Issuu on Google+

Spring 2011

The Bulletin Inside this Issue: FEATURE: Accountable Care Organizations (ACOs) The Regs Are Out—Now What?…(See page 9) Order your copy of CPLH!…(See page 12) PHYSICIAN WANTED…(See page 15) Save the date for our Annual Member Social…(See page 17) Office Staff Event—Don’t Let Your Staff Miss Out!…(See page 17)

Spring 2011

Page 3

Our Mission The mission of MMCMS is to promote the science and art of medicine, the care and well-being of patients, the protection of the public health, and the betterment of the medical profession; to cooperate with organizations of like purposes; and to unite with similar societies in the State of California as component societies of the California Medical Association.

MMCMS Leadership Officers David Simenson, M.D. President Nirmal Aujla, M.D. President-Elect Samuel B. Tacke, M.D. Secretary-Treasurer F. Allen Rutledge, II, M.D. Immediate Past-President

Governors Donald P Carter, M.D. E. Kip Hensley, M.D. Timothy A. Livermore, M.D.

CONTENTS MMCMS President’s Message—David Simenson, M.D. What have MMCMS/CMA been doing lately?.......................................................... 5

Executive Director’s Notes—Chrisy Muchow ................................................ 5 California’s Budget Disaster ................................................................................ 7 Accountable Care Organizations (ACOs) The Regs Are Out—Now What?........................................................................... 9 News from the California Medical Association ....................................... 11 CMA’s Legislative Agenda 2011-2012............................................................ 11 Immediate action required to avoid the 1% e-prescribing penalty in 2012 ................................................................ 11 CMA publishes resources to help physicians transition to the new HIPAA 5010 transaction standards .................................. 13

Brian Moore, M.D.

Health reform CO-Ops will be attractive to California physicians, but face many barriers, CMA tells HHS.......................... 13

Atul T. Roy, M.D.

Medi-Cal begins processing claims using NCCI edits ............................. 14

Mark W. Via, M.D.

Register today for CMA’s new website and update your “Find a Physician” profile ...................................................... 14

CMA Delegates

Palmetto GBA to conduct E&M audit ............................................................... 15

James H. Jones, M.D.

Medical staffs’ relationship with hospital boards subject of new medical-legal document .................................................. 15

Pamela Roussos, D.O.

CMA Alternate Delegates Stephen F. Corcoran, M.D.

Meeting Schedule................................................................................................... 17 Things to Note... ....................................................................................................... 19

Eduardo T. Villarama, M.D.

Survey Summary and Questions Answered from the 2/24 Meeting....................................................................................... 19


FREE—EHR Desk Reference! .................................................................................. 19

Chrisy Muchow Executive Director

For Advertising Opportunities Contact Chrisy Muchow at (209) 723-2976 or The Bulletin is published quarterly by the Merced-Mariposa County Medical Society, 2848 Park Avenue, Suite C Merced, CA 95348. Phone (209) 723-2976; Fax (209) 723-8371; E-mail; Website The Bulletin does not assume responsibility for author’s statements or opinions; opinions expressed are not necessarily those of The Bulletin or the MercedMariposa County Medical Society. Acceptance of advertising in The Bulletin of the Merced-Mariposa County Medical Society in no way constitutes approval or endorsement by MMCMS of products or services advertised, and MMCMS reserves the right to reject any advertisement.

Spring 2011

Page 5

President’s Message— David Simenson, M.D. What have MMCMS/CMA been doing lately? I’d like to give you all an update on what your County Medical Society has been doing lately. In February we had our General Membership meeting where the speaker was Dr. James Hay, the CMA President-Elect. He gave a knowledgeable presentation. In March Dr. Tim Livermore and I went to Los Baños to address the medical staff. Dr. Livermore gave a presentation on the work of the Public Health Department, and I explained the purpose of our Medical Society and the CMA, and asked them all to consider becoming members. In April, Chrisy Muchow and I went to Sacramento for the CMA Legislative Day. We met with our Assembly Member Cathleen Galgiani and our Senator Anthony Cannella. They both stated they are in favor of supporting MICRA. We also advocated against current bills that would weaken the bar against the corporate practice of medicine in California. Also in April we held a NORCAL CME Event, "Feats and Failures of EHR Implementation" at De Angelo's for 1 hour of CME. You should have already received our Annual Report. On May 14 there is a CMA-sponsored conference on "Strategies for Independent Physicians to Collaborate and Succeed in the Era of Health Reform" in French Camp. Then on May 23 there is an Office Manger/Billing Staff event, "The CERT Error Rate for California is Above the National Norm! What can we

