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What one doctor has done about compliance

There’s no sure way to avoid a Medicare audit. But this physician’s plan has worked for him–so far.

In 1997, internist Thomas F. Mann began to develop a compliance plan for his practice’s clinical laboratory shortly after HHS’s Office of Inspector General released its compliance guidelines for labs. "I read like crazy, went to conferences and workshops, and attended seminars organized by consultants," he says.

Mann wrote a 15-page plan, which generally follows the seven steps that the OIG has outlined in all of the compliance guidelines it has released over the past few years. A consultant reviewed the plan before it was put into operation. From beginning to end, Mann spent about 60 hours. "Basically, I started from scratch," says Mann. "With the publication of OIG’s physician office guidelines, the job should be easier. For the average practice, I think it could be done in 15 to 20 hours."

While Mann was creating the plan for the lab, he realized his practice would benefit from a comprehensive compliance plan that covered all clinical services. Mann is one of 10 physician-owners of the Greenbrier Clinic, a diagnostic center in White Sulphur Springs, WV. The clinic, which is affiliated with the Greenbrier resort, caters to executives and others who travel there to receive exhaustive examinations. By its nature, the clinic orders more screening services than a typical practice. "We are an outlier in the eyes of many carriers," says Mann. "And we recognize that increases our risk for an audit."

In 1998, Mann’s compliance plan grew to 25 pages, so that it applied to the whole practice. Mann became the compliance officer. "The position came to me by default since I’m the lab director," he says. Recently, he assigned one of the clinic’s certified coders to work half-time as his compliance assistant.

At first, Mann’s compliance work was time-consuming. "I spent a lot of hours reviewing audit sheets and coding with doctors," he says.

These days, Mann spends two or three hours a week executing his duties as compliance officer. He confers with the coding department every day, consults with the business office once a week, holds a monthly compliance meeting with the department heads, and organizes a small conference for physicians and staff each year. And he’s always available to colleagues and staff members. "I have an open-door policy. Someone calls me, and I deal with the problem right then," he says. "Compliance became a way of life."

Mann estimates that compliance costs his practice about $15,000 a year, which includes the salary of his part-time assistant, staff training, conference expenses, and newsletter subscriptions–but not compensation for Mann’s labor.

In addition to increased expenses, a compliance program causes a practice to lose revenue. "Though the OIG says it’s cost-effective, it really isn’t," says Mann. "You’ll bill for fewer services After all, that’s the point."

The cost is not always in dollars, either. In the Greenbrier Clinic’s case, compliance cost it a physician. "One of the internists in our practice–an exceptional physician–retired at 56," explains Mann. "He quit rather than deal with the extra worry and hassles."

The added hassles, according to Mann, are likely to consume at least an hour of the average practicing physician’s time each week. "There’s writing or dictating information into the record that needs to be there only for billing purposes. There’s also proofreading notes, making quick calls to the coding department, and so on," he says. "Multiply that extra effort by 20 patient encounters a day, and you’re looking at a lot of time taken from patient care or your family."

Despite the monetary and emotional costs, Mann wouldn’t be without his compliance plan. "Having a plan is critical," he says. "Even with a minor audit, you could face substantial legal and consultant fees in addition to what you might have to repay the government. That’s a pretty big hit."

To date, the Greenbrier Clinic has not been audited by Medicare. Nevertheless, Mann is prepared. His clinic’s smoothly running compliance plan is well documented: a 25-page manual plus binders full of supporting newsletters, conference reports, and correspondence. "If the OIG auditors walked in the front door and asked to see our compliance program," Mann says, "I would be ready in 15 minutes."

—Michael Pretzer
Washington Editor

For a more in-depth look at compliance plans, see "Compliance plans: How optional, really?" See also "Risky business: Where you’re most likely to make a billing error."

Michael Pretzer. What one doctor has done about compliance.

Medical Economics

2001;2.