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Q I use a billing company that bills a percentage of the money that it collects for me. Is this a problem?
A Your billing company may not receive a percentage if you are billing Medicare. The purpose of these rules is to ensure the biller has no financial interest in the amount billed or collected. In order to be paid, the billing company must have a written contract with you setting forth the terms of the agreement. Payments to the billing company should be based on “fair market value” (the going rate in your community) and may not be related to the dollar amounts billed or collected. The billing company should get paid its fee regardless of collection. You must retain the right to modify or revoke payment instructions at any time and, in receiving payment, the billing company may only act on your behalf. The billing service may deduct its payment before sending you your Medicare reimbursement payment.
These provisions do not apply in those situations where the billing agent merely prepares your bills but does not receive the reimbursement checks or is not permitted to endorse them. These provisions may or may not apply with respect to private third-party insurers, depending on the state laws where your practice is located. Some states do not permit billing companies to be paid a percentage, because such payment could be construed as fee-splitting.
Q What do I need to do to show that I have tried to collect co-payments or deductibles?
A The automatic waiver of co-pays and/or deductibles can result in charges of fraud and abuse. In addition, failure to pursue payment of co-pays and deductibles can result in charges being brought against you.
Send three letters plus make a documented telephone call to every patient who has an outstanding co-pay or deductible. Keep a written file of the person in your office who made the call, the person with whom your office spoke and the substance of the conversation.
Q I am hiring an associate and I want to make sure he doesn’t take my patients and open up across the street, if and when he decides to leave my practice. Can I make him sign a contract that states he will never practice chiropractic within 200 miles of my office?
A No. As a general rule, the courts do not like “non-compete” clauses because they feel the clauses restrict trade. As a result, certain states do not permit non-compete clauses at all. Those states that do permit them, enforce them very narrowly. For instance, if a non-compete clause is very limited in time and geographic area, the court will most likely enforce it; but if it is too broad, the courts will consider the clause invalid.
You should check with your health-care attorney concerning the validity of non-compete clauses in your state. If they are not prohibited and there are no specific rules concerning them in your state, I would suggest limiting the time frame to no more than two years. The geographic area restriction would depend on where your practice is located. For instance, if you are located in a major city such as Manhattan or Los Angeles, a 5-block radius is sufficient; if you are in a suburban area, a 5-mile radius should be okay; and if you are in a rural area, 15 miles would be the maximum radius that I would recommend.
Ms. Green has been a practicing attorney since 1977. She is admitted to the practice of law in New York and Florida.
Because this column is being presented to you by an attorney, it would not be complete without a legal disclaimer. This column is provided subject to and governed expressly by the terms of this disclaimer. This column is provided for educational purposes only. The accuracy or timeliness of the information presented herein is not warranted. The information presented herein is not intended to be advice as to a specific fact pattern with which you may be presented. Accordingly, please note that the information contained herein is not being presented as legal advice with respect to any matter and that no attorney-client relationship is hereby established.