Roland Therriault, president and executive vice president of sales at InSync Healthcare Solutions, says it’s important for a forward-thinking telehealth vendor to offer the following:

 Telehealth software should provide a seamless experience between patients and providers. The best solutions allow easy appointment scheduling and documentation of care during a patient visit to ease administrative burden. Otherwise, providers are forced to switch between platforms entering and reviewing information instead of concentrating on patient care.

 Solutions that allow information exchange between stakeholders improve care delivery. When care team members can send and receive notes and videos, patients ultimately receive more coordinated, effective care.

 There are many EHR platforms capable of providing or integrating with telehealth providers. However, the important question to ask is: How is telehealth billing handled? The best solutions automate the claims creation process when a visit begins and allow for denial management and batch rebilling.

 Cookie-cutter telehealth solutions that don’t allow for customizations to address specific practice nuances should be marked off any list. Health care is complex, and no two practices are alike. A large provider organization will have access to resources that a small, specialty practice will not. Plus, the needs of a mental health provider are much different from those of a pediatrics practice. Telehealth solutions should be able to address these nuances.

Therriault suggests practices and health systems ask the following questions when choosing a vendor partner:


Can you provide a proven track record of successful implementations?


What implementation and support options do you provide?


How much of your budget is dedicated to ongoing research and development?


Can your solution integrate with my EHR and billing systems?


Does your solution allow providers to document during a session?


Can we customize the solution to fit our practice’s needs?


Is the telehealth solution HIPAA-compliant, and can it protect against emerging security threats?

Articles

Does your telehealth vendor offer the right solutions? And are you asking the right questions?

What to look for in a telehealth vendor

The health care industry has for years been trying to figure out how to get people to buy in to telehealth services. Were users concerned about security? Was it too hard to use? Will older patients be comfortable seeing their doctor online? It turns out that a pandemic was the catalyst no one saw coming.

Telehealth care in the pandemic and beyond

The Centers for Disease Control and Prevention reports that telehealth usage increased 50% in the first quarter of 2020 compared with the first quarter of 2019, with a 154% increase noted by the start of the second quarter of 2020 from the prior year. Changes in the way telehealth visits were reimbursed helped make this change happen and encouraged vendors and health care providers to offer increased support for virtual health platforms.

The problem then became how providers could quickly pivot to provide the services their patients needed without seeing them in person. According to a Kaiser Family Foundation (KFF) report, many providers didn’t have the capacity to offer telehealth at the level the pandemic required at the beginning of 2020. Regulatory changes brought a new influx of cash to health care systems to create or upgrade telehealth systems. The KFF revealed that while 50 of America’s largest health systems already had telemedicine programs in place, only about 15% of physicians in those systems actually used the platform.

The explosion of demand for telehealth services and new financial support for this channel meant that many health care systems had to consider revising or replacing their platforms and offering support and education to providers and patients. Health care systems that didn’t have systems already in place found out quickly that there is a lot more to telehealth than a virtual connection.

When it comes to telehealth platforms, there is no such thing as a one-size-fits-all approach. Each patient and provider has unique needs and there is a wide range of services offered in every health system. Organizations need a flexible vendor partner that can satisfy different preferences among both physicians and patients, says Dan Olson, senior vice president of provider and payer solutions at Amwell, a Boston-based telemedicine company.

“We find that our customers have a wide range of needs and many want an integrative solution,” Olson says. “But they also have providers that really want fast, easy, and simple.”

Early in the pandemic, some health care providers resorted to private systems like Zoom or FaceTime to see patients if their systems weren’t ready to meet their virtual patient care needs. But these platforms bring up privacy concerns and there is no consistency through the health care system. The focus shouldn’t be just seeing a patient over a video stream but also providing them with a safe and secure space that will allow providers to integrate care with their electronic medical record (EMR). It’s not enough just to put a screen between patients and providers.

“Everyone ran out with COVID and tried to do video visits. The market is kind of paused now as vendors look at enabling virtual health throughout the entire care continuum,” says Patrick Rainville, director of business development at Iron Bow Healthcare Solutions, a telehealth firm headquartered in Virginia.

