal for seasoned coders who have planned for the additional training, it is a big deal for physicians who may have to tweak their clinical practices. “You may have a current list of common diagnosis codes that’s one page long, and guess what? That list will be five pages long,” says Dugan. “You’re going to have a certain panel of tests for [common] conditions. The difficulty is making sure they’re updated.” Dugan says he anticipates a greater number of denials if documentation and procedures lack specificity.

“Ultimately that’s going to come back to the physician,” he says. To help physicians get acquainted with ICD-10, a number of organizations, including the AAPC and AHIMA — which offer full-scale accredited courses to professional coders at large practices and healthcare organizations — also offer short and long coding workshops and webinars that could help physicians think critically about how they might assign the new codes to patients with common ailments. “Even now, we’re finding that providers are not picking out the most specific codes,” says the AAPC’s Jimenez. “From a payer’s perspective, you should be able to tell [them] what you’re treating on that patient. The average person is looking at 40 to 60 hours of training.” At Hattiesburg G.I. Associates, Allen says there will be a greater focus on asking patients the most important questions related to their G.I.

condition, as well as obtaining patient information from a patient’s past physicians. This will be a challenge, says Allen, as “sometimes patients don’t disclose as much as they should.” Therefore, practices should expect a bit of a learning curve and decreased productivity as clinicians get used to life under the new codes. But in the end, the result will be more accurate patient data on common diseases and diagnoses, which will, CMS hopes, improve patient care and outcomes. “The workflow of ICD-10 is not just to deal with the day-to-day billing software,” says Hildebrand. “It starts with how patients are documented. It starts with the very first point of contact with that patient.” n Marisa Torrieri is an associate editor

at Physicians Practice. She can be reached at marisa.torrieri@ubm.com.

Source: Beacon Partners

From ICD-9 to ICD-10

How would some common procedures be coded differently under the ICD-10 code set? Here are some examples, courtesy of healthcare consulting firm Beacon Partners. Example

ICD-9 Code

ICD-10 Code

Z00.129 Routine exam without abnormal findings

V20.2

Routine child or infant examination

Thumb laceration, without nail damage, initial encounter

Z00.121 Routine exam with abnormal findings (Physician/ coder would use additional codes to identify the abnormal findings).

S61.011A Laceration without FB, Right

883.0

S61.012A Laceration without FB, Left

493.92

J45.21 Mild, intermittent, with acute exacerbation

Asthma, acute exacerbation

J45.41 Moderate, persistent, with acute exacerbation

J45.51 Severe, persistent, with acute exacerbation

| Physicians Practice | September 2011

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your hospital June 2012

Cutting Ties The when, why, and how of ending a patient relationship PEARLS: INCREASING REFERRALS TECHNOLOGY: TOOLS TO HELP WITH ICD-10 PATIENT PERSPECTIVE: THE ADDICTED PATIENT

illustration: Brian Stauffer

| Physicians Practice | June 2012

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Cutting The Ties That Bind The when, why, and how of ending a patient relationship By Aubrey Westgate

The prescription abuser, the never-payer, the no-shower, the surly swearer, the stubborn selfdiagnoser — when these problem patients show up at your practice, they grate on your nerves, bring out the worst in you, and ruin your day. What can you do? Patient dismissal is a drastic step that most doctors are loath to take. But some patients go beyond “difficult,” to abusive; some physician-patient relationships fray beyond repair; some patients just will not follow their treatment plan; and some patients do not pay their bills. Internist Toni Brayer, the regional chief medical officer at Sutter Health, a large network of physicians and hospitals in Northern California, says that while dealing with tough patient problems is part of being a good doctor, there are some things that physicians and practices should not tolerate. One physician Brayer knows, for instance, recently discharged a patient who repeatedly demanded a specific treatment for his thyroid condition. Not only did the physician disagree with the treatment requested, the patient failed to take his prescribed medication, neglected to follow up with testing, and repeatedly missed appointments. “It creates a really unsafe environment for the patient and frankly, great [legal] risk for the physician,” Brayer says. “The doctor cannot in good conscience go against good medical practice.”

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June 2012 | Physicians Practice |

Cover Story Yet instead of discharging patients like this, many physicians suffer through unpleasant encounter after unpleasant encounter without taking any action, often to no one’s benefit. If you’re one of them, consider this: Not only will failing to discharge the patient cause you stress and potentially endanger the patient, it could also cause some serious legal issues for you down the road. “I can hardly think of a time where a [malpractice] case went to trial and the physician did not say to me, ‘I knew that this patient was bad news,’ or ‘I hoped that she would go away on her own,’ or ‘I didn’t take the time to figure out how I could terminate the patient,’” says Susan Keane Baker, a consultant in risk management and patient relations based in New Canaan, Conn. “It’s not the patient who’s terminated that keeps the doctor up at night. It’s the one who should have been terminated but wasn’t.” Before you dismiss a patient, you should take all reasonable steps to make the relationship work. But if those good-faith efforts fail, don’t be afraid to discharge the patient. Just be sure you do it in the right way. BEFORE YOU DISCHARGE

Some of the key scenarios in which discharging the patient may be necessary are when a patient: • Is dangerous, threatening, or abusive; • Fraudulently uses controlled substances; • Files a lawsuit against you;

in summary If you’re convinced you must sever the physician-patient relationship, follow these steps:

your practice has patient-dis• Ensure missal policies in place that comply

•

with your state’s laws.

