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Healthcare & The Value Of Memory

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services

Back in 1966, Brian Wilson of the Beach Boys decided that he no longer wanted to tour with the band, instead wanting to concentrate on composition. The band needed someone to fill in on bass and the ridiculously high harmonies usually supplied by Brian for an upcoming tour of Japan. They found a man who was born in Arkansas to fulfill the task, but he only lasted on that one tour. This same man went on to record with a studio band named Sagittarius, before littering the pop and country charts for many years afterward with assorted hits under his own name: Glen Campbell.

Tomorrow night in Milwaukee, I am going to see Glen Campbell perform in concert, but the occasion will more than likely be bittersweet. The man who has given his music to the world for a majority of my lifetime is on his final tour, having recently been diagnosed as being in the early stages of Alzheimer’s Disease. It is not lost on me that all of the facts in the above paragraph, which my lifetime of music as a hobby has allowed me to commit to memory, will someday be foreign to the very person who made them possible.

As someone who has been involved with the health care industry for over 20 years, I have learned that based on the sheer volume of facts that inundate me on a daily basis, it has become nearly impossible for me to forget key elements of my job. As the cost of health care has become a central focus for cuts in a post-war economy, a number of  memories of failed policies of the past are skipping to the front of my mental line. Nowhere is this memory more acute that in the realm of physician reimbursement from the Medicare program.

Forty-one days from now, a song-and-dance act that has been running longer than Cats will repeat itself, as the increasingly polarized sides of our government once again raise the curtain on this year’s performance of Doc Fix. There are slight casting changes with every performance, but the script is the same. In the torch-lit Temple of SGR, an automated computer program threatens to take money away from the white-coated sailors on the HMS Doctor. As the sailors fight off armies of infirmed elderly waving checkbooks from behind the wheels of their Buicks, an unlikely set of heroes, wearing bad suits and American Flag lapel pins, short circuit the program with a stack of paper. As they stand in the setting sun, they promise to one day rid the world of the computer, but vow to be ready for anything else it plans to offer.

Oklahoma it ain’t……

Medicare reimbursement has gone from “pay everything” at the beginning of the program in 1966, to RBRVS and Gramm-Rudman-Hollings reductions in the ’80’s, subsequently to SGR in the late ’90’s, and finally to a yearly hostage crisis, with the only missing element seemingly being the security camera shot of Patty Hearst with a machine gun. We know this because it has affected us all in one form or another over the years and we have internalized the memories of the negative results of every one of these “solutions”.

Might I suggest that the solution doesn’t lie with finding a new payment methodology, but in finding savings from outside contractors for the Medicare program that (because I have it committed to memory) continuously take money needlessly from the program.

You can start by eliminating Medicare Part C. Virtually all of the “preventive benefits” offered to patients under these plans are now codified into traditional Medicare, which leaves Medicare Part C as nothing more than a government subsidy designed to prop up the insurance industry with billions of dollars that it doesn’t require for its survival.

Next we can go to Average Wholesale Price for reimbursement under Medicare Part D, rather than Average Sale Price. Additionally, pick one formulary and take the program out of many of the same hands that currently pollute Medicare Part C.

As for fraud investigations, leave in place predictive modeling and the HEAT teams, because these methods are actually getting to the root of the problem and are returning ill-gotten dollars to the Medicare program. When it comes to outside entities, we need not develop memories of the Recovery Audit  Contractors, because their abhorrent work product is currently on display for all the world to see. Roughly 2/3rds of everything they do is dedicated to purposeless paper shuffling, rather than the detection of actual improper payments. One marvels at the thought of the massive celebrations that would result if the RACs suddenly disappeared. Farther up the chain, the ZPICs on average collect about 2% of everything they extrapolate as an overpayment, but we don’t really know the actual number because the OIG has stated that the baseline data to measure their performance is fatally flawed. This reminds me that until that data is purified, the ZPICs will continue to mainly operate as a middle man for government-sponsored subsidies to the legal industry. Ask your typical taxpayer if that is something they wish to continue.

The development of the human memory keeps one from being fascinated by the latest shiny pocket watch issue being pendulated in our faces by the self-absorbed politician of the moment. Much like Glen Campbell, there may come a day that the many facts parading in our minds will begin to slip away. Until that day comes, in the realm of health care, memories are not just a rudimentary tool of assistance, but a blunt weapon against the many forces attempting to shove unwelcome schemes into an arena currently collapsing from the bad ideas of the past.