Health care systems should be looking for enterprise platforms that don’t need to be developed from scratch. Software platforms that can be configured for individual workflows at the use level—not coded—are in high demand, Rainville explains.

“A vendor should offer something that can scale from home use and wellness to ambulatory, skilled, acute care and more,” he says.

Telehealth systems have to be agile and easy to use for both providers and patients while also offering a consistent experience. Blending flexibility and consistency can be difficult. A lot of practices launched telehealth solutions quickly to meet the demand presented by the coronavirus 2019 (COVID-19). One problem of hasty solutions was that many lacked integration to a health system’s electronic health record (EHR), he says.

“Usually companies that struggle don’t have an EHR integration,” says Chad Anguilm, vice president of in-practice technology services at the Michigan-based health care consulting firm Medical Advantage.

There also must be an understanding of clinical care and workflow, he says.

“It’s not enough to just offer a telephone number or link. It’s about training and support for everyone involved. Everything from triage to ‘webside manner’ is completely different in telehealth, and you have to be trained properly from the front office to the clinical team,” Anguilm adds.

A vendor must be able evolve with your needs and scale across an enterprise, too. There are a lot of technology solutions that can connect people, but delivering care is a different animal. A vendor partner should have a record of success — and be able to prove it.

“You need a partner that has done its due diligence and vetting,” Olson recommends. Experience matters when it comes to telehealth platforms, he adds.

A good vendor will be able to demonstrate success elsewhere and be willing to create workarounds and flexible solutions where you need them. They should share where their gaps are and what they are planning to be able to move forward. Telehealth isn’t a static platform.

“Ask for two or three references in a similar specialty,” Anguilm says. “If it’s taking a long time to find those references, that should be a red flag.”

Health care systems will also want to make sure their vendor partner is prepared to stay around and help long after a contract is signed.

“Choosing a partner that has done this before or who has a customer base where they have demonstrated success is important,” Olson says. “A lot of people claim they can do things, but they might not be health care specific. It’s important to have that experience in health care because workflows and all the different systems you work with are very different than turning on a web meeting. You need account management and support teams that will walk you through it and build trust.”

The biggest question, says telehealth expert Joseph Brennan of Moonshot Health Consulting, in Grand Rapids, Michigan, is how the system and patients will be supported after the health system signs on.

“When implementing a technology that is in health care, whoever is supporting you —the relationship is critical,” Brennan says. “So I would ask [the vendor], ‘What is your model for support and what do I get with what I’m buying?’”

It’s helpful to have a dedicated project manager or support team from start to finish, Anguilm adds. Sustainability is also key. If waivers and reimbursement change once the pandemic subsides, you shouldn’t need to find a new platform. A good partner will have a full implementation plan laid out, detail how you will reach out to and educate patients, provide reimbursement information and more. Avoid long-term contracts, he adds, because there isn’t much information yet on what reimbursement for telehealth will look like a year from now.

“Simply put, a good vendor partner program should feel like an extension of ongoing operations. Health care organizations looking for a strong partner for telehealth should expect a level of support that maximizes opportunity and minimizes headaches and interruptions to current workflows,” adds Roland Therriault, president and executive vice president of sales at InSync Healthcare Solutions, a Florida-based health care technology company. “Vendor partners should take on the heavy lifting of implementations, technology adoption and optimal use of a telehealth solution. In addition, the best relationships ensure ongoing success by keeping providers apprised of evolving regulatory movements, ensuring infrastructures align with the most advanced security functionality and ongoing support and oversight of end-user education. This way, providers are able to focus on patient care and other mission-critical activities.”

When it comes to telehealth, the big challenge seems to be on the technology end. But solutions that focus on technology alone aren’t enough. Telehealth platforms have to have a deep understanding of health care and the needs of both patients and providers. When searching for a telehealth platform, there are a number of things to watch for, including vendors that overpromise, Olson warns.

“That should raise a red flag, in my opinion,” Olson says. “A vendor saying that it can do anything a customer wants is not practical in the real world.”

Ask vendors for references from providers that use their system already. They should be willing to share success stories, Olson says.