Thoroughly document the reason for the patient’s dismissal in the medical record.

the patient a letter of dismissal, • Send providing an adequate notice period. staff members of the patient’s • Inform dismissal and instruct them how to handle any contact from the patient.

| Physicians Practice | June 2012

• Refuses to follow recommended medical treatment; • Frequently misses appointments without notice; • Repeatedly fails to pay bills despite his ability to pay and/or your efforts to provide him with a suitable payment plan. But there is no universal legal standard for determining the appropriateness of patient dismissal in different scenarios, says Steven Kabler, an attorney at Denver-based Jones & Keller. “From a malpractice and medical board standpoint, a physician can basically discharge a patient for any reason he wants, as long as it is nondiscriminatory and doesn’t violate [the Emergency Medical Treatment and Labor Act] or other laws, or puts the patient’s health, safety, and welfare at risk,” says Kabler. But those are big qualifiers, requiring a working understanding of different areas of the law. It’s best to have a patient-dismissal policy in place that your attorney has reviewed. Keep in mind that dismissal should be a “last resort,” says James Saxton, attorney and chair of the healthcare litigation and risk management group at Stevens & Lee, a law firm based in Lancaster, Pa. Prior to dismissal, it is critical to first take steps to attempt to remedy the situation, and carefully document those steps in the patient’s chart. For instance, if you are contemplating discharging a patient for nonpayment, consider offering additional payment options, such as payment by credit card or a mutually agreed upon payment plan. Or if you suspect that a patient is abusing prescriptions, the basis for the suspicion (if not hard evidence) should be discussed with the patient and documented, says Saxton. Following that discussion, if the patient’s behavior continues to support suspicion of abuse, the patient may then be discharged from the practice, he says. Beyond the legal implications of discharge are the ethical considerations. “The physician-patient relationship is extraordinarily important,” Saxton says. “It’s important to

the patient, it’s something that they rely on, it’s something that’s special in the law. We tell physicians all the time they’re going to have challenging patients, they’re going to have personality conflicts, but they’re an important part of it … and they should work hard to try to make it fit.” DISMISSAL TIME

When a patient’s behavior does not change despite your efforts and warnings, then severing ties may be your last option. But tread lightly. There are guidelines on the timing and process of patient dismissal, as well as simple best practices for any professional who deals with the public, especially one vulnerable to lawsuits. If you do not follow them, you could be in trouble. A disgruntled discharged patient, for instance, may attempt to sue you for abandonment. A “good relationship between the patient and physician often is what protects the physician from professional liability claims,” Saxton says. “If you terminated them in sort of the ‘wrong way’ — you’ve left a bad taste in their mouth — you might be exposing yourself to a claim.” Discharged patients may also issue complaints to your state medical board, says Kabler. If the board were to determine that in treating the patient you did not meet “the generally accepted standards of medical practice,” penalties could range from a letter of concern to public admonition to a revoked medical license. “Keep in mind that the relationship between a physician and patient is for the benefit of the patient, and regulatory bodies regularly view it that way,” says Kabler, who formerly served as general counsel to the Colorado Board of Medical Examiners. That’s why it’s essential to ensure that you are familiar with all of your state’s requirements related to dismissal before beginning the process, says Robin Diamond, an attorney and registered nurse who serves as senior vice president of patient safety and risk management at The Doctors Company, a nationwide malpractice insurer. www.physicianspractice.com

If you do not have a dismissal policy at your practice, Saxton recommends seeking counsel with an attorney to help you develop one. “It’s not a big expensive project, but a good healthcare attorney can unemotionally set the stage for the physician and keep them out of the potential pitfalls,” he says. Once a policy is in place, it’s not necessary to contact the attorney each time you decide to discharge a patient, but Saxton does advise seeking counsel when less common or difficult dismissal situations arise. Baker says it’s also a good idea to contact your professional liability carrier to determine what its policies and recommendations are for patient dismissal. Again, you do not need to contact the carrier every time you choose to discharge a patient, but you should ask the carrier to inform you if it makes changes to its policy or sample letter. That way “you will have the correct information about what exactly is involved with terminating a patient,” she says. Finally, check your contract with the patient’s insurer to be certain you are complying with it, says Diamond. INFORM AND DOCUMENT

Next, document in the patient’s chart the reason for dismissal

More online: Looking for more guidance on discharging a patient from your practice? Visit www.physicians practice.com/patient-dismissal for tips and tools on properly ending the doctor-patient relationship, including: • “Four Ways to Salvage the Physician-Patient Relationship”: Your guide to handling “difficult” patients. • A sample patient dismissal letter to customize for your specific situation. • A sample patient dismissal policy to utilize in your office.

www.physicianspractice.com

as comprehensively as possible, says Kabler. In the event that the patient makes a complaint or claim, thorough documentation will help prove to a third party that you had a “valid reason” for patient dismissal, that the reason was not discriminatory, and not in violation of any laws. The documentation should also be straightforward and objective, says Saxton. In addition, notify all of your staff members of your decision to discharge the patient and instruct them how to handle any contact initiated by him, says Baker. “You don’t want a staff member to inadvertently reopen the physician-patient relationship if a patient calls and says, ‘I would like an appointment,’” she says. Remember that the rules of patient confidentiality still apply: Staffers should be told only what they need to know to do their jobs. Another good policy is to identify one staff member to handle all of the discharged patients’ questions, requests, and complaints, says Kabler. That way, as soon as the patient contacts the office, your staff will forward his inquiry to the employee who knows how to handle the situation appropriately and calmly. THE BREAK UP