Paul Spencer will be a presenter at the Fi-Med RAC Summit in Milwaukee, WI on April 16th and 17th, 2012. Go to the Summit website for further information on this unique educational opportunity. Use promo code “SPENCER” to receive $50 off the registration price for a limited time.

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January 20th, 2012 | 1 Comment »

Medicaid RAC Final Rule Released

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services

This coming Monday, I shall be presenting a session on government audit entities at a symposium hosted by the Wisconsin Medical Society. My presentation has been finalized and is already being made available to attendees at the conference. With these facts in tow, it is not at all surprising that this would be a week for major announcements regarding recovery audit programs.

In addition to the release of the modified statement of work for the Medicare Recovery Audit program, we now have the release of the final rule for the Medicaid RAC program. At 140 pages, believe it or not, this is one of the more compact final rules I’ve come across in recent years, so let’s dive right in and take a look.

The first bit of information that I can relate is the new implementation date, which is January 1, 2012, just in time for an election year and another meaningless BCS bowl game. To refresh everyone’s memory, the original implementation was scheduled for April 1, 2011, but was delayed due to the ill-preparedness of several states to move their programs forward at that time.

Many of the features that have been folded into the Medicare RAC program have been included into its Medicaid counterpart. Let’s start with something simple. The Medicaid RAC contractors must hire at least one Medical Director who is “a Doctor of Medicine or Doctor of Osteopathy”. It should be noted that based on the anecdotal appeal rates of the Medicare RAC program, this fact alone should not give anyone a false sense of the accuracy of RAC audits.

Medicaid RACs are required to hire certified coders to conduct reviews, but with a catch. If the state determines that certified coders are not required for the effective review of Medicaid claims, the state can escape this mandate. Since the RACs are independent contractors, and the most reputable firms employ certified coders to conduct audits, I find this language intriguing. With the knowledge that less than 20 states have actually chosen a Medicaid RAC, coupled with the fact that less-enlightened states like to use the state contracting process to pay back political favors, the remaining contracts and who gets them should be extremely interesting given that the use of certified coders can be waived at state discretion.

Some other familiar parallels from the Medicare RAC program now codified into Medicaid RAC include a 3-year maximum look-back period for claims, notifying providers within 60 days of receipt of documentation of any overpayment, acceptance of medical records in electronic format, a toll-free customer service number and state-established limits on the number and frequency of medical records requested from a RAC contractor. Provider education and outreach programs also need to be developed. If this has been a required element of the Medicare RAC program, I’m at a loss to show any relevant examples of it being implemented effectively up to this point.

 The final rule also duplicated what may have been the most amorphous portion of the proposed rule. States are required to coordinate Medicaid RAC recovery efforts with other audit entities, most prevalently the Medicaid Integrity Contractors and the OIG. Because there is no centralized database of Medicaid claims, how such coordination occurs remains a mystery even to the state Medicaid agencies themselves. The only saving grace is that if a state contracts with more than one RAC contractor, those contractors are required to coordinate their activities with one another under the final rule.

Because Medicaid parameters are set by the individual states, the balance of outstanding issues will fall to the veracity of the states in setting up their RAC activities. One rather salient example of this is the fact that unlike the Medicare RACs, there will not be one overarching “New Issue Review Board” to approve new issues by the RACs. States are encouraged to form review teams to approve new issues prior to review, but this is not a mandatory guideline. As this process plays out, it will be interesting to see which states create approved issues lists similar to the regional Medicare RACs.

In addition, the Final Rule is very clear in stating that there will not be one national Statement of Work as is part of the Medicare RAC program. Because not all state Medicaid programs are identical, it is being left up to the states to construct the parameters of their Medicaid RAC program. Medicare is encouraging states to use elements found in the Medicare RAC program, but again this is not required past the point of educating providers about audit policies and protocols.

With regard to contingency fees paid to RACs, CMS has placed in the final rule that the amount of the contingency fee should be tied to the current Medicare maximum or 12.5%. Any state with a contingency fee higher than the Medicare maximum will be required to pay that portion on their own, without help from federal funding. One related battle that should be interesting to watch is CMS’ reluctance to require states to make the contingency fees being paid to contractors by individual states public, in the way that Medicare contingency fees are currently. States are encouraged to make it public, but it isn’t mandatory.

Finally, the appeals process is exactly as I originally envisioned it. We will indeed be facing 50 different appeals processes based on what the states already have in place. If you are not familiar with your state’s Medicaid appeals process, I highly recommend that you do so now in advance of January’s implementation. As a disturbing and threatening footnote, states are not being required to make the success rates of provider appeals public.