Anguilm adds that it’s also important to look for glitches and delays during demonstrations of the program. If it happens in a demo, it will happen live, he warns. Make sure the company can support the technology it promises. Brennan suggests that part of the vendor partner selection process should include a discussion of failure and connection rates. Do users who sign on stay on for their appointments? Where are people dropping off and what can the vendor do to help address this?

There should be ongoing support and service, too, with teams dedicated to address patient problems and support providers.

“When you’re looking for a partner, look for someone who has been around and has a full-service offering,” says Kevin Greene, director of health care sales at Iron Bow. It’s not enough for a vendor to supply a product. There needs to be operational and clinical support with an understanding of the outcomes you are trying to reach, he adds.

The best vendors offer help-desk services and ongoing support for both clinical and technical support.

“One thing is if you are looking for a vendor, you get commodity offerings. When you look for a partner, you get someone who will invest with you,” Greene says. “You need partners that want to have a shared-risk environment that will put skin in the game, like a per-click share to make sure the program is successful.”

Overall, Brennan says, understand that not every solution works for every system, and that there is a big difference between technology and health care. The key is finding someone who understands your goals and knows what it will take to get you there.

“It’s all the same thing. It’s videoconferencing bolted onto your EMR,” he says. “But if the person you’re talking to doesn’t have any health care references, that’s a big red flag. They’re either brand new and you’re going to be their first customer, or it’s not going that great. Many tech people don’t understand how intricate every aspect of health care is. This isn’t a retail shopping experience; this is health care.”

When it comes to telehealth platforms, there is no such thing as a one-size-fits-all approach. 

Your future telehealth program: Building a plan beyond the pandemic

Getting paid requires accurate documentation and correct code selection. In our coding case studies, we explore the correct coding for a specific condition based on a hypothetical clinical scenario. This particular scenario involves a patient presenting with symptoms of depression. See if you can choose the correct codes.

Patient, 56, presented with continued chronic fatigue and concentration issues. Reports regular physical activity, such as swimming at the YMCA up to one hour at a time, up to four times per week. Patient has had an 8-pound weight gain since last office visit. She notes daily activities such as walking in the park and going to the YMCA. She has modified diet and has consulted with nutrition services for evaluation. Reports adherence with healthy diet provided by dietetic services. Patient is in remission from colon cancer, not currently on medication administration of chemotherapy. She states that weight gain and continued fatigue may be the result of chemotherapy. Patient denies fever, chills, headaches, weakness and light-headedness.

Constitutional: Negative.Negative for activity change, appetite change, and fatigue. Positive for unexpected weight change.

Psychiatric/behavioral: Has had decreased concentration but no dysphoric mood, self-injury, sleep disturbance or suicidal ideas.

Constitutional: She is oriented to person, place and time. She appears well-developed and well-nourished. She is active. No distress.

 Hearing, tympanic membrane, external ear and ear canal normal.

Mouth/throat: Uvula is midline, oropharynx is clear and moist and mucous membranes are normal.

Eyes: Conjunctivae, extraocular muscle and lids are normal. Pupils are equal, round and reactive to light.

Cardiovascular: Normal rate, regular rhythm, S1 normal, S2 normal and normal heart sounds.Exam reveals no gallop.

Pulmonary/chest: Effort normal and breath sounds normal. No respiratory distress. She has no decreased breath sounds. She has no wheezes. She has no rhonchi. She has no rales.

Abdominal: Soft. Bowel sounds are normal. She exhibits no distension. There is no hepatosplenomegaly. There is no tenderness. There is no rigidity, no rebound and no guarding.

Neurological: She is alert and oriented to person, place, and time.

Skin: Skin is warm and dry. She is not diaphoretic.

Psychiatric: She has a normal mood and affect. Her speech is normal and behavior is normal.