Finally, notify the patient of his dismissal by providing him with a dismissal letter. This letter should reflect your concern for the patient and your hope that he will find a new physician who will better meet his needs, says Saxton. “Take a little extra time to make sure if a third party looked at your letter that they would say, ‘This doctor is professional and is compassionate about terminating this relationship with the patient.’” In the letter, include: • The reason for dismissal. If the reason is supported by objective data (for instance, the patient repeatedly failed to fill prescriptions, evidence he was not complying with his treatment plan), include it in the letter. If the reason is more subjective (for instance, the patient is rude to staff members), use a more “gen-

eral” approach, says Diamond. For instance, she suggests writing, “My concern is that you and I no longer have a therapeutic relationship, and I can’t treat you and do for you what I need to do as your physician.” • Record release information. Provide the patient with a copy of his medical record, says Kabler. In the dismissal letter, state how the patient can request a copy and/or how he can request it to be sent to another provider. If he asks you to forward it, have him sign a release indicating that he wishes you to do so, says Diamond. If you normally have a fee for copying and sending the record, it’s best to waive it. “Absorbing that [cost] as a matter of good will is probably good strategically,” says Saxton. • Referral guidance. Instruct the patient to find a new physician and provide him with contact information for nearby hospital or medical society referral services, says Baker. Do not specifically recommend another physician, as the patient may claim that in following your advice, he visited the physician and his health suffered as a result, she says. State laws vary regarding the required method of delivery for dismissal letters, says Saxton. Make sure you send the letter using the appropriate method. If the letter is sent via first class mail, in addition to the required method, the letter is presumed received. Finally, save the delivery confirmation, put a copy of the letter in the patient’s record, and send a copy of the letter to your professional liability carrier, if it requests it, says Baker. “If you should need it, you want to be able to access it quickly.” IN LIMBO

Your dismissal letter must also include information regarding the notice period. This is the amount of time you will continue to provide the patient medical care after sending him the termination letter, to June 2012 | Physicians Practice |

Cover Story give him time to find another provider. States usually have statutes or recommendations for physicians regarding the duration of this period, usually ranging from 15 days to 30 days, says Diamond. Though such policies are usually nonbinding, they are smart to follow, says Kabler. Medical boards will likely use those policies to determine whether you followed the standard of care, should a question or complaint arise, and in the event of a malpractice lawsuit, you don’t want to seem callous. But if it is not practical for the physician to provide the patient with the recommended notice period — for instance, if the patient is dangerous — the board will likely take that into account, Kabler says. Also, if it’s likely that the patient will encounter difficulty finding a new physician — for example, if he requires highly specialized care or lives in a rural location — it’s smart to provide him with a longer notice period than required, says Diamond. Be sure to include the final termination date in the dismissal letter. COMPLICATIONS

In general, the dismissal process and the dismissal letter should remain consistent regardless of the reason for termination, says Baker. Still, there are a few variations to consider: When closing your doors or cutting back. Follow the standard termination

process. However, consider providing patients with notice sooner than required, says Kabler. This will make the process easier for both of you. Also, consider creating a website or altering your current website to provide patients with discharge information and a link or e-mail address to which they can send medical record requests. If you encounter a record for a patient you have not treated in a significant amount of time, follow the standard termination process, says Diamond. “Never assume that … the patient doesn’t still believe they’re in a relationship with [you],” she says. When a patient is “difficult.”

Follow the standard termination process. If the patient is having a 6

| Physicians Practice | June 2012

problem with a staff member, remove the employee from the patient’s care during the termination period, says Kabler. If the conflict is with the physician, another physician at the practice may treat the patient during the notice period. If the patient requests the primary physician specifically, “it’s OK for the physician to say no, unless the replacement physician can’t provide the care that’s necessary,” says Kabler. Finally, send a copy of the patient’s medical record directly to him at the very beginning of the termination process through certified mail. “Be proactive,” says Kabler. “Difficult patients always present difficult issues later.” When a patient sues. Just because a patient makes a claim against you doesn’t mean the physicianpatient relationship is terminated. Though it may be difficult, follow the standard termination process and continue providing the patient with emergent care until the final termination date, says Kabler. When a patient doesn’t pay. Do not withhold the patient’s medi-

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cal record pending payment, says OUR VIRTUAL Baker. Then, determine how to BUYERS GUIDE deal with the patient’s unpaid YOU CAN: bills. Think twice before sending a collection agent • Flip through theafter pages!him. It might push by thekeyword! patient to make • Search a claim or complaint, she says. • Download to your desktop! “Sometimes you make decisions, • Forward to a colleague! and if you considered the bigger Find it at www.www.Physicians picture, you just wouldn’t make thePractice.com/buyers-guide. same decisions.” n Aubrey Westgate is an associate editor at Physicians Practice. She can be reached at aubrey. westgate@ubm.com.

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What You Should Know Before Taking Yours For a Spin

TECH SURVEY: WHAT ARE YOUR PEERS BUYING? Finance: UNDERSTANDING THE LATEST PAYER RANKINGS

EHRsGo

The case for connecting to an EHR via a smartphone or tablet inside or outside your medical practice

By Marisa Torrieri

t’s 2 a.m. and 10-yearold Johnny’s mom calls because he has an ear infection. She knows he’s allergic to something, but she’s not sure what. In the past, Johnny might have suffered hours of pain and a perforated eardrum because his primary-care physician couldn’t get to his charts and prescribe appropriate medication

| Physicians Practice | July/August 2012

in a timely fashion, says pediatrician Barbara Morris, chief medical officer of Community Care Physicians, a 200-physician practice with locations throughout the Albany, N.Y., area. Today, now that a growing number of physicians at the practice are equipped with Apple iPhones and iPads that connect to Community Care’s EHR, patients like Johnny get

care and relief more quickly. And that’s just the first of many benefits. “It’s an immediacy of clinical information,” says Morris. “Sometimes it’s a life and death [situation], sometimes it’s convenience, sometimes it’s being able to initiate a treatment.” Community Care is one of a growing number of practices, large and small, whose physicians are connecting to EHRs via mobile means — especially via media tablets. Physicians are warming up to iPads in particular, according to several studies, and because many are eager to use the devices to connect to their EHR systems, some observers are wondering whether the iPad will do more to encourage EHR adoption than any government stimulus or vendor promotion ever could.