do to change that?," sponsored by Palmetto GBA, California’s Medicare Contractor. Our Annual Member Social will be held again at Fernando's Bistro on June 15. If we have good luck with the weather, we will be able to stay out on the patio. Last year we were driven indoors by wind and rain. We will host a welcome and orientation for the new Family Medicine residents on June 30 at Mercy Medical Center. Our new Membership Directories will be distributed the first week of July. If the Society does not have your recent photograph (sorry, that pic from 20 years ago is out of date!) please contact Chrisy Muchow right away. The CMA is offering a series of webinars which are free to CMA members. These can be viewed at home, at your office, or at the hospital on any computer with an Internet connection. Upcoming topics include EHR Overview, ICD-10, Best Practices for Working Your Accounts Receivable Reports, and E&M Coding – Don’t Leave Money on the Table. You can get more information on these topics and others at http:// David Simenson, MD MMCMS President

Executive Director’s Notes— Chrisy Muchow As you can see from Dr. Simenson’s article above, MMCMS has been very busy. We have been holding events and attending functions that are worthwhile to the organization and we intend to continue doing so. This is a busy time in the world of medicine and the only way to keep up is to remain educated. That is what MMCMS is here to do, help you stay educated and on top of the profession you love.

If you are not a member, I ask that you to contact me so that I can meet with you and discuss all of the ways MMCMS/ CMA can help you and your beloved profession. If you are a member of MMCMS/CMA, I would like to extend a sincere thank you for your continued support of organized medicine and offer my assistance should you need anything that MMCMS/CMA can help you with.

This edition of The Bulletin is mailed out to members as well as non-members and therefore, contains much information on what organized medicine is doing and has been doing to help all of the physicians of California.

To quote our website “Without our voice medicine would not be what it is today, but more importantly, without your voice medicine cannot be better. The louder the voice the better medicine can become.”

As you can see from this publication and many other mailings etc. that you might receive from MMCMS/CMA we are working very hard on behalf of physicians and the patients you serve.

Have a great day! Chrisy

Spring 2011

Page 7

California’s Budget Disaster April 13, 2011


he State of California started 2011 with a projected budget deficit of $25.4 billion – a $7.2 billion current-year deficit and an $18.2 billion deficit for the coming year. In order to build a $1 billion prudent reserve, the Legislature must pass a $26.4 billion mix of cuts, revenues, and fund shifts.

governor needed a vote of 2/3 of both houses of the Legislature, requiring two Republicans in each house to vote for it. The negotiations needed to secure those two votes abruptly ended in the last week of March, when Governor Brown declared an impasse.

In order to understand the magnitude of the deficit, it is helpful to understand that California’s Budget Deficit is easily the biggest of any state deficit. In fact, our two-year deficit is larger than the next two biggest deficits (Texas and New York) combined. Our $18 billion deficit for the coming fiscal year alone is larger than the total budget of 38 other states. California’s deficit amounts to $702 for every man, woman, and child in California.

Even if the current deficit is “solved,” there may be more to come. Many of the budget solutions passed by the Legislature and signed by the Governor include changes to Medi-Cal that require federal approval. The CMA and other organizations advocacy efforts are now focused on the Centers for Medicare and Medicaid Services (CMS), which oversees all state Medicaid programs, including Medi-Cal. It may be that CMS denies the State’s ability to implement the devastating cuts for which the Governor is asking.

The Legislature has already passed more than $14 billion in cuts and other spending reductions. These included deep cuts to health programs. If the remaining solutions come from additional cuts, we can expect some dramatic and severe changes to core State-funded programs. The State could for example completely eliminate the $13 billion it spends on the University of California system, the California State University system, and the entire community college system – combined, or the Legislature could completely eliminate the Medi-Cal program. It will be impossible to piece together a solution with small cuts. Eliminating the State Legislature for example would solve just 1% of the deficit ($250 million).