Continue regular exercise and healthy diet

When documenting depression, include the following:

Major depressive disorder

Single (in partial or full remission) or recurrent episode 

Mild, moderate or severe episode

With or without psychotic features

Bipolar disorder with current episode depressed (mild or moderate severity)

Mood disorder with or without major depressive-like episode

Adjustment disorder with depressed moodPostpartum depression

F06.31
Mood disorder due to known physiological condition with depressive features

F06.32
Mood disorder due to known physiological condition with major depressive-like episode

F31.30
Bipolar disorder, current episode depressed, mild or moderate severity, unspecified

F31.32
Bipolar disorder, current episode depressed, moderate

F32.0
Major depressive disorder, single episode, mild

F32.1
Major depressive disorder, single episode, moderate

F32.2
Major depressive disorder, single episode, severe without psychotic features

F32.3
Major depressive disorder, single episode, severe with psychotic features

F32.4
Major depressive disorder, single episode, in partial remission

F32.5
Major depressive disorder, single episode, in full remission

F32.89
Other specified depressive episodes

F32.9
Major depressive disorder, single episode, unspecified

F33.0
Major depressive disorder, recurrent, mild

F33.1
Major depressive disorder, recurrent, moderate

F33.3
Major depressive disorder, recurrent, severe with psychotic symptoms

F33.8
Other recurrent depressive disorders

F33.9
Major depressive disorder, recurrent, unspecified

F43.21
Adjustment disorder with depressed mood

Z13.31
Encounter for screening for depression

Z13.32
Encounter for screening for maternal depression

Major depressive disorder, recurrent, moderate

Morbid (severe) obesity due to excess calories

Coding case studies: Depression

When primary care physician Dr. Karen Smith noticed that opioid abuse rates were skyrocketing in her community of Raeford, North Carolina, she decided to do something about it: She partnered with a behavioral health agency to roll out a medication-assisted treatment (MAT) program within the four walls of her practice.

Here’s how it worked: Smith screened patients for opioid abuse during the intake process. When she identified patients who could benefit from MAT, she used a warm handoff to connect them with a psychiatrist who could treat them on-site. This immediate access was a significant benefit for patients in an impoverished community where travel wasn’t easy.

Although Smith could have charged rent for the office space the psychiatrist used, she did not because she was reaping other financial benefits related to her performance in an Accountable Care Organization.

“We were actually seeing improved outcomes and a return on the back end,” she says. “We were controlling the total cost of care for those individuals. The amount we would charge for rent would be nowhere near what we would see in terms of cost control.”

When COVID-19 struck, the MAT program shifted from in-person visits to telehealth. “Patients would have otherwise fallen through the cracks,” Smith says. “With telehealth, we were able to maintain services.”

Nearly one in five U.S. adults lives with a mental illness, and the COVID-19 pandemic has only exacerbated the problem nationwide. More than 85% of primary care physicians report that the mental health of their patients has decreased during the pandemic, according to a recent survey conducted by the Primary Care Collaborative. Thirty-one percent report seeing a rise in patients experiencing addiction.

Integrating behavioral health services into primary care practices is one way to address emerging mental health challenges because it closes the gap between need and access. In October 2019, the American Medical Association (AMA) along with several other leading physician organizations established the Behavioral Health Integration (BHI) Collaborative to help primary care physicians build successful models of integration.

“We’ve been hearing about the challenges of integrating mental health because our primary care colleagues have been talking about this for years,” says Dr. Patrice Harris, practicing psychiatrist and present of the AMA. “That’s where the collaborative comes into focus. We want to continue to provide resources to maximize the potential return on investment. We want to help primary care physicians succeed.”

The collaborative is building an online compendium that includes webinars, remote learning opportunities and other resources (e.g., key steps, best practices and tools) to integrate behavioral health, engage patients and ensure billing and coding compliance.

As Smith’s experience demonstrates, BHI isn’t helpful only during COVID-19. It can also help primary care physicians move the needle on value-based care.

“Studies have shown that untreated depression can complicate the course of diabetes, hypertension, heart disease and post-surgical care,” Harris says. “It’s so important to look at the return on investment in terms of health outcomes.”

As with any new initiative, performing a needs assessment is the first step. Depending on patient needs, there are varying degrees of integration that might be appropriate for a primary care practice.

Sean Weiss, partner and vice president of compliance at DoctorsManagement, says primary care physicians should run a utilization report for the past 30 days, then ask these critical questions:

How many unique patients had a mental health diagnosis, and what were those diagnoses? This requires asking patients to fill out Patient Health Questionnaires such as the PHQ-9, GAD-Z, PHQ-2 or EPDS.

What was the average duration of those encounters?

How often did those patients receive a referral to an external behavioral health provider?