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But as with any new technology, there also are some limitations to mobile EHRs that will take time to work through. For physicians on the fence, here’s some guidance on the benefits and limitations of the emerging mobile EHR. THE STATE OF MOBILE EHRs

Mobile devices have come a long way. Today’s smartphones, for example, allow a physician to do everything from download medical-reference apps to view high-resolution X-ray images quickly and easily. But the introduction of Apple’s iPad in April 2010 has done more to advance the concept of a truly mobile healthcare delivery system than any other device, software release, or technological development — including, perhaps, the Internet itself. The iPad’s laptop-like screen size (10 inches), its phone-like portability (it’s about 1.33 inches thick and weighs 1.3 pounds, depending on the version), and its powerful battery (up to 10 hours on one charge), seem to combine to make it a busy physician’s dream gizmo. Further explaining the iPad’s success in mobile health has been sheer serendipity: Its release coincided almost exactly with the implementation of the final Stage 1 rules for the government’s EHR incentives, which, in turn, spurred the adoption of EHRs. According to our Physicians Practice 2012 Technology Survey, Sponsored by AT&T, taken by 1,369

www.physicianspractice.com

physicians, practice managers, and other healthcare workers in the first quarter of this year, use of mobile technology has risen substantially. More than half of all practices have a fully implemented EHR, and 63 percent of respondents said they use mobile devices for work purposes. Of those, nearly half (45 percent) use an iPad or other media tablet, and 82 percent use a smartphone. All this has given rise to a new category of EHR — one that runs on a smartphone and/or media tablet — that most vendors are working on developing, if they don’t have something already. Most “mobile EHRs” are extensions of desktop-computer EHRs: They reside on mobile devices as “thin-client” applications (either as Web-based apps or apps that are native to the tablet’s platform, such as Apple’s iOS) that connect to the practice’s EHR through the device’s Web browser. While some EHR apps conform to a device’s particular operating-system constraints so the EHR looks natural on a smaller screen, not all of them do. A few vendors have made attempts at developing EHR systems to run natively on the iPad. For example, the former ClearPractice launched an iPad-only EHR program called Nimble as far back as 2010, but has since changed its name and corporate focus. More

recently, Epocrates introduced an iPad-native version of its Web-based EHR. Most vendors, though, are working on (or have released) tablet applications of their existing products, rather than tablet-native tools. “Most of what we see with [mobile EHRs] is really Apple iOS apps, and a handful of Android apps,” says Jonathon Dreyer, senior manager for mobile solutions marketing at Nuance Healthcare, which makes voice-recognition technologies for use in both desktop and mobile environments. “Mobile EHRs are being developed by a number of the legacy EHR manufacturers and new manufacturers. Most vendors have created a frontend ‘shell’ that will let you connect to an EHR anytime, anywhere.” Jonathan Bertman, a practicing physician and president of EHR vendor Amazing Charts, says because most EHR companies haven’t redesigned their electronic charting to support a fully mobile or iPad experience, most things physicians need to do inside their EHRs — especially typing in the absence of a physical keyboard — will be either difficult or impractical to perform natively on mobile devices. WHY DOCS ARE RAVING

In addition to helping little Johnnies with eardrums on the brink of rupturing, having a mobile EHR allows Community Care physicians to do more when they’re not in the office. And, says Morris, it gives the practice a “competitive advantage” when it comes to attracting younger, more technology-savvy doctors.

July/August 2012 | Physicians Practice |

Cover Story That’s why physicians who work for the practice only need ask to receive iPhones and iPads that connect to the practice’s EHR system — even though these doctors are already given Lenovo ThinkPad laptops for working at home. “There’s multiple layers of benefits,” says Morris. “It makes the physician more efficient away from the office, [and] it allows for more efficiency in the office. It allows the physicians to see their schedules before their days [start], and it allows for better patient care because of the easy voice dictation built into it, so the patient information is in the chart the next day. If I’m gone Friday, any business I conduct is in the system before Monday.” Andrew Barbash, a former practice-based neurologist who now works at a Silver Spring, Md., hospital, owns an iPhone, Motorola Droid smartphone, and an iPad. Armed with his gadgets, Barbash is constantly on the go, e-mailing clinicians, e-mailing patients, conducting mobile videoconferences, and showing images to patients. He uses ve medical apps to look up information. ho ha ose w R ng th ted an EH o m A And that doesn’t even includeadoall p of the things he does related to using his mobile EHR, which he accesses via a thin-client Citrix Gateway receiver.