How Did We Get to This Point? The current-year budget deficit is the result of a confluence of negative factors. This year alone, California will face the loss of federal stimulus funding for Medi-Cal, the expiration of temporary tax increases passed in 2009, and the continuing economic recession. In addition, previous legislatures have relied heavily on shaky assumptions and one-time fixes and fund shifts to cover projected deficits. For example, last year the budget assumed $3.6 billion in increased federal funding which did not materialize. Also, a heavy reliance on using bonds to cover state functions has left California spending large amounts of money just to cover accrued debt ($2.9 billion this year). Overall, over 80% of budget solutions in the last three state budgets were either temporary, did not materialize, or added to California’s debt problem.

What is the Legislature Doing to Fix the Problem? In March, the State Legislature passed a mix of spending reductions and fund shifts to address more than half of the projected deficit ($14 billion). The Governor had proposed to cover the other half by calling a special election to ask voters to continue the expiring tax increases for another five years. In order to call the election, the

Is a Special Election Really Necessary? Legally, no. The Legislature could approve the tax extensions by a 2/3 vote of both houses. During the election last fall, and in subsequent speeches, Governor Brown promised the voters that he would seek their approval before raising any taxes. He continues to maintain that he will not raise taxes without a vote of the people.

Can’t the Legislature Pass the Budget on a Majority Vote? Yes. The voters gave them this power when they approved Proposition 25 last fall. However, the State Constitution still requires a 2/3 vote of the Legislature to raise taxes. In addition, the voters also approved Proposition 26, which requires a 2/3 vote to approve any new or increased fees of any kind. There is no way for the Legislature to raise revenue without some Republican support.

How will the State Budget Deficit Affect Health Care? Health and human services is the second-largest portion of California’s budget, trailing only public education. The $13 billion in State general fund spending alone in the Medi-Cal program is larger than the total budget of 31 other states. Much of State spending is mandated in law, therefore, it is almost impossible to cut the amount of money needed to fix the deficit without reducing health programs. The package of bills approved by the Legislature in March included more than $1.7 billion in cuts to Medi-Cal, including:  


A 10% across-the-board cut to provider rates ($730 million). Imposing mandatory co-payments on physician office visits, pharmacy, inpatient hospital stays, and non-emergency use of the ER ($557 million). A “soft cap” on office visits of 7 per year ($60 million). (See Budget, Page 22) PROVIDING PROFESSIONAL RADIOLOGY SERVICES TO Mercy Medical Center • John C. Fremont Hospital Castle Family Health Centers • Livingston Medical Group Patient’s First Medical Center and other Health Care Providers in the Greater Merced Area

P.O. Box 3649 • Merced, CA 95344 209-722-9729 (722-XRAY) • Fax: 209-384-9729

Spring 2011

Page 9

Accountable Care Organizations (ACOs) The Regs Are Out—Now What?


he Centers for Medicare and Medicaid Services (CMS) finally issued the proposed regulations on the Medicare Shared Savings/Accountable Care Organizations (ACOs) program on March 31, 2011. And while the political and legal battles regarding funding and implementation of the Patient Protection and Affordable Care Act (PPACA) continue, it is estimated that the ACO provision will remain intact no matter what the final outcome.

SO...WHAT IS AN ACO? The ACO concept couples payment and delivery system reform. ACOs are paid through a shared savings payment approach. ACOs allow physicians to be jointly rewarded for the efficiencies they achieve in both the Medicare Physician Part B and the Hospital Part A programs. Physicians in ACOs will continue to bill Medicare under the traditional fee-for-service program. If an ACO reports on quality measures, among other things, and achieves savings by meeting a cost benchmark, Medicare will share 5060% of the cost savings with the ACO. ACOs do not have to involve a hospital and may be physician-led and comprised of physicians only. CMA fought very hard to maintain such physician autonomy. ACOs can be primary care or multi-specialty medical groups, or they can be IPAs or other networks of individual physician practices, all with or without integration with hospitals.