On the surface, the Medicaid RAC Final Rule creates 50 separate messes adding up to one monumental garbage dump of a program. If you happen to be a medical provider that routinely submits claims to more than one Medicaid entity, your administrative functions are about to be severely challenged. With the new-found zeal to cut government waste after a multi-decade drunken spending spree, I can only promise that this isn’t going to be pretty.

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September 16th, 2011 | 4 Comments »

New Brunswick Is Not A Shiny Bowling Ball

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services

At this time last Friday, I was driving on the Massachusetts Turnpike, coming home from a whirlwind car trip to St. John’s, Newfoundland. With regard to our country’s financial health, and in particular how that affects our health care system, I picked an interesting week to drive a total of 5,108 miles from Milwaukee to the eastern edge of the continent and back in just under eight days.

I was taking notes in my car as I observed things about Canada that differed dramatically from life in the sunsetting empire to the south. In honor of that, I’d like to alternate some of these observations with updates from the world of the American health care system.

In Ontario, if you are clocked going 50 kilometers (30 miles) over the posted speed limit, you receive a $10,000 fine, your license is immediately suspended and your car is seized on the roadside. It will surprise many who know me that I returned from Canada with the same car in which I entered the country.

The ”deal” that was struck last week to raise the nation’s debt ceiling, while not addressing health care spending directly, still poses a threat to the Affordable Care Act. Currently, the lines are being drawn on each side for a “Super Congress”, consisting of 6 members from each party hand-selected by party leadership. Thus far, the only programs that are seriously being considered for cuts are Medicare and Medicaid. At best, this could be seen as a severe exercise in denial, given our involvement in two wars. At worst, this is a way to defund PPACA by rendering Medicaid unable to accept the 50 million-plus population of uninsured that will suddenly qualify for this coverage in 2014. Given that the Simpson-Bowles Deficit Reduction Commission had similar goals for Medicare and Medicaid earlier this year but couldn’t even agree on a final report, and given the ideologues that have been appointed to the Super Congress, I have no hope of a forthcoming useful solution to the country’s financial morass.

Radar detectors and honey bee importation are illegal in Nova Scotia. If you’re a honey bee that’s considering speeding in Halifax, prepare to have the book thrown at you.

Hoboken University Hospital in New Jersey recently filed for bankruptcy due to $50 million in debts it could not repay. Somewhere among all the unpaid invoices, the hospital happened to find $600,000 in total compensation as a golden parachute for a former CEO. This and other compensation arrangements are beginning to come under the microscope. The average salary for CEOs of non-profit hospitals in the Midwest is $481,000. The old argument of “we MUST offer high compensation to attract the best talent” unravels when this salary mark is juxtaposed against the trend of non-profits converting to for-profit systems for financial reasons. Throw in money to an ex-CEO whose “talent” led to $50 million is non-payable debts, and it quickly becomes outrageous.

Gasoline is over $5 per gallon in Canada, but due to the roads being in such tremendous condition (except for Montreal, that has roads and infrastructure resembling a war zone), my car got incredible gas mileage North of the Border.

The estate of a patient who passed away two years ago after a lengthy battle with progressive demyelinating neuropathy is being sued by Tampa General Hospital for the cost of care. Hopefully, the late patient at the very least lived in a house made of aluminum cans that can be turned in for recycling cash, because the final bill totals $9.2 million. More than any other story that I have ever come across, this one illustrates what kind of health care system we really have. A majority of the care this patient received was palliative in nature and only minimally decreased the progression of the disease. If a disease has no known cure, what is the best way for a patient to be treated? Additionally, who should pay for it? All the ACO models and expanded insurance pools created in the last two years do not offer a solution to these fundamental questions.

And finally…

There are no bumper stickers on the cars in Canada. When I pointed this out to my wife’s cousins at the end of the Canadian half of my journey, one of them stated “we really have nothing to say”. I disagreed. The reason that Canada has no bumper stickers is that they have no need for self-inflating jingoism. To put a bumper sticker on your car is to deliberately and needlessly pick a fight, either politically, by pointing out how wonderful a student your kid is compared to the car behind you or by telling the car following you that they are driving too close. None of these chest-thumping actions do anything to improve understanding or improve the society as a whole. Canadians argue, but they have the intellectual ability to do it with more than a throwaway phrase. In the end, they make decisions based on what is best for the society as a whole. Most importantly, Canadians NEVER stop rooting for each and every citizen to succeed at their chosen endeavor.

It’s not all hockey and doughnuts. We could learn a few things from Canada.