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P FUTURE

“There [are] a lot of things that have been tried in healthcare that never achieved a rate of adoption until they were mobilized,” says Barbash. “Physicians don’t have downtime between their [patients]. And so, everything they can do to do as much of their viewing, results management, communication, documentation, orders checking, and follow-up requests from nurses on their mobile device gives them that much more efficiency. There are key elements of functionality within the EHR that unless a physician could actually do them while they are moving around during the day or while they are on break, they literally wouldn’t be able to use the EHR as effectively.” Washington, D.C.-based orthopedic surgeon Denis Harris, proudly “paperless since 1983,” has been using the latest version of his EHR for two years. These days, he appreciates how easy it is to do things while on the go with his iPhone and iPad, with which he can access his LifeDox EHR through a thin-clientbased connection. “A [mobile] EHR shows you in real time what you’re doing

ECHOSRTS

and make them more efficient when they are in the office.

vast majority of “mobile EHRs” • The are not standalone, exclusively mobile products. Rather, most are extensions of existing EHRs; they reside on mobile devices as apps.

are disadvantages to accessing • There an EHR through a mobile device: For

example, touch-typing is difficult without a traditional, QWERTY keyboard.

| Physicians Practice | July/August 2012

Today’s smartphones and media tablets are sleek, fast, and fun — so it’s easy to get lost in their sex appeal and forget that in reality, mobile technology isn’t quite as fast as your desktop computer. What’s more, it’s also not as fast as the wireless industry says it is. For starters, cellular network speed — the speed at which a user can transmit and receive data over a cellular, as opposed to a Wi-Fi, network — is overhyped. Though fourth-generation (4G) wireless smartphones and tablets promise speeds of 1 gigabit per second, they rarely achieve that speed in actual usage. A variety of influences, from network traffic to the amount of

Which of the following mobile communication devices do you use in the performance of your job? Please check all that apply.

devices help physicians do • Mobile more when they’re not in the office,

•

MOBILE DISADVANTAGES

MOBILLEOGY TECHNO

A growing number of physicians are connecting to their practice’s EHR through a smartphone or media tablet. Here are some benefits and drawbacks to consider:

Using mobile EHRs, physicians can see their schedules, access patient notes, e-prescribe, and coordinate care.

with another doctor,” says Harris. “EHRs are getting better and better, and newer ones allow patients to be involved … I’m an orthopedic surgeon, so 40 percent of my practice comes from another doctor, and [information] can get lost in translation between different doctors. In the past, the patients would have to carry charts or bring pictures or whatever.”

Do you use any mobile devices in the performance of your job? n Yes (62.6%) n No (37.4%)

n Smartphone (iPhone, Android, BlackBerry, etc.) (81.9%) n iPad or other tablet computer (44.9%) n Special technologies that allow me to monitor aspects of my patient’s health status without them coming to see me (4.2%) n Other (please specify) (6.7%)

Source: 2012 Physicians Practice Technology Survey, Sponsored by AT&T www.physicianspractice.com

Cover Story bandwidth an application requires, slow down data-transmission rates. “There’s a lot of hype behind 4G,” says Thomas Handler, a physician turned technology consultant and research director with Gartner Group. “There’s a huge potential difference [between 3G and 4G], but in reality it isn’t as fast.”

medical speech recognition technology. “I can carry data on 35,000 patients and I can carry them on my iPhone and iPad, and interact with Nuance speech recognition on it, and I can look things up,” says Harris. “I can’t possibly remember 35,000 patients so it’s very handy having it available.”

“It makes the physician more efficient away from the office, it allows for more efficiency in the office.”

TIME COUNTS

Barbara Morris, healthcare executive

This is something to consider if you need access to the Internet anytime, and anyplace. Most of the time, however, you’ll probably access your network via a Wi-Fi connection at your practice, hospital, or home. Wi-Fi is usually faster than 4G and is not subject to the same restrictive data-transmission caps that cell carriers impose. Networks aside, there are other disadvantages to accessing an EHR through a mobile device instead of the computer. Many physicians will admit that typing is hard sans a traditional, tactile QWERTY keyboard. Harris gets by this by dictating notes into his EHR via cloud-based,

For Barbash, the “ultralight” Bluetooth-enabled Targus keyboard is a constant companion. Dreyer, however, is skeptical that special keyboard accessories for mobile devices deliver the same functionality. “Even [with] a detachable keyboard, it would become extremely cumbersome if you had to carry a device along with you,” he says. Many iPad users, though, have gotten used to carrying their devices in one of the many available cases that include Bluetooth keyboards. Or a practice could simply have keyboards available to iPad-carrying physicians in each exam room, so they can plug in as needed without

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having to carry them around. Another challenge: security. “It’s easier to steal, lose, or break these devices” than a laptop, says Handler. Plus, as physicians are more likely to transmit regular, unencrypted text or e-mail messages when using a mobile device, the risk of being found guilty of a data breach (and having to pony up fines and suffer penalties for violating HIPAA) increases. “I encourage every person to password-protect their phone,” says Barbash. READY TO GO MOBILE?

Before buying a bunch of iPads for your docs, consider: 1. The EHR factor. Think about

the mobile friendliness of your EHR or any you’re contemplating buying. If you have an EHR that doesn’t offer a mobile app, find out what the vendor’s plan is for mobile access, and when it expects to execute on those plans. For practices still shopping for an EHR that want the option of mobile access, it’s important to explore how EHRs you are looking at are leveraged on mobile devices. “My advice is to be sure you can access the charts from your home without extra cost, and from your smartphone without extra cost,” says Bertman. “Physicians should also be warned that they can’t expect the same experience [from