How often did those patients receive a prescription and for which medications?

“Data is king,” Weiss says. “It’s about establishing clinical need.”

This analysis can also help physicians determine the right credentialed provider, he adds. For example, if they frequently write prescriptions, it might make sense to partner with a psychiatrist. If the majority of patients have anxiety or struggle with alcohol abuse, maybe a psychologist or social worker is the best fit.

The good news is that depending on the model chosen, physicians don’t need to completely re-engineer their practices, Harris says.

For example, some primary care physicians may choose to simply consult with an external psychiatrist on a case-by-case basis. This model might work well in practices with a low volume of patients with mental health diagnoses. In other models, a behavioral health specialist works on-site collaborating through varying degrees of co-created care plans and shared systems. The specialist may or may not be employed directly by the practice.

Physicians also need to think about billing implications, says Jackie Coult, CHBC, senior healthcare consultant at Eide Bailly LLP, who recently worked with a primary care practice struggling to cover an employed social worker’s wage because commercial insurance payments for the psychotherapy services she performs are relatively low.

Experts say physicians should consider these questions:

What current procedural terminology (CPT) codes will the behavioral health specialist actually bill? See the sidebar for more information. Keep in mind that state licensure requirements, payer policies and individual areas of expertise will dictate what type of provider can bill for each type of service, Coult says.

What do payers pay for the CPT codes that the specialist will most likely bill? Be sure to differentiate between Medicare, Medicaid and commercial payers (including each individual plan).

These questions can help primary care physicians determine not only whether a direct full- or part-time employment model makes financial sense, but also specifically what type of compensation structure to offer, Weiss says. Some practices use a salary while others use a lower base amount plus volume-driven bonus payments, he adds.

During the public health emergency, the Centers for Medicare & Medicaid Services (CMS) expanded its list of telehealth-covered CPT codes to include various BHI-related services. The good news is that telehealth can help practices lower overhead costs for BHI.

“Telehealth is going to play more and more of a role in the integrated care of patients,” Weiss says. Investing in a compliant telehealth platform can help primary care physicians achieve a return on investment, he adds.

Telehealth-based BHI is something Smith hopes payers will continue to cover even after the end of the public health emergency.

“It enables access and quality care, it’s efficient, and it’s cost-effective. It meets the quadruple aim,” says Smith. “Once you address mental health problems, you’ll see an improvement in the overall health of patients.”

When it comes to BHI, she says independent primary care physicians can lead the charge. “One of the reasons I’ve been so successful is because I’m a solo physician,” Smith says. “I had the freedom to actually pursue this area of interest. When physicians are confined, that interferes with physician well-being and their desire to do what’s best for the patient.”

Integrating behavioral health and primary care

Email archiving is an automated process for preserving and protecting all inbound and outbound email messages (as well as attachments and metadata) so they can be accessed later. In other words, email archiving is storing and making them searchable.

Email archiving providers take this burden off organizations by storing emails on their servers while making them accessible to designated administrators in the organization. This is different than simply creating an email data backup. Data backups do not allow searching, so if a particular email needs to be found, it might take weeks for you to find it.

HIPAA delineates what covered entities need to do to maintain compliance, but it does not provide specific guidelines about how to do it. Email archiving is not explicitly mentioned anywhere in the regulations.

Under the HIPAA Security Rule, healthcare organizations have to retain electronic communications data for a minimum of six years. During this time, access and audit controls must be implemented to protect the confidentiality, integrity, and availability of electronic protected health information (ePHI) to comply with the risk analysis requirements of the Security Rule and prevent improper data modification or deletion. Email archiving is an effective way to accomplish these HIPAA requirements.​

Email archiving solutions generally upload emails to the provider’s servers, where the emails are indexed to allow the archive to be searched. The emails are encrypted which reduces the potential for “man-in-the-middle” attacks where data is intercepted.

Since the archived emails cannot be edited or deleted, they are also tamper-proof. Service providers impose tight controls over who can access archived emails to view patient data, fulfill an audit request made by the Department of Health and Human Services (HHS), or provide email content for legal purposes.

