By Emilie J DiChristina for PracticeFirst

As noted last month, physicians are facing increased pressures ranging from increased competition in the market, increased managed care penetration, decreasing reimbursement and increased paperwork related to the volume of exchange plans, etc.

As a result, there are many new types of organizations offering the potential to reduce some of the impact on physicians and their practices, including PHOs, MSOs, and more,

This month we briefly review the PHO. The PHO or physician-hospital organization is a joint venture between one or more hospitals and a group of physicians.

A PHO is usually a lower end stepping stone to MSOs, IHOs or Foundation models (which we will discuss in later months). The selling points to both physicians and hospitals which make the PHO an easier sell are:

  • The ability for the parties (hospital and physicians) to present a united front to payers, particularly in the managed care arena. This allows for greater leverage when bargaining and negotiating contracts.
  • The parties also come together to develop standards of care, standardization of equipment, formularies, implants, and sometimes even staffing models as a method of controlling cost and demonstrating value.
  • There are shared services (supported financially by both parties) related to payer credentialing, quality, utilization management including care coordination – all taking pressure off of the physician offices to meet these requirements according to contract requirements.
  • There is usually an IT services component as well, assisting all parties in aggregating the data necessary to meet requirements related to demonstrating value.
  • Other than sharing services (for which there is shared financial risk), and presenting a united front to payers, each party to the PHO retains their autonomy.

Some potential downsides to the PHO include:

  • To avoid concerns of antitrust, the PHO must entail significant elements of risk sharing for the both parties.
  • Individual autonomy can result in roadblocks to agreements on standards of care, equipment to be used, and patterns of utilization reducing the PHOs bargaining power on value.

In summary, the PHO is often the starting point, and it does achieve the desired goals of increased bargaining power, increased hospital traffic to the hospital(s) part of the PHO, and certain operational efficiencies. It does not however offer the strongest corporate structures and shared risk/benefits of other models.

Look for more next mon


By Becky Amann, Compliance Manager


Aetna has recently issued communication requiring all participating providers to register for EFT or be automatically enrolled in Virtual Credit Card (VCC) payments. VCC payments should be avoided as it requires a separate transaction by the provider to initiate the credit card transaction in addition to the cost that the provider will incur to process that transaction by the credit card merchant. Based on the communication we have received from Aetna, VCC payments will begin on August 1, 2014 for all providers, if EFT’s are not in place.

Practicefirst values our partnership with you and is willing to initiate EFT registration for you at a reduced fee based on Aetna’s requirement. The nominal fee will help cover a portion of our costs. If you would like us to provide you with this service, please contact Becky Amann at 716-348-3902 or

Note: If our Practice Management Agreement with you indicates that this type of registration/enrollment is included in the contract as PF’s responsibility, we will submit the registration on your behalf, if you are not currently enrolled in EFT’s for Aetna.

Please notify Practicefirst prior to enrolling in EFT and/or VCC for any payor.


The HIPAA privacy and security rules require all Covered Entities (Providers) to obtain satisfactory assurances from their Business Associates (e.g. Practicefirst) to appropriately safeguard PHI. This is accomplished by a Business Associate Agreement (BAA). As a courtesy to our clients who did not have a working BAA with its vendors, we provided you with a BAA when we began servicing your account. It is the responsibility of Providers to ensure the BAA remains current. Based on the latest revisions and modifications to the privacy and security rules, it may be necessary to update the BAA. If you would like PF to review the BAA that we provided to you or you provided us for signature, to determine if any modifications are necessary, we can provide that service to you for a nominal fee. If you are interested in that service, please contact Becky Amann at the phone number / e-mail address below.

The BAA can be used as a template for any of your Business Associates where an agreement is required (e.g. record/data storage and disposal companies).

For Compliance questions, please contact Becky Amann at 716-348-3902 or



By Sarah Howarth, Billing Manager


On May 1 2014, Independent Health began issuing new ID cards with new ID numbers to members.  Please ask Independent Health patients for a copy of their new ID card, update your systems with their new ID number and notify Practicefirst of the change.


National Government Services will be conducting service-specific prepayment reviews targeting E&M services.  The primary focus of the reviews will be to identify common errors, develop educational efforts and prevent improper payments.  These prepayment audits will review documentation to determine if it supports the service billed.  If you receive correspondence from National Government Services requesting documentation, please notify Practicefirst immediately.

The Centers for Medicare & Medicaid Services (CMS) has identified issues relating to the processing of claims for new patient visits billed by the same physician or physician group within the past three years.  CMS has determined that the edits implemented in October 2013, generated incorrect overpayments and denials for some claims.  CMS will be issuing refunds on any offset or recouped payments and interest in the next 90 days.