August 12th, 2011 | No Comments »

Updates: Red Flags Rules & the Medicare Physician Fee Schedule

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services, Medicare Fee Schedule

In the coming season of giving, where the profound significance of ancient events in Middle Eastern deserts is reduced to commercial exchanges of clothing and electronic equipment between family members, most of our heads are plunged deeply into personal schedules related to parties, dinners and assorted drinking engagements.

Beyond this frivolity lies the cold hand of reality for those of us involved in health care, namely the year-end litany of oncoming regulations and news updates.

With 2010’s relentless focus on the Patient Protection and Affordable Care Act, a few less notable regulations have tended to fall out of focus. One of the biggest of these is the five-times-delayed Red Flags Rules from the Federal Trade Commission.

To refresh everyone’s memory, the Red Flags Rules instruct anyone who is defined as a “creditor”, to establish internal identification processes, or “red flags” (get it?) for preventing identity theft. The FTC has insisted from the time of introduction of the rules that physicians fall under the definition of “creditor”, as they are rarely paid in full at the time of service.  

On May 21, 2010, the AMA, along with the American Osteopathic Association and the Medical Society of the District of Columbia, filed suit in federal court in an attempt to stop the FTC from applying the rules to physicians. Their central argument was that the FTC, in defining physicians as creditors, exceeded its regulatory authority. The filing of this suit followed an earlier case involving the American Bar Association (ABA), which sued the FTC using the same reasoning, and eventually won. This ruling is currently being  appealed by the FTC. On June 25, the FTC and the stated plaintiffs in the May filing agreed to a delay of rules implementation for physicians until 90 days after the decision in the ABA case. A look at the calendar of the D.C. Court of Appeals for the remainder of 2010 shows that oral arguments in the appeal of the ABA case are not currently scheduled.

On August 17, the Council of Medical Specialty Societies filed a motion to intervene as plaintiffs in the AMA suit, stating that only a small portion of the physician community is represented by the originating parties filing suit. A decision on this motion has yet to be released.

The result of the above pending litigation currently adds up, once again for the physician community, to “delay”. With the latest FTC-stated deadline for enforcement of the Red Flags Rules being December 31, 2010, odds are that the question of physicians being covered under these rules is a long way off. However, while not currently mandated, I would find it to be a good idea for physicians’ offices to develop policies to ensure that the patients they are treating are indeed who they portend to be upon presentation for services.

In other, more immediate news, the U. S. Senate passed a one-month extension of the current Medicare physican fee schedule this week. If the House passes this pending legislation prior to December 1st, a scheduled 23% reduction in the fee schedule will be delayed until January 1st, which will then combine with a previously legislated 6.1% reduction to form the Mecha-Godzilla of all physician cuts.

Enjoy time with family (even that weird uncle), the good food and (if you’re a Dallas Cowboys fan) the bad football this Thanksgiving.

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November 24th, 2010 | 1 Comment »

Surviving The Times

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services

Being an obsessed fan of music as I am, I’ve realized over a period of time that it’s difficult not to develop something of a fascination with self-inflicted casualties and the personalities behind them.

I’ll give you an extreme close-up of a salient example relating to my own life. In 2004, due to a number of life circumstances that I won’t get into here, I made the decision to change my birth name. I began thinking of musicians that I admire, and I revisited the story of Alexander “Skip” Spence.

Skip Spence was the first drummer for the Jefferson Airplane back in 1966 (the year of my birth). He was something of an itinerant and kept his own mental schedule, which was incompatible with the rest of the band, and he was fired prior to their greatest success as a band. He later took his guitar-playing and songwriting skills to the band Moby Grape, another San Francisco band of the era. Through a series of record label miscalculations and ludicrous promotional planning, Moby Grape became the gold standard for how not to succeed in the music business, but Skip Spence wrote, and the band performed, the song Omaha, which is a musical touchstone of the era.

Skip was also a victim of the attitudes and excesses of his time. During the sessions for Moby Grape’s second album, Skip descended into madness fueled by excessive intake of LSD, to the point where he showed up at the studio one day in 1968 looking for the band’s drummer while carrying a fire axe. He spent the remainder of his life battling advanced mental illness until his death in 1999 at the age of 52. To mercifully abbreviate this long story, inspired by the unique music he left behind, I am now known to the world as John Paul Spencer. I added the final “r” so as to not appear as too pretentious to the world around me.

While the history of recorded music has its share of self-abuse stories similar in outcome to what you’ve just read, not all self-inflicted casualties of their times occur consciously. The many companies and corporations who have come and gone since the Industrial Revolution disappeared because they could not adapt to changes in products, demand or business conditions.