Electronic discovery, better known as eDiscovery, is the process in which electronically stored information (ESI) is requested, searched, located, and produced with the intent of using it in a court case as evidence, for government investigations, or as part of a Freedom of Information Act request.

If your healthcare business must conduct an audit for eDiscovery purposes, the search capabilities of an email archiver make this a vastly easier, faster, and more comprehensive process.

In addition, emails contain metadata (e.g. information about the device used to send a message or the date and time an email was sent) that is a vital part of legal evidence.​

There are many benefits to email archiving for your healthcare business. Here are a few of the main ones.

 Covered entities reduce their server load by allowing an email archiving provider to archive and store their emails.

 Email archiving preserves the intellectual property contained in business email and its attachments. It also eases the burden on an IT department to find lost emails.

 Because the data is stored on a service providers’ servers, email archiving can be part of a healthcare organization›s disaster recovery plan. In the event of a ransomware attack or other catastrophic event that corrupts email data, emails and attachments can be recovered from the archive.

 Archiving emails also helps to prevent insider data theft or destruction by dishonest or disgruntled employees because you always have a backup.

 Retaining searchable emails and attachments from all staff members means that if there is ever litigation, it will be much easier to find and produce the required emails.

 In addition to privacy protection, HIPAA also features strict guidelines on how to dispose of PHI. Email archiving offers automated email retention in one centralized place.

Hoala Greevey is the founder and CEO of PauBox, Inc. Send your questions to
medec@mjhlifesciences.com.

HIPAA compliance: Is email archiving necessary?

Physicians are often faced with noncompete business agreements when signing employment contracts. These may also be required of physicians obtaining hospital privileges. A physician who signs a noncompete agreement, also referred to as a noncompete clause, agrees not to work for a competing practice or hospital within a certain period of time after leaving a job. Breaking the noncompete agreement may incur a hefty fine that is typically spelled out in the physician’s contract.

Often, addressing the fine details of a noncompete clause after the fact adds costly legal fees. There are a few strategies that doctors can adopt before and after signing a contract to avoid problems with noncompete issues.

Some doctors are hesitant about asking for compromises when signing a contract.

For example, young doctors may be worried that a contract could be withdrawn after requesting concessions such as removal of a noncompete clause. Jon Appino, principal and founder of Contract Diagnostics, a firm that helps physicians with contract reviews, says dealing with such hesitation is a skill.

“There are careful ways to approach the conversation. Just like good bedside manner, you can learn how to negotiate,” he says.

Appino explains that a physician can be creative with requests.

“They may not be able to change the noncompete, but that doesn’t mean there aren’t many compromises you can make around it,” he says.

Of course, sometimes a physician absolutely cannot avoid being penalized for breaking a noncompete agreement. Some of these agreements can impose a fine ranging from $10,000 to $250,000. And geographic limitations may range from within 5 miles to 100 miles of the practice.

For doctors who work in large hospital systems with many satellite offices, the noncompete can encompass all of those locations. These agreements can cover a time period from one to three years after leaving a practice.

When the financial implications of taking a new job are too costly, doctors still need to earn an income before the noncompete restrictions expire.

Locum tenens work, often in different states, to provide temporary employment in various geographic regions during this time period.

Telemedicine can be another option. Tisha Rowe, MD, founder of Rowe Network, a multispecialty telemedicine network, has worked with doctors who use telemedicine as a way to bridge the gap before they can start another job in the same town without violating a noncompete agreement.

There are some positive aspects of noncompete agreements. A practice can lose patients after a physician leaves to set up a practice in the same town, and a noncompete agreement can reduce the chances that this could happen.

Some physicians, particularly those who have worked hard to build their group structure, often see benefits to these arrangements.

“A physician who is happy with their role could see that a noncompete agreement would protect the group and their colleagues from leaving and causing harm to the group,” Appino says.

Newly trained physicians may want some time to decide if they want to stay in a city or town long term. Often, taking an employed position for a few years before starting a practice is the most practical way to do that. And even for those who know they want to start a private practice, most doctors need to work and save up money before they can afford to open their own practice.

With a noncompete agreement, employers have less incentive to be fair to a physician because leaving the practice may require the physician to relocate. And patients may become confused and distraught after their physician leaves without offering to continue to be their doctor.