Effective June 16, 2014, Univera Healthcare, Univera Community Health, Excellus and Monroe Plan will require a taxonomy code on all claim submissions.  Claims submitted without taxonomy will be returned.  Practicefirst has implemented the necessary changes to include taxonomy codes on claim submission.


We are nearing the halfway mark of the 2014 PQRS reporting period.  To avoid the 2016 payment adjustment, individual providers must report a minimum of 3 measures for at least 50% of eligible Medicare fee for service patients throughout the reporting period.  Providers interested in obtaining the 2014 PQRS payment incentive must report on 9 measures for at least 50% of Medicare fee for service patients throughout the reporting period. The reporting period begins January 1st and ends December 31, 2014.  Providers interested in avoiding the payment adjustment and/or obtaining the payment incentive, must begin reporting immediately.

Additional assistance in determining appropriate measures and claims reporting is available.  Please contact Practicefirst for more information.


Silent PPO is the term used to describe when a non-contracted payer or plan administrator applies a contracted payer’s fee schedule to services rendered by a provider, without the provider’s prior knowledge or consent.

The most common scenario is when a contracted network leases, for a fee, it’s contracted rates to a non-contracted network or administrator.

Tips to mitigating the impact of Silent PPO’s:

  • Review payer contracts.  Watch for “all payers” clause or similar verbiage which could be an indication that the payer leases its network.
  • If this language is present, contact the payer to request an updated contract network affiliated payer list.  Payers typically update these lists no less than every 90 days.
  • Know your contract term date(s).
  • Consider contracting directly with non-contracted payers, as justified by patient volume & fee schedule analysis.
  • Please notify Practicefirst prior to contracting with any network.

Note that there are times where practices decide to deliberately contract with a network. Carriers such as Multiplan have hundreds of payers that rent their network.  By participating with large, national networks such as this, please be sure your office staff is trained in recognizing the various logo’s etc. that give patients access to your practice, although you don’t directly contract with their insurance carrier.  For example, a patient presents with an Aetna insurance card, which you are not contracted with.  However, you are contracted with Multiplan.  If the card has a Multiplan logo on it, that patient can be treated as they’d be considered “in network” due to your contract with the network, Multiplan.

For Billing questions, please contact Sarah Howarth at 716-348-3923 or sarahh@pracfir


By Emilie J DiChristina, MBA for PracticeFirst 

It will come as no surprise to anyone reading this that financial and time stressors are continuing to plague physicians and health care providers who are either in single provider of small practice settings.

Prior to the start of the ACA implementation it was predicted that the ACA would be the final straw for many physicians. Further, it was predicted that combining with the retirement of physicians, there would be a shortage of people entering the profession of medicine, a heavier reliance on mid-level or non-physician providers, and of course…an onslaught of newly insured.

Guess what, everything predicted is being proven correct to some extent, and with declining enrollments and a change from the “carrot & stick” approach to quality to a “STICK & really, really tiny carrot” approach – non-retiring physicians are scrambling for a way to survive.

So providers are facing choices. Which are you planning to choose? Are you:

  • Retiring or going into research?
  • Hiring large numbers of mid-levels to increase productivity (read # of patients seen per hour)?
  • Trying to become a PCMH?
  • Joining an ACO?
  • Selling your practice to a hospital?
  • Entering into some form of a Physician-Hospital arrangement (PHO)?
  • Considering joining a Management Services Organization (MSO)?

While the financial and life-style issues causing providers to adopt new ways of practicing are the same, some of the decisions by private practice physicians planning a change are in large part predicated on the age and/or specialty of the physician.

Younger physicians, fresh out of teaching environment take more readily to actual employment by a hospital or larger practice. Why? The primary reason is that they are not accustomed to autonomy fresh out of school, so they do not have an expectation of autonomy. Add to that set shifts, steady income (with or without bonuses) not reduced by the overhead of a private practice, and shared coverage and the “quality of life seems ideal. In many areas of the country, physicians working for hospitals even have union protection.

The physicians who are in the “middle age” of their practices are more likely to look for a PHO or MSO model to join in order to achieve efficiencies, economies of scale, and often, to insure there is a referral system established. This often seems to be a good model for specialty groups as well (e.g. radiologists, GYNs). An important decision point for this age group seems to be the ability to maintain full or partial autonomy, despite formalized linkages. The PHO or MSO model also requires governance and participation or buy-in from the providers who make up the entity, and the physicians in this age group understand the responsibility and the benefit of participation, even if it takes time away from the family.

The younger “middle aged” physicians are also those who feel most comfortable with establishing their practice as a PCMH, adding mid-levels and sharing space with specialists or support services to provide the “home” model for their patients.