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mobile devices].” But make sure that you understand the nature of the experience your doctors can expect; insist, at a minimum, on seeing a demo run on an iPad. Talk to a vendor’s current users, and ask those users about the extent to which their physicians are accessing the EHR system via mobile devices, and how they like it. 2. Financial feasibility. Assuming

your EHR has a nifty mobile-app companion, hardware and service costs can be significant. Tablets typically run $300 or more apiece. Those with 4G capability cost more and are useless without accompanying cell coverage. Again, the cell plans come with data caps that your physicians will likely bump up against if they’re using cell networks routinely to connect on their iPads. Practices that invest in iPads for their physicians (and want to keep a lid on expenses) might want to purchase Wi-Fi-only devices, giving the doctors the option of cell-enabled devices if they want to pay for the extra cost of the hardware and the cell coverage. 3. Life/work style. While media tab-

lets are great, physicians should be careful not to be seduced by their physical features. Instead, they should look realistically at the device and see if it is something they would use, if it would benefit them, and how it would benefit them. “I’d advise a physician to only get an iPad or smartphone if they want it for reasons other than an EHR,” says Bertman. “The one caveat is if an EHR company has specifically designed it for an iPad. The dermatologist I share space with uses this kind of EHR and says good things about it. However, I believe that unless you can actually use it in your practice to prove it works — and can do so without impunity if you decide it doesn’t work for your practice, meaning you can get a free trial or full refund — I’d recommend holding off for another nine months to a year. The market and technology is advancing, and 6

| Physicians Practice | July/August 2012

many vendors will be gone within that time period, I suspect.” For Barbash, being able to use mobile devices to access his EHR not only complements his fastpaced work style, but it also helps him to satisfy his patients. “Yesterday, I walked into a patient’s room, the family was there, and I pulled out the iPad and logged into the EHR to show them some scans,” Barbash recalls. “Their

response was, ‘Oh my God, I didn’t realize you could do that’ and ‘that’s incredible.’ They were able to hold it themselves. It actually gave us a much more personal interaction while we were collectively looking at information as opposed to if we were using a computer screen.” n Marisa Torrieri is an associate editor

with Physicians Practice. She can be reached at marisa.torrieri@ubm.com.

The iPad Effect Solo family-medicine physician Jeffrey Gladd of Fort Wayne, Ind., can’t wait until his EHR vendor unveils an iPad-ready version. Though he uses a Wi-Fi-ready MacBook Air laptop, “I’d much rather have a mobile EHR on an iPad so I can quickly, if I’m outside the office, access those charts,” Gladd says. “When Hello Health comes out with an iPad EHR application, I’ll just be able to turn on my iPad and do all of my EHR functions in one convenient location, instead of taking the steps right now it takes to get onto the electronic health record. When I’ve got a full EHR on the iPad, I’ll cut down on two steps and only carry one device.” (The iPad version had not yet been released at this writing, but was due soon.) But while Gladd already had his EHR before his vendor announced it would offer a mobile EHR iPad application to accompany it, the growing number of iPad-loving physicians like Gladd makes one wonder whether the sheer existence of Apple’s popular media tablet has, to some extent, prompted physicians to purchase EHRs when they otherwise wouldn’t have. After all, many doctors use their iPads in a way they never used their mobile phones — as light but robust electronic companions that go from home to exam room to dinner at a restaurant. Armed with the 1.3-pound iPad, a physician can do everything from touch-typing patient notes to looking up patient charts much more easily than she could with a smaller-screened smartphone.

For this reason, Steven Ferguson, patient management officer for EHR vendor Hello Health, says the iPad could be the magic device that gets some physicians EHR-ready. “Before the introduction of the iPad, I was rather skeptical about the viability of a mobile EHR,” says Ferguson. “But now that the third real version of the iPad is out, the user experience is through the roof.” Others, like physician Jonathan Bertman, president of EHR vendor Amazing Charts, say that even with its high level of sophistication, the iPad doesn’t have enough functionality to be used for sole EHR access. “iPads are meant to point and touch, and getting through an encounter would mean hundreds of touches,” says Bertman. “So until EHRs are really designed for tablets, I don’t think that will happen.” And while the debate continues on whether the iPad is a true catalyst — a technology trigger that compels physicians to purchase an EHR — there is no question a growing number of physicians will start to see the ability to use an EHR on their iPad as a market differentiator. In other words, vendors that offer iPad functionality (such as through an app) with the purchase of an EHR will find themselves at a competitive advantage with an increasingly iPad-savvy physician audience.

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The Right Ancillary Services Can Reap a Bountiful Harvest

Technology: YOUâ&#x20AC;&#x2122;VE INSTALLED AN EHR. NOW WHAT? operations: CODE RIGHT THE FIRST TIME

The Right Ancillary Services Can Reap a Bountiful Harvest

By Marisa Torrieri

Until 2011, Washington Radiology Services, a multi-location practice in the nation’s capital and suburbs, offered the same basic two-dimensional mammograms as most of its peers. So when the practice decided to invest millions in more than a dozen 3-D mammography units (plus related software upgrades and workstations), it bet on the premise that patients would be willing to spend extra money out of pocket for a service not yet covered by commercial payers.

“We invested in [them] because we believe it’s the best technology available for patients,” says administrator Patrick Waring, noting that patients pay a $50 fee to undergo testing with the

| Physicians Practice | April 2013

3-D machine, a process also known as breast tomosynthesis. Waring declined to specify exactly how much the group spent on the technology. Fewer than 18 months later, the investment has started to pay off in both tangible and intangible ways. To date, 35,000 patients have opted for 3-D scans, opening up a new revenue source for the practice and increasing the frequency of related breast-care services such as biopsies. Best of all, the machines, which work by rotating around the breast in an arc to create images at up to 70 different angles, help physicians detect cancer sooner. “This allows the radiologist to see past architectural distortions,” says Waring. “It gives them better information for detecting cancers and reducing false positives.” Breast tomosynthesis is cutting-edge diagnostic medicine. But for Washington Radiology, it also represents a way to grow its business the old-fashioned way: by offering its patient base an indemand service, and asking them to pay for it. What the practice has found is that patients are not only willing to pay for services they value — they’re happy to. Your practice can follow this path, too. Driving new revenue through ancillary service lines can be a bulwark

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against the declining revenue and increasing overhead common to modern practice, and the services can be big patient pleasers. But be warned: Not every ancillary service is right for every practice. The key is to pick services your patients want and need, that provide them a legitimate benefit, and that you can perform without major disruption to your regular operations. TRADITIONAL REVENUE STREAMS

Before you rack your brain for an ingenious instant-millionaire idea, consider some of the less-glamorous, traditional ways to make a little extra money. Former anesthesiologist William Dirkes is president and chief research officer of Cincinnati-based Sentral Clinical Research Services, LLC, which helps office-based physicians conduct pharmaceutical drug trials. Dirkes estimates that only about 5 percent of practicing physicians conduct drug trials in their practices, due to worries about the process, the potential startup costs, or the ethics. The upfront work includes researching the drug trial and getting patients signed up, among other tasks, and some physicians are uncomfortable with allowing their patients to be part of an experiment.