Telemedicine is emerging as a new way of delivering patient care. However, as this patient care model is emerging, doctors may switch from one telemedicine company to another.

Rowe explains that telemedicine companies generally do not place noncompete agreements in their contracts and that doctors can work for more than one telemedicine firm at a time or sequentially without incurring any noncompete violations.

Rowe explains, however, that she has encountered several doctors who were prevented from taking on telemedicine as a side job due to a noncompete clause imposed by their employers.

Hospitals and medical practices can’t survive without physicians. A physician could certainly take his or her good reputation and loyal patients and leave a practice. A noncompete agreement often presents an obstacle to doing that.

When a physician is considering an employed position or group practice with a noncompete agreement, it is a good idea to discuss the expectations. A doctor needs to openly acknowledge to potential employers or partners that the working relationship needs to be evaluated first before anyone can agree to take a major financial loss for breaking ties. And working out a noncompete agreement that is fair for everyone is one of the ways to ensure that all parties have a reasonable timetable to evaluate the professional partnership and see if it is a good fit.

Noncompete agreements are frequently challenged in legal cases.

“Many states do not allow noncompetes and some states have legislation in the works,” Appino says.

But he still encourages doctors to check all local laws, explaining that even when a doctor hears that a noncompete is unenforceable, the contract may have predetermined damages that are tough to fight against.

How to navigate physician noncompete clauses

It’s always a good time to do a financial review. You’ll make sure your savings and investments are aligned with your goals and reduce income taxes.

Review IRA, 401(k) and other retirement plan contributions.

If you didn’t fully funded your retirement plan(s) in 2020, this year you should consider what you can afford to salt away. Contributions to 401(k) plans reduce your taxable wages. Many employers will let you make an additional one-time contribution up to the IRS limit.

You may be able to save on 2020 taxes by making deductible contributions to an IRA by April 15, 2021. If your income is too high to get a deduction because you or your spouse are also covered by a retirement plan at work, consider socking away money in a Roth IRA, which has more liberal income limits.

Review your asset allocation and rebalance if needed.

Confounding expectations, the stock market has boomed in the past year. As a result, you may find that your asset allocation is unbalanced.

Suppose a few years ago you set your allocation as 50% equities (stocks and stock funds) and 50% in fixed-income (bonds, certificates of deposit [CDs], fixed annuities, money markets and similar instruments). Thanks to strong market performance, you’re now 65% in equities and 35% in fixed income.

You’ve done well! Now it’s time to start reallocating to get back to 50-50. Reallocating money in retirement plans as well as annuities and life insurance policies takes less planning because gains here are not taxed until withdrawn.

Some people have enough money in their retirement plans so that they can accomplish their overall rebalancing using only these accounts. Remember, it’s your overall asset allocation that counts, not the allocation in any one account.

If you do need to rebalance your taxable investments, be aware of tax strategy. For instance, if you have unrealized losses, you can sell off losing investments to offset gains from selling your winners. If you’re rebalancing a lot of taxable money, you may want to consult a certified financial planner or certified public accountant for help.

Consider all your options. You may be able to get a better rate than you expect.

To boost the economy, the Federal Reserve has slashed short-term interest rates to close to zero. Today, most savings instruments like money market accounts, CDs and bonds pay very low rates, even if you’re willing to tie up your money for a few or several years. If you’ve got CDs or bonds that are about to mature, it pays to consider other options.

If you can afford to tie up your money until age 59½ or are already that age, there’s another choice that typically pays a higher rate: a fixed-rate annuity. Your age is important because if you withdraw money from your annuity before age 59½, you’ll owe the IRS a 10% penalty on the interest earnings you’ve withdrawn.

Also known as a multiyear guarantee annuity or a CD-type annuity, a fixed-rate annuity behaves a lot like a bank certificate of deposit, with some notable differences.

Like a CD, it pays a guaranteed interest rate for a set period, usually three to 10 years. Unlike a CD, the interest credited to the annuity is tax-deferred until you withdraw it.

While CDs today pay less than 1%, a three-year fixed annuity pays up to 2.4% and a five-year contract up to 3% annually. Annuities are not FDIC-insured but are covered by state guaranty associations, up to certain limits, that vary by state.