Today our medical delivery system finds itself at just such a crossroads. Over the next four years, business principles such as comparison shopping, outcome measurements and diversification are going to be applied to medical practices and hospitals in ways not previously seen.

Take a moment to internalize just how much of a philosophical shift this represents to a physician in private practice. At its core, we are now instructing a person who spent 10 years of his or her life (at great monetary expense) in rigid study and training towards their life’s occupational goal, to learn flexibility. Medical delivery by its very nature is tightly controlled, not typically lending itself to improvisation or random chance. Most established medical problems have been researched, measured and treated to such a degree that treatment protocols zero in on the problem faster now than at any time in human evolution. As the gatekeepers of this collective knowledge, physicians are trained to eliminate all questions, diagnose and treat.

Many smaller medical practices now find themselves in a time of soul-searching. Due to the technical demands brought about by healthcare legislation over the past two years, a perception is beginning to take hold that the independent physician cannot survive and will either have to merge with another larger practice or seek a health system affiliation. Add to this the increased anxiety over the expansion of fraud and abuse investigations by Medicare and other large payers, and the medical marketplace suddenly becomes threatened with shrinkage not from consolidation, but rather attrition similar to the long-lost corporate brand names of the past.

Beings and entities survive based on the ability to adapt and successfully navigate the harsh nature of their surroundings. The human advantage in this equation is the gift of critical thinking and analysis, leading to judgment. Each provider of medical services has within them a unique area of expertise, focus and patient approach that differs from their colleagues in the marketplace. Rather than being a self-inflicted casualty of the changing times, it now becomes the responsibility of each physician to let the world know what it is about them that makes them stand out among their medical brethren. I believe that the identification and greater application of this proficiency holds the key to surviving the changing landscape of healthcare delivery over the next decade.

August 13th, 2010 | No Comments »

The Dangers of Digital Immortality

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services

One of the more interesting stories that came out over the past week involves Affinity Health Plan, a managed care plan in New York. On April 21st, Affinity began to notify over 409,000 people that their personal data may have been released. The list of people contacted included current and former customers, employees, providers and applicants for jobs and coverage through Affinity.

Affinity had leased a digital copier from a company in New Jersey. The copier was equipped with a hard drive that saved every piece of data that went through the copier. When the leased copier was returned to its owner, the hard drive was not erased, leading to a security breach.

In thinking about the world we live in in 2010, there are very few places we can go that offer safe haven from the digital age. What many people fail to realize is that every bit of data ever transmitted in a digital format either already has been or at the very least offers the opportunity to be saved and stored forever.

I must admit that the very idea of this can be frightening. Every text message from my phone, every night spent playing computer games and every profanity-laced tirade in e-mail form that has ever been emitted from my fingertips can be accessed by someone somewhere. I guess we can scratch off a career in politics from my to-do list.

Now let’s bring this ominous fact of life into the realm of medical billing and compliance. It’s safe to say that in every office involved with protected health information, there exists the possibility of the information becoming vulnerable.

The Affinity case is a good starting-off point. The thing that really jumped out at me in this story was the idea that an unsuccessful job applicant of Affinity being contacted perhaps years later and being told “Remember all of that personal information you gave us before we flatly rejected you? It’s freely available in a warehouse in New Jersey”. When it is determined that an employee isn’t a good fit after the interview process, companies are used to sending out the standard “we’ll keep your resume on file for six months” letter and moving forward, with the company holding all of the cards. Now imagine the embarrassment of having to send out a second letter years later telling the person you never planned on seeing again that you exposed them to identity theft via the office copier.

HIPAA regulations make very clear the responsibilities of digital gatekeepers of patient information. It is best to remember that the computer screen in front of you and the servers to which it is connected are only a small part of machinery utilized on a daily basis that stores PHI for a legitimate business purpose. Take a quick look around you. Did anyone leave papers on the copier? Fax Machine? In a common area while getting a beverage? Take a moment to think about what documents you have placed in a medium offering some type of digital storage.

After that, look around your work area. Ask yourself whether in the eventuality of someone breaking into the office whether your desk is vulnerable to letting PHI fall into the wrong hands.

As a pertinent afterthought, I’ll share this. Spaces such as this included, more people are sharing their thoughts with an ever expanding worldwide audience on a variety of subjects. When someone feels passionate about a topic, it is now easier than ever before to stand on a virtual rooftop and shout extemporaneously to the world at large. It is the world unfiltered, and it’s unlike any form of communication that came before it. It brings into focus not only how many bright and talented people have been falling through the cracks for generations, but it is also demonstrating how many unhinged people once took a typing class.