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“It’s not just something you can slap onto your practice,” says Dirkes, adding that initial training on ethical issues and research on the drug and disease can take about five hours. Physicians will also have to spend 15 minutes or so a week to keep up with what’s going on. “It’s not a lot, but it’s not like just writing an order for a test.” But if you can invest the time, you’ll reap the benefits. “I had a couple of physicians last year who increased their income 10 to 20 percent,” says Dirkes. Your patients can benefit, too. If physicians are looking to improve outcomes for a particular population — say, diabetes patients — offering a cutting-edge medication might make a huge difference. Bone density testing is another common, and seemingly easy, revenue opportunity. But be careful: Experts say this service works as an add-on only if it can be done for a high volume of patients. “Bone density testing used to have a fairly high reimbursement, and therefore the investment in the bone densitometer used to have a fairly high [return on investment], but the bone densitometer tool is very, very pricy,” says Nina Grant, vice presi-

dent and agency managing director for Practice Builders, and managing partner for Ancillarypractice.com. Because insurance typically covers bone density testing only once every few years for patients in a certain age range, the patient base would have to warrant it. To get the maximum financial benefit, a practice would probably want to consider marketing bone-health testing as part of a larger, exercise- and nutrition-based program, says Grant. In such a program, practices can ask patients to pay out of pocket for more frequent testing, can offer the testing to a wider range of patients, and can offer additional ancillary services within the context of an overall wellness program. Moreover, practices starting such a program might want to refer the bone densitometry out until they see a large enough volume to justify the capital expense. Before upgrading all 15 machines to include the 3-D software, Waring says his practice installed software on two machines for a four-month trial period at one location. “What if only 20 percent of our patients decided they wanted this technology? We would have only needed one 3-D machine at each office.”

April 2013 | Physicians Practice |

Cover Story THINKING CREATIVELY

Miami-based primary-care physician Oliver Di Pietro has spent more than 20 years offering a wide variety of ancillary services — including abdominal ultrasounds, pelvic ultrasounds, bone density tests, and nuclear stress tests. But, according to Di Pietro, the additional revenue from these ancillary offerings paled in comparison to his latest venture: a ketogenic enteral-nutrition weight loss program called the “KE Diet.” “The most lucrative endeavor that I did has been my fight to reverse obesity in my practice,” says Di Pietro. In 2011, he began offering the 10-day program, in which patients receive calorie-controlled nutrients through feeding-tube infusions. “I’ve seen a dramatic improvement in diabetic control, reversal of metabolic syndrome, improvement of cholesterol level, and a healthier appearance and lifestyle of the patients.” The practice charges patients $1,500 for the program, and so far 200 patients have completed it. The costs include equipment, nutritional formulas, lab work, three office visits per week for monitoring, and training on how to use the tubes. As an added bonus, he is earning additional revenue by licensing the weight-loss program to other physicians. FINDING YOUR NATURAL FIT

Making money is great, but most physicians need to do something they’re happy with and that fits their personality, says North Charleston,

in summary Find the right ancillary medical services to offer and your practice will boost its bottom line. A few points to consider: sure your patient population • Make justifies any high-tech purchases.

sure you choose a service that • Make is clinically relevant. you start offering any new • Before service, it’s important to check for

•

possible legal conflicts.

Take your patient demographics into account in your choice of ancillaries.

you invest in new technology, • Ifmake sure you market your new service to patients.

| Physicians Practice | April 2013

S.C.-based, solo doc Craig Koniver, a self-described “organic medicine physician” who now makes at least one-third of his income from products and services that are complementary to basic patient visits. A few years ago, Koniver stopped taking traditional insurance and made the switch to a direct-pay, membership-based practice focused on natural health and medicine. In addition to practicing medicine, Koniver offers a number of ancillary services, from nutritional IV therapies to consultations with docs who want to incorporate naturalhealth ideas into their practices. He also sells his own branded nutritional health supplements online. “I’m a big believer in nutritional supplements and how they have a huge benefit to health,” says Koniver. “It has provided a tremendous revenue stream that’s consistent year after year, and it helps the patients.” Experts advise doctors to offer new services that add value to their existing practices and that their patients actually want. It turns patients off when practices just seem to be trying to make a buck, says Grant. “Clinicians need to follow dollars that are already in the market, and … choose niches that are clinically relevant, rather than investing in, say, a hair removal laser because an eloquent equipment rep convinces them to do so,” she says. Grant recalled seeing a poster for a gynecologist offering eyelash enhancement. “I was confused and put off, wondering ‘Why would my gynecologist help me with my eyelashes?’” FIVE IDEAS

Still not sure which service to add? Grant says the following are among some of the most profitable service additions for physician practices that don’t require a lot of investment. 1. Hormone testing/balancing.