A fixed-indexed annuity is another choice if you don’t mind a fluctuating interest rate. It credits interest based on the growth of a market index, such as the S&P 500.

Indexed annuities are suited for people who want to save for the long term while limiting risk without precluding growth.

The listed beneficiaries on annuities, life insurance policies and retirement plans will receive the proceeds upon your death. Check that they’re up to date. Life changes such as marriage, divorce, the birth of children or grandchildren or the death of a loved one may require updating your beneficiaries.

If you’re married, your spouse is normally your primary beneficiary and your child or children are contingent. If you’ve been divorced and remarried, make sure your ex-spouse isn’t still the beneficiary.

Ken Nuss is the founder and CEO of AnnuityAdvantage, a leading online provider of fixed-rate, fixed-indexed and immediate income annuities. Send your financial questions to medec@mjhlifesciences.com.

It’s always a good time to do a financial review. You’ll make sure your savings and investments are aligned with your goals and reduce income taxes.


Review your finances now to keep on track in 2021

s physicians we are quite familiar with methods in discovering the health of our patients. We use measures such as HDL:LDL ratio, waist-to-height ratio, waist-to-hip ratio and many other measurements to determine the health of our patients. In fact, we’re pretty good at it. We can even use this data to predict what problems the patients will face and even how long they might live.

Did you know there are similar ratios and methods that accountants and business leaders use to determine the financial health of a company? These ratios can tell you the financial health of your practice. I’ve listed the top five financial metrics that every physician should know and use every month.

These are just a few the financial ratios physicians can perform using income statements and balance sheets provided to them by their accountants and office managers. These ratios will help you determine the level of financial stability of your practice and help you make better decisions for your future. Financial health is hard work. Just like we ask our patients to keep track of their diet and exercise activity, we should also closely monitor the financial health of our practices. We must be diligent to actively manage our business.

One of the most important ratios to know is a solvency ratio called the current ratio. The current ratio is a simple calculation to perform but a few definitions are needed. When we say “current” in a financial report, we are indicating that we can either convert the asset into cash within a one-year period or the liability is due within one year. Current assets are assets we can convert to cash within one year. Current assets are cash, cash equivalents, accounts receivable (A/R), bad debt allowance and any inventory we have on hand. Current liabilities are bills that must be paid within one year. Current liabilities are all notes and accounts payable due within one year, interest payable, wages payable and income taxes payable.

The current ratio is an indication of the firm’s ability to pay back its short-term liabilities. To obtain this ratio, we take all of the current assets and divide them by the current liabilities. If the current ratio is less than 1, this indicates the company has more debt due within one year than it has assets it can use to pay those debts. This is a critical ratio for any company, particularly in medical practice. If your current ratio is less than 1, you need to seriously consider how your practice will survive should something happen to your cash flow.

Another ratio similar to the current ratio is the quick ratio or acid test. This is the same as a current ratio except that inventories are not included in the numerator. It looks at the most liquid assets and compares them against the current liabilities. If your practice does not hold inventory, then your current ratio is a quick ratio or acid test.

Days in A/R measure a company’s ability to convert receivables into cash. A low days-in-A/R number indicates that the practice can quickly collect on its debts.

This ratio varies from industry to industry. The important thing to watch is whether the number increases. If it is increasing, it should spur your staff to investigate why and find ways to bring the number back down. Every practice should know its general days in A/R. It is equally important to know the days in A/R for each payer class. How long does it take for the Centers for Medicare & Medicaid Services (CMS) to pay you? How long does it take for commercial payers to pay you? How long does it take to get paid by patients with health savings accounts? These are all important questions that can help you make better decisions and plan for the future. The calculation is performed by dividing accounts receivable by the revenue and then multiplying by 365.

Operating margin is a measure of what proportion of the company’s revenue is left over after paying the variable costs of production of the services or goods. These costs include wages, raw materials, etc. It is important to have a healthy operating margin so that the company has enough cash to pay its fixed costs. This is also known as an operating profit margin for the net profit margin. It is calculated by dividing the operating income by the net revenue.

These ratios will help you determine the level of financial stability of your practice and help you make better decisions for your future.

Medical Economics April 2021