Q Storage is getting tight. How long do I need to retain my patients’ records?
AThe American Health Care Association has issued guidelines on this topic that are easily adapted to chiropractic needs. Health-care considerations are the primary basis for deciding how long to retain health-care records. First consider whether a doctor would want the information if he or she were seeing the patient for the first time. Before discarding old records, try to give patients an opportunity to claim their records.
If a particular record no longer needs to be kept for health-care reasons, check with state laws to see if there is a requirement that records be kept for a minimum amount of time. Most states do not have such a provision. If they do, it will most likely be part of the statutory code or state licensing board. Medicare or Medicaid records must be kept at least five years.
Health-care records should be kept for at least as long as the length of time that the statute of limitations for malpractice claims runs. The statute of limitations means the amount of time that a patient has to sue you for malpractice. The statute of limitations may be three or more years, depending on your state laws. State health-care associations and insurance carriers are good resources for this information. Whatever the length of the statute of limitations, measure time from the last professional contact with the patient. If a patient is a minor, the statute of limitations for health-care malpractice claims may not begin to apply until the patient reaches the age of majority.
To preserve confidentiality when discarding old records, be careful that all documents are destroyed. Consider investing in a paper shredding machine that cross-cuts the documents.
Q I have an opportunity to purchase a practice for $150,000. The selling doctor wants the contract to state that the purchase price is $100,000, and he wants me to give him a personal check in the amount of $50,000 for the balance. I have checked with my accountant, who has told me that this is all right because a lot of practices are sold this way. What do you think?
A I think you should make arrangements to get a new accountant. Helping another person evade paying taxes can be construed as aiding and abetting and is a criminal offense. It’s possible that the doctor selling you the practice is unaware that he has asked you to commit a criminal act, but I doubt it. If he is willing to defraud the government, he’s probably more than willing to defraud you.
I suggest you double-check all the information furnished to you by the selling doctor to make sure he has not been “cooking the books” of his practice. Do not accept verbal representations. Make sure everything is in writing and that your contract calls for stiff penalties in the event he has misrepresented the practice to you. Make certain that the provisions concerning misrepresentation penalties “survive” the closing.
Q I am a new practitioner, and I have been asked to join a PPO. What is a PPO and how exactly does it differ from an HMO?
A A PPO (preferred provider organization) is a prepaid health-care plan. Members of the plan choose health-care providers who have contracted with the plan to provide services at a discounted rate. Payment to the provider is generally fee-for-service rather than the capitation method. If the member secures services from these “preferred” providers, they are provided coverage similar to that of an HMO (health maintenance organization). Members are permitted to go outside the plan but will be required to pay higher co-payments if they do so.
Because PPOs use pre-admission certification and utilization and quality reviews, it is easier for a PPO to control costs than those systems that use a fee-for service method. Unlike HMOs, PPOs usually do not assume actuarial risk for services delivered by the network, although some states require that PPOs be licensed and/or adequately capitalized. Furthermore, although some states do regulate PPOs, there are no federal statutes or regulations that regulate PPOs.
There are four basic types of preferred provider organizations. Their differences arise from the entity that sponsors the particular PPO. All types enter into contracts with provider networks, which will deliver services to enrollees in a health plan in accordance with a negotiated fee schedule, usually in the form of discounts from charges, bundled charges, per diem rates, or payments based on ambulatory patient groups or diagnostic related groups (DRGs).
The main types of PPOs include:
The Licensed Insurer: A licensed insurer contracts directly with providers and forms a PPO network containing those contracted providers. The insurance company then sells its panel of providers directly to employer health plans and other health-care purchasers. The PPO is merely one of the products that is sold by the insurance company.
The Intermediary (Broker): Intermediaries are generally independent management companies or insurance brokers. An intermediary-sponsored PPO contracts with providers directly. Such a PPO sells its panel of providers to both other insurers and employer health plans.
Employers: A self-insured employer (an employer who bears the risk of insuring its employees itself) selects a panel of preferred providers to provide health-care services to its employees. Occasionally a group of employers will join together for this purpose.
Providers: Either a group of individual providers or a hospital and the physician members of its medical staff will market their organization to insurance companies, employers and other health-care purchasers.
At a minimum, make sure the following clauses are included in your PPO agreement:
- Specify the type of efforts the PPO must provide (“steerage”) in order to ensure that patients will use your services (a “best efforts” clause is insufficient).
- Require that new payors who join the PPO after you join must also comply with steerage requirements.
- Include a list of PPO payors and require that you be notified of all new payors as they join the PPO and that you are advised of all payors as they leave the PPO.
- Specify that the discount will only be granted to PPO payors and their respective members.
- Retain the right to approve of new payors.
- Establish audit procedures.
- Require patients to submit proof of membership in the PPO.
- Require a confidentiality clause concerning your discount information.
- State time limits for payment.
Q I have had several bills rejected because of a denial of medical necessity. Is it worth my while to pursue this matter?
AMore than 50% of medical necessity denials are reversed on appeal. If you win on appeal, you will get your money back, it will vindicate your billing practices, and can also dispel future problems arising from post- payment review. If you do not appeal such medical necessity denials and you are subsequently audited, it would be difficult to prove that you thought your services were reasonable and necessary since you did not bother to appeal the denial.
In most cases, you have nothing to lose. Many lawyers who accept these types of cases will accept a percentage of the interest paid by the third-party payor as their fees.