Today, there are a number of supplemental hormones that can ease patients into menopause or andropause, ease depression, or improve other health conditions. As such, testing for hormone deficiencies is a growing area of medicine, says Grant. But as with any test, make sure offering these

has a purpose. “The doctor really has to know what they’re going to do with the information,” says Grant. “You don’t want a doctor adding tests just for the sake of adding tests. That’s not ethical.” 2. Cosmetic enhancements. While

most physicians know about Botox, there are other cosmetic enhancements (such as body contouring) that a growing number of consumers are interested in. These services might make sense for some primary-care physicians, so long as the appropriate safety protocols are followed, and physicians have the market demographics (middle- to upper-income patients) to support it.

3. Pharmaceutical dispensing. If

the patient base warrants it, and your state’s medical board doesn’t prohibit it, offering pharmaceutical dispensing might make sense for your practice. In-office dispensaries are more convenient for patients and may improve patient-compliance rates. Practice administrators should be warned that some physicians might see adding a dispensary as a conflict of interest. “Some physicians may be concerned that their prescription behavior may be influenced by the potential income,” says Grant.

4. Weight-loss/nutrition programs.

Want to make your practice more whole-health focused? Consider adding a nutrition counselor to help design weight-loss programs (including meal planning, monitoring, and counseling) with patients. Offering medical food (such as snack bars that help ease hunger and lower cholesterol) is another potential revenue source. This is a good opportunity for physicians to use clinically proven, science-based methodologies to help patients lose weight and get healthier. “Too much of the money in the weight-loss sector is going to non-MDs,” says Grant. 5. Clinical laboratory. Adding a

clinical lab allows your practice to offer the convenience of onsite lab testing to patients, and brings in additional revenues for offering the service. “This allows the practice www.physicianspractice.com

to, instead of sending patients off with a lab slip, do testing on site,” says Grant, adding that practices that have three or more physicians, and a greater volume of patients, will benefit most. “They can often bring this niche into their practice for very little money.” LEGAL CONSIDERATIONS

Before you start offering any new service, it’s important to check for possible legal conflicts at the local and national levels.

with the law. An attorney would want to check to make sure their ancillary service arrangement meets the criteria for an exception, says Jana Kolarik Anderson, a Washington, D.C.-based attorney with Nelson Mullins Riley & Scarborough. Penalties for violating Stark are stiff, starting with claim denials for all claims submitted pursuant to an arrangement that does not meet an exception. There might also be penalties of up to $15,000 for each service, plus double the reimbursement

“It does not cost a lot of money to [check with an attorney] to ensure what you are planning is appropriate. You want to ensure compliance on the front end, so you are not paying penalties on the back end.” Preemptive Plan

Jana Kolarik Anderson, attorney

The most important law to consider is the physician selfreferral law, commonly known as Stark Law, which governs certain referrals for services from one entity to another, if both entities are owned by the same physician (or an immediate family member) and the practices accept Medicare or Medicaid. There are 12 designated health services specified in the law, including clinical lab services, parenteral and enteral nutrients, radiology and imaging services, and some exceptions as well, such as those for in-office ancillary services. So, for example, “if a radiologist wants to add services such as CAT scans and they own a separate entity, they could run into violation of Stark Law if they referred patients from their practice to get an MRI or advanced CT services,” says Trisha Lotzer, a partner with Phoenix-based Lotzer Law Group and CEO of Physis, Inc. The good news is that there are a number of exceptions that a practice could meet to be compliant www.physicianspractice.com

claimed. You can even be excluded from Medicare and Medicaid. If Stark weren’t enough to worry about, physicians must also take into account the federal Anti-Kickback Statute, a criminal statute that prohibits physicians from offering something of value to referrers or to patients in order to get a referral for a service covered by Medicare or Medicaid. “The Anti-Kickback Statute comes into play when physicians are contracting with an outside ancillary services provider like a [durable medical equipment] or orthotics company or outside lab,” says Anderson. Practices that want to offer services inside their practice by an outside vendor should seek legal counsel, she said. “Structuring arrangements so you are compliant with Medicare enrollment standards as well as the Stark Law, state mini-Stark laws, and state and federal anti-kickback laws should be the focus when you bring any ancillary service into your practice,” says Anderson. “It does not cost a lot of money to [check with an attorney] to ensure what you are planning is ap-

propriate. You want to ensure compliance on the front end, so you are not paying penalties on the back end.” LAUNCH TIPS

Are you ready to launch your new service? Follow these suggestions for getting off the ground and keeping up with your venture: • Find a mentor. Look for someone who has a track record of success. “When I see physicians, I encourage them to go to networking conferences,” says Mike WooMing, a family physician who now spends most of his time helping other doctors build and market their practices, including adding ancillaries. “If you are starting an age-management clinic, talk to doctors starting successful agemanagement clinics. If you can, try to work for those clinics. Do some volunteer work.” • Look at market demographics. Your actual patient demographics — age, income range, education level, and inclinations — should all be factors in your choice of ancillaries, says Grant. This way you avoid buying technology for a service patients can’t afford or don’t need. • Hammer out financial parameters. Unless you’re a solo physician, you need to be clear about who gets what, revenue-wise. “You have to make sure you have discussed that with your CEO of your medical practice,” says Woo-Ming. “Are you representing yourself or are you representing your practice?” • Integrate the new niche. After making an investment in new technology that will be the catalyst for a new revenue-generating service, it’s time to start marketing the new service and using the new equipment. “A lot of practices will get a hair-removal laser and it will sit in the corner gathering spider webs,” says Grant. “You need to educate patients about new services.” n Marisa Torrieri is an associate editor

at Physicians Practice. She can be reached at marisa.torrieri@ubm.com. April 2013 | Physicians Practice |

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