Practice Management Q&As

May 6, 2005

Billing mistakes; Stark; mergers

Owning up to Medicare billing errorsQ. In reviewing charts to prepare for a Medicare audit, I discovered that my office had billed incorrectly for nursing home visits. Should I send CMS a letter acknowledging my mistake and include a refund of the overpayments? Or should I wait to see what the auditor says when he shows up?

A. Notify CMS about the error before the auditor comes. But don't send a refund until you receive a bill. It may include penalties, which are often negotiable.

Get paid for prescription management? Q. Can I use code 99211 to bill for medication changes I approve for patients who phone in their requests?

More important, you're setting yourself up for a malpractice charge if you routinely approve medication changes over the phone. You should examine patients before you authorize prescription adjustments.

Is this a Stark violation? Q. Can a number of independent practices pool resources to open an MRI center without running afoul of Stark laws?

A. Yes, but each office must independently be able to satisfy the "in-office ancillary" exception, which includes maintaining an office somewhere in the same building that is either:

How to pull off a successful merger Q. What factors should my partner and I consider in calculating whether a potential merger with two other practices will be profitable?

A. To forecast profitability, hire a neutral practice management consultant, with expertise in mergers, to prepare a cash-flow projection. He should consider the following: (1) Will the merger create savings in such areas as staff costs, rent, or supplies? (2) Will you be able to win more managed care contracts and attract more patients by offering more services or more-convenient hours? (3) Will a larger, merged practice be able to offer ancillary services?

Other things to think about: Do the doctors share the same practice philosophy? How will each party entering the merger be valuated? How will the parties be compensated? How do the parties get out (the "bailout") if the merger doesn't succeed?

Ask a job candidate about commuting? Q. The strongest candidate for our billing supervisor position lives about 30 minutes away from our urban practice and relies on public transportation. I'm concerned that she may have trouble arriving on time, or that she might be reluctant to work late, because she'll miss her bus. Is it okay to ask the candidate about this during her job interview?

A. Yes, you can ask whether she'll be able to arrive on time and, when necessary, stay late. The issue is a legitimate business concern unrelated to discrimination on the basis of sex, national origin, disability, or race. But it's not okay to ask a candidate whether she owns a car; the Equal Employment Opportunity Laws view that as discriminatory.

How to scale back bloated salariesQ. I've discovered that I pay my staff more than any other practice in my specialty in this community. How can I bring salaries in line without upsetting my employees?