While life has been simplified to a degree in the digital age when it comes to quick access to information, in the immortal words of Peter Parker’s Uncle Ben, great power also brings with it great responsibility. Take a moment to internalize the idea that hitting the delete button does not translate to the end of life in the digital age. Conversely, itis also a good idea to review what you have typed prior to hitting the Send button. Consider everything you do with anything that can be plugged in and has the ability to store data to be permanent and retrievable once it has left you. The biggest thing this story has taught me is that it should be a long time before anyone sits on a copier with their backside exposed again.

April 30th, 2010 | 1 Comment »

10-Day Payment Freeze Coming: The Senate Strikes Again

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services, Hot Topics

The latest temporary fix to the Medicare Physician Fee Schedule, which expires on March 31st,  was not renewed prior to the U. S. Senate adjourning for its Spring recess this past Friday. The Senate will now be in recess until April 12th.

In response to this, in similar fashion to a month ago, CMS has declared a 10-business-day freeze on the processing of claims with dates of service of April 1st and after. Because this freeze is measured in business days, it will end on Wednesday, April 14th, which gives the Senate two days to pass a fix.

The latest physician fee schedule fix is attached to a bill that would among other things, extend unemployment benefits. This latest hold was initiated by Sen. Tom Coburn of Oklahoma, who objected based on there not being equal cuts in spending. The ironic twist is that Senator Coburn was a practicing OB/GYN for 11 years prior to beginning his political career. His hold on the bill would appear to complete his journey away from the science of medicine.

As the great songwriter Steve Goodman once wrote, “It’s not hard to get along with somebody else’s troubles”.

March 29th, 2010 | No Comments »

Translating The Health Care Overhaul

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services, Hot Topics, Industry Updates, J. Paul Spencer, CPC CPC-H

One of my best friends in Milwaukee is my friend Ben. I’ve known him for a few years, and as soon as we met through mutual friends, it took us about 5 minutes to hit it off. Our friendship is designed mostly around three common themes; politics, ice hockey and beer. For purposes of this post, I’d like to focus on the first of these, more than likely to the great relief of my benefactors here at Fi-Med.

Ben and I have been following the progress of the health care legislation that became the law of the land this past week with great gusto, being the above-average policy wonks that we consider ourselves to be. It’s been an interesting  journey, and as we have discussed this topic in public in different venues around Milwaukee, we’ve tended to suck in random eavesdroppers who are surprised mostly that people are engaged in the process without the tirades and invective so common in the modern world of 24-hour cable news.

Over the past two weeks, random employees of Fi-Med have also informally polled me for my opinions and analysis of the health care reform legislation. Weighing in at 2,409 pages, breaking it down can be daunting. Having said that, I’ll try to focus on the biggest issues that are front and center in the Patient Protection and Affordable Health Care Act.

Covering The Uninsured – The main reason why health care reform was seen as a top priority was the number of uninsured people in the United States. Currently, 83% of Americans have health insurance coverage. After the full phase-in of the new law, that percentage is expected to grow to 95%. There are a few ways the law expands coverage. Medicaid programs will be expanded to cover people with incomes up to 133% of the federal poverty level (currently $29,327 a year for a family of four). If you own a small business (generally defined as less than 50 employees), are self-employed or currently uninsured, the law mandates the creation (or expansion) of state based insurance exchanges, which are basically purchasing pools designed to give smaller groups the same kind of purchasing power as a large employer or other well-heeled insurance customers. There will also be national exchanges available that will be overseen by the same agency that currently oversees the health plans available to members of Congress. Beginning in 2014, if you are not covered by a health care plan, you face a penalty, unless your income falls below a certain level. Additionally, in 2014, if you are employed by a company with more than 50 people, and the government subsidizes coverage for your company, the company faces a penalty of $2000 for each full-time employee, with 2 part-time employees counting as 1 full-time employee for purposes of calculation. Pro - People who do not have coverage will be able to find affordable coverage from multiple sources. Con - On the surface, this would seem to strengthen the hand of an already entrenched insurance industry in the absense of a national public option or the option to buy into the Medicare program while weakening the options of the mid-sized employer.

Pre-Existing Conditions – Beginning in 2014, insurances will no longer be able to use pre-existing conditions (for adults or children) or a person’s gender to deny a person coverage or increase premiums. Since this is four years away, the law also creates a temporary national high-risk pool similar to programs currently available in 35 states. There are only pros in this portion of the law. When healthcare reform was first attempted in 1993, the idea of the elimination of pre-existing conditions was brought forth against the backdrop of over a decade dealing with the AIDS crisis and the challenges it brought to chronically ill patients attempting to obtain coverage. What we ended up with was HIPAA, which was an important first step with regard to patient privacy and protection of medical records, but somewhat far afield from the initial goal. I would imagine that insurance applications are going to look radically different four years from now barring any sudden changes to the law.