The older, established physicians are indeed contemplating different models of practice as well. They however are looking to sell completely to a hospital or another provider, and step away from practicing entirely, or work part-time. They don’t want to work in an environment where that have no autonomy, they don’t want to worker harder as they should be facing an easier time of life, they are not as tech savvy and the EMR/Meaningful Use and ACA requirements are NOT what they got into medicine for…

So, where are you in the scheme of things? What moves have you made? What moves are you contemplating? Is someone making you feel like the choices they are offering is the best thing since sliced bread?

Well we can’t help you with making those decisions but over the next few months we will try to help you understand the pros and cons of the major practice models and linkages you may be considering.

Until then, if you have specific questions you wish answered, feel free to email them to us at


By Becky Amann, Compliance Manager


In early April, MOIG announced their Work Plan for 2014-2015. The Work Plan covers the period of April 1, 2014 through March 31, 2015. Some of the reviews that MOIG intends to carry out during this time frame include:

Kickbacks and Inducements

Providers are prohibited from offering, soliciting, giving, or receiving any referral fee, rebate, discount, bribe, or kickback, whether in-kind or financial, in return for referring, accepting a referral from, or providing services to, a Medicaid consumer. OMIG will work to identify providers who have engaged in kickbacks and inducements.

Location of Services Unknown to New York State Department of Health

Medicaid providers are required to inform DOH of any new service location and newly closed locations. OMIG will identify providers with service locations that have not been disclosed and upon identification, report this information to DOH.

The entire OMIG Work Plan can be accessed at:



PF’s Corporate Compliance Committee (CCC) recently addressed the coding and billing of the Pulse Oximetry. CMS assigned a Status “T” indicator to the procedure code (94760) for the Pulse Oximetry, as reflected in the Medicare Physician Fee Schedule. The definition of Status T in the Medicare Claims Processing Manual indicates: There are RVU’s and payment amounts for this service, but they are only paid if there are no other services payable under the physician fee schedule billed on the same day by the same provider. If any other services payable under the physician fee schedule are billed on the same day by the same provider, these services are bundled into the physician services for which payment is made.

This means that the Pulse Oximetry is not reimbursable when billed in conjunction with any other services on the same date of service.

From a medical standpoint, insurance carriers could question the medical necessity of the Pulse Oximetry (94760), if it does not relate to a respiratory or heart related condition or complaint.

Based on our CCC’s review of this procedure, we would like to communicate to our Coding clients, that the Pulse Oximetry will only be coded if the Pulse Oximetry is documented as a component of your medical decision making.  You can do this by making a statement that you “interpreted” the pulse oximetry.  In addition, our Certified Coders will look for evidence of medical necessity i.e. respiratory and/or heart related complaint or condition.

The CCI edits indicate that a modifier is needed to “unbundle” the Pulse Oximetry from an E&M billed on the same dos. However, our Coding Dept. will not append any modifiers in an attempt to “unbundle” this code, based on the Status “T” indicator that CMS assigns to this procedure.

For Compliance questions, please contact Becky Amann at 716-348-3902 or beckya@pracfir


By Sarah Howart, Billing Manager


Payment adjustments for the Medicare EHR Incentive Program will begin on January 1, 2015. To avoid the payment adjustments providers must demonstrate meaningful use. Providers may qualify for an exception to the adjustment by submitting a hardship exception application and supporting documentation.  Applications are due by July 1, 2014.  Approved exceptions are valid for one year; previous exceptions will not be valid for 2015.  For additional information please review the Payment Adjustments & Hardship Exceptions Tipsheet for Eligible Professionals available at:


On April 1, 2014, President Obama signed into law the Protecting Access to Medicare Act of 2014. This new law prevents a scheduled payment reduction for physicians and other practitioners who treat Medicare patients from taking effect on April 1, 2014. This new law maintains the 0.5 percent update for such services that applied from January 1, 2014 through March 31, 2014 for the period April 1, 2014 through December 31, 2014. It also provides a zero percent update to the 2015 Medicare Physician Fee Schedule (MPFS) through March 31, 2015.


The NYS Legislature has repealed the authorization for payment of an incentive to eligible pharmacies and medical practitioners for approved ambulatory Medicaid e-prescriptions. As a result, effective April 1, 2014, payment of an incentive to eligible pharmacies and medical practitioners for each approved ambulatory Medicaid e-prescription, plus a maximum of five refills per prescription, is discontinued.


Individuals who purchase health insurance through New York’s health insurance marketplace, and receive a subsidy to assist with premiums, have a three-month grace period to make premium payments.  During the grace period, insurance companies may not dis-enroll members. However, during the second and third months of the grace period, insurers may pend the processing of claims, and ultimately deny such claims, if the premium is not paid by the end of the grace period.


For Billing questions, please contact Sarah Howarth at 716-348-3923 or