WILL PHYSICIANS WANT TO PARTICIPATE? It appears that the regulations, as drafted, are unlikely to encourage California physicians or medical groups to participate. The regulatory framework and requirements are burdensome and the upside financial potential may not be worth the effort and may not cover the substantial start-up costs. See the following summary of some of the key provisions: In a controversial move, the regulations require ACOs to be responsible for “downside” financial risk. CMS is “proposing to implement both a one-sided risk model (sharing of savings only for the first two years and sharing of savings and losses in the third year) and a two-sided risk model (sharing of savings and losses for all three years), allowing the ACO to opt for one or the other models.” Under the first, “one-sided” risk model, an ACO that creates a savings of at least 2 percent would get 50 percent of the money above that threshold, but it would have no penalty if it spent more in the first and second year. Under the “two-sided” model, an ACO could receive 60 percent of the money above the threshold, but also would be penalized if it led to higher costs. By the third year of the program, all ACOs would become responsible for expenditures above the benchmark. While beneficiaries will continue to have the ability to choose any physician in the Medicare FFS program, they may be assigned to an ACO. Beneficiaries who choose a primary care physician who participates in an ACO will be “assigned” to that ACO. In addition, CMS is “proposing to assign beneficiaries for purposes of the Shared Savings Program to an ACO if they receive a plurality of their primary care services from primary care physicians within that ACO.” However, if a

beneficiary received the intensity of their primary care services from a physician outside the ACO, the beneficiary will be retroactively “unassigned” to the ACO for purposes of calculating shared savings. Beneficiaries will not be assigned to more than one ACO and will not receive advance notice of their ACO assignment. However, providers participating in ACOs will be required to post signs in their facilities indicating their participation in the program and to make available standardized written information to Medicare fee-for-service beneficiaries whom they serve. Additionally, all Medicare patients treated by participating providers must receive a standardized written notice of the provider's participation in the program and a data use opt-out form. An ACO must have at least 5,000 beneficiaries. If an ACO accepted into the program falls short of the 5,000 requirement, it will be placed on a corrective action plan. The ACO governing body must include some Medicare beneficiaries and representation from all ACO participants and the governing body cannot be controlled by non-ACO participants. According to CMS, ACOs “will be required to demonstrate a partnership with Medicare FFS beneficiaries by having representation by a Medicare beneficiary serviced by the ACO, in the ACO governing body.” CMS requires representation from all ACO participants in order to ensure all ACO participants are provided “an appropriate proportionate control over the ACO's decision-making process.” “In order to be eligible for participation in the Shared Savings Program, the ACO participants must have at least 75 percent control of the ACO's governing body.” CMS will set spending benchmarks based on Medicare expenditure data. CMS proposes to establish an individualized benchmark for each ACO based on three years of previous data. Whether an ACO will be eligible to receive shared savings, and how much, depends on a series of complex calculations that vary depending on the ACO's size and whether the ACO is using a one-sided or two-sided model. Most important to California physicians, the benchmark will then be riskadjusted for patients’ socioeconomic status and health status according to the Medicare Advantage methodology. The proposed geographic cost adjustments may not be adequate. To account for increases in costs, the benchmark will be further adjusted to the national health care spending growth rate instead of the local spending growth rate. Generally, the national growth rate exceeds the California spending growth rates. To be eligible to receive shared savings, the ACO must also meet certain quality standards. There are five standard measures for quality or areas. These include patient care giver experience, care coordination, patient safety, preventive health and at risk population/frail elderly health. CMS will designate scoring and measurement concepts. “Each of the [five] domains is equally weighted in determining an ACO's (See ACOs, Page 21)

Spring 2011

Page 11

News from the California Medical Association CMA’s Legislative Agenda 2011-2012 The 2011- 2012 legislative session is in full-swing, and the California Medical Association (CMA) Government Relations team is busy participating in stakeholder meetings, committee hearings, and one-on-one policy briefings with members of the Legislature. To date the Legislature has introduced 2577 bills, and CMA is watching and analyzing over 400 of them. Given the state’s financial situation, every bill is being reviewed for its fiscal impact. Nevertheless, CMA will strive for the development of beneficial policy for both physicians and their patients. This year, CMA is sponsoring five important bills on a variety of topics affecting the house of medicine: MEDICAL SCHOOL SCHOLARSHIPS: AB 589 (Perea) seeks to address patient access to care in underserved areas by making available medical school monies to physicians who agree to serve in those locales for at least three years, through the Steve Thompson Scholarship Program. We believe that steps like these are critical to attracting and retaining physicians in those areas, while also addressing physician shortages in the state. PEER REVIEW: AB 655 (Hayashi) will make positive changes in the physician peer review system by allowing certain information to be shared among hospitals or peer review bodies. This bill will provide a measure of transparency concerning physician’s records. PROFESSIONAL CORPORATIONS: LICENSED PHYSICAL THERAPISTS AND OCCUPATIONAL THERAPISTS: AB 783 (Hayashi) clarifies existing law that allows for medical corporations to hire certain allied health practitioners, most notably physical therapists. The longstanding practice recently drew fire from the Physical Therapy Board of California, who threatened board action against PTs who are currently employed in such partnerships.