Insurance Basics – Some long-held standards in the basics of insurance coverage change with the new law. Parents will be able to keep children insured on their policies until age 26. Beginning in 2014, childless adults below the federal poverty level will be eligible for Medicaid coverage. Pro - College graduates can continue coverage under their parents’ plan in a challenging job market. Con - Really? Your children don’t have a plan by age 26? Sell their X-Box when they’re not looking and put their possessions at the curb. Explore tough love.

Senior Citizens - By 2020, the so-called “doughnut hole” in Medicare Part D coverage which doesn’t cover up to $1,720 of prescription drug costs, will be substantially addressed. This will begin modestly this year with a $250 rebate to seniors facing the out-of-pocket expense incurred after the first $2,830 of benefits have been exhausted. Beginning in 2011, seniors will begin to receive a 50% discount on brand-name drugs, which will slowly increase to 75% by 2020. The bill also has a cap on annual increases in Medicare spending, which will be closer to 2%. This is down from the 4% increases seen in the past. Pro – The onerous gap in prescription drug benefits for seniors is belatedly addressed. Con – A back-door gift to the larger players in the pharmaceutical industry, as generic drugs are not subject to the same discounting procedures. Decreases in Medicare spending more than likely will be felt in the elderly wallet. This could theoretically turn into a pro for drivers like me, as the elderly will have less money for fuel to drive their Buicks in the left lane at 35 miles per hour on the expressway as I’m trying to pass.

Dollars and Cents - The plan has an estimated cost of an average of $94 billion dollars over the next ten years. While the total seems high at first blush, comparing it with the costs of the ongoing military operations in Iraq and Afghanistan (remember those?) suddenly makes that number seem small. A tax on investment income of 3.8%, as well as increased taxes on individuals making more than $200,000 per year and married couples making over $250,000, pays for some, but not all of the bill. Pro – When held up to the projected costs of a full government takeover of healthcare with a public option, this appears not to be a lot of money. Con – When a citizen overdraws his personal checkbook, we get a nasty letter and a fine from our bank. When an American legislator of either party overdraws the country’s checkbook, they congratulate themselves, get checks from their corporate benefactors and get re-elected. This is one of the big reasons why I’m in the slender minority of people who want to see global warming actually succeed, so we can usher in a Humankind 2.0 that in theory will be able to properly operate a calculator.

PQRI – Less talked about in the greater news media is the fact that the new law mandates the use of the Physician Quality Reporting Initiative beginning in 2014. As with the current statute regarding electronic medical records, there will be gradual reductions to a physician’s Medicare payments if quality reporting is absent. This shouldn’t come as a surprise to anyone in this industry, as this has been an eventual goal of the program from the very beginning.

Physician Payments -The current state of the physician fee schedule was not addressed with the new law. This is still tied to another piece of legislation that extends unemployment benefits and rural satellite TV. Senator Tom Coburn of Oklahoma has objected to the bill in the same fashion as the objection by outgoing Senator Bunning of Kentucky to the last extension. The Senate adjourns on March 31st for a two-week recess, leaving 5 days for the temporary fix to the Medicare Fee Schedule to remain in place before reverting to the 21.3% cut mandated by current law.

As many of the provisions of the new law do not take effect for a few years,  the results will not be immediate. As the law stands, it should be viewed as a beginning, as both sides of the political fence fight to either expand or contract the law in its current form. I know that my friend Ben and I are optimistic. Now if only we were so optimistic about our respective teams’ chances in the Stanley Cup Playoffs that start in a few weeks….

March 26th, 2010 | 3 Comments »

Better News For The Physician Fee Schedule

Posted by J. Paul Spencer, CPC, CPC-H in Fi-Med Services, In the Press, Industry Updates, J. Paul Spencer, CPC CPC-H

It’s been an interesting few weeks with regard to the Medicare Physician Fee schedule.

In my post on February 26th, I detailed the last-minute objections by lame-duck Kentucky Senator Jim Bunning to the passage of the bill which contained a 30-day hold on the 21.3% decrease in the physician fee schedule. Due to Bunning’s hold, CMS was left no alternative but to instruct carriers to hold all claims with dates of service March 1st and beyond for 10 business days in the hopes that the bill would be passed in the Senate. On March 2nd, after several hours on the Senate floor shaking his fists and yelling at clouds as only an elderly man can for the viewing pleasure of the C-SPAN audience, Bunning relented, the bill passed, President Obama signed the legislation into law and the claims hold was lifted almost immediately.

Due to the new deadline of April 1st, the issue was taken up again this week by Congress. The Senate actually acted first this past Wednesday, passing a bill that would extend the hold on the fee schedule decrease until October 1st. This legislation now returns to the House of Representatives for consideration next week.

What is still needed, and apparently not being talked about on the legislative side, is a permanent fix to the sustainable growth rate formula. The October 1st deadline now represents the 4th moving of the goalposts in a period of 3 months. While no one wants to see the 21% cut, the chorus from those wanting a permanent fix continues to grow louder.

With better news, we now enter a world more plagued by uncertainty than even the payment fix, this being the continuing saga of the broad healthcare legislation currently coursing its way through Congress at the rate of a sloth in an opium den.

From what I can gather from news reports, it would appear that a final vote on healthcare legislation is going to occur by the end of the month. President Obama has delayed a planned trip to Guam, Australia and Indonesia that was scheduled to take place from March 18-24 by three days in order to concentrate on getting healthcare legislation passed and enacted into law. So many variables remain on the table as the bill enters final negotiations that it would be premature of me to predict the shape of the final legislation. Judging by what I’m hearing, my optimism isn’t high.

As is often the case in Washington, the inflated sense of self-importance so prevalent in American politics tends to rear its head in the most ugly fashion possible when one side perceives that they aren’t getting everything they want right this minute. The cacophony of nonsense that has poisoned the well of civilized political discourse for the last 20+ years insures two outcomes, the first being ever expanding concentric circles of bad legislative decisions and the second being a chronic loss of interest in the issues that count from the rational people who most need to be part of the debate.

Rather than ending on a pessimistic note, I’ll end with a happier tone. St. Patrick’s Day is now five days away. I’ll be “out of the office” on Wednesday, March 17th. If you happen to be out in the great beyond of Milwaukee this coming Wednesday and you come across someone with brown hair wearing a Guinness hockey jersey, do the right thing and prop me up.

Until then, have a great weekend!

March 12th, 2010 | No Comments »

Wondering if a lockbox is right for your practice?

Posted by Lisa Velasquez in Fi-Med Services, Hot Topics

The AMA published an article a few years ago in American Medical News about the use of bank lockboxes in response to a question about whether or not it was worth the expense. Although the article did a great job of explaining the benefits of using a lockbox to expedite deposits, it did not answer the second part of the question asked, which was, “Are there any alternatives?”

CEO, Adrian Velasquez and COO, Christine Krause have always recognized the benefits to physicians of using a lockbox service and prior to creating Fi-Med’s internal bank and lockbox service, they used to encourage all of their clients to use a lockbox if at all possible. Unfortunately, not all banks provided lockbox services to their customers, and those who did often charged very high fees making the use of a lockbox not a very practical solution for most physicians.

Adrian and Christine consulted with several banks in order to find an affordable solution for their clients. As they began to work with banks they realized that there was a very important component to the lockbox process that all banks were missing. The problem? Banks don’t understand medical billing. They don’t understand what an Explanation of Benefits (EOB) is. They have scanning technology but their employees aren’t trained to recognize and capture all the important information that a medical practice needs. They don’t do this intentionally, they just don’t understand how medical billing works. Adrian and Christine realized that in order to provide the best service to their clients, they were going to need to create it themselves.  

The  Fi-Med lockbox brings the best of both worlds to our clients—the security and efficiency of a  lockbox that is more affordable than most traditional bank lockboxes, combined with years of medical billing experience. Fi-Med’s lockbox is more affordable than most traditional lockboxes. There is no need to change your existing banking relationship, payments are immediately scanned and deposited by ACH into your bank account of choice and you can view daily deposit activity online.

The Fi-Med lockbox service trims more than a week off the normal payment cycle for most clients and  eliminates time spent opening and sorting checks and Explanation of Benefits (EOB), filling out deposit slips and taking deposits to the bank. Fi-Med’s lockbox service takes human error at the office level out of the equation, completely eliminates the potential of employee theft and makes account reconciliation faster and easier. 

Fi-Med staff is bonded and follows GAAP in the separation of duties and responsibilities. Fi-Med is committed to excellence, offering its clients reduced costs so that they can concentrate on maintaining a high level of care for their patients and a competitive advantage.

March 5th, 2010 | No Comments »

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