POSTSECONDARY EDUCATION: GRADUATE MEDICAL EDUCAITON PAYMENTS: SB 347 (Rubio) aims to alter the amount of Graduate Medical Education (GME) funding that California receives in another effort to help address physician shortages in the state. MEDICINE: SB 742 (Yee), is language that CMA and other stakeholders are developing to help provide a substance abuse / mental health disorder treatment program to physicians. A safe path for treatment is a critical element in addressing these issues, and to keep physicians practicing safely in California. Additionally, CMA is opposing the following pieces of legislation: HEALTH CARE COVERAGE: MAMMOGRAMS: SB 173 (Simitian) RATE REGULATION: AB 52 (Feuer) RURAL HOSPITALS: PHYSICIAN SERVICES: AB 824 (Chesbro) PHYSICIANS AND SURGEONS: DIRECT EMPLOYMENT: AB 926 (Hayashi) OPTOMETRY: SB 920 (Hernandez) PHYSICAL THERAPISTS: DIRECT ACCESS TO SERVICES: SB 924 (Walters) For more information on these and other bills of interest to physicians, see CMA’s new issues database at http:// To view the CMA Legislative Hot List in pdf format, click here or contact MMCMS.

Immediate action required to avoid the 1% e-prescribing penalty in 2012 A change in Medicare law will penalize physicians beginning in 2012 if they don't implement and employ a qualified eprescribing system in the first six months of 2011. In 2009, Medicare introduced an e-prescribing program that encourages physicians to electronically transmit their prescriptions. The e-prescribing program provides payment incentives for physicians who e-prescribe and payment penalties for physicians who do not. Starting in 2012, Medicare will impose a 1 percent payment reduction penalty on all Medicare allowed charges for eligible professionals who do not electronically transmit their prescriptions. The penalty increases to 1.5 percent in 2013 and 2 percent in 2014.

The 2012 payment reduction penalty will be determined by eprescribing activity between January 1 and June 30, 2011. To avoid the penalty in 2012, eligible professionals must report eprescribing activity using measure code G8553 for at least 10 eligible outpatient visits via claims submission. This is true even for physicians who are already reporting through an electronic health record system. For more information, see CMA's e-prescribing guide, "Medicare Electronic Prescribing Overview: Payment Incentives and Payment Reductions" or contact MMCMS for a hard copy of the guide. Contact: Michele Kelly, (213) 226-0338 or (See News, Page 13)

Spring 2011

Page 13

News (Continued from page 11)

CMA publishes resources to help physicians transition to the new HIPAA 5010 transaction standards A new version of Health Insurance Portability and Accountability Act (HIPAA) transaction and code set standards become effective on January 2, 2012. On that date, all covered electronic health care transactions will have to comply with the new 5010 standards. It is critical that physicians start preparing for the transition to the new 5010 transaction standards to avoid rejected claims and cash flow interruptions. The HIPAA standards govern transactions involving claims and encounter information, payment and remittance advice, claims status, eligibility, enrollment and disenrollment, referrals and authorizations, and premium payment. If a covered entity conducts one of these transactions electronically, it is required to use the adopted standard, including standard code sets to identify diagnoses and procedures. Non-compliance with the HIPAA transaction standards may result in fines, exclusion from Medicare, and nonpayment of claims.

To assist physicians in this transition, CMA has published a resource sheet, "Are you ready for the Transition to HIPAA Version 5010?" The sheet, which includes practice tips for implementation from the American Medical Association and a list of additional resources for physicians, is available free to members in CMA's resource library. For more information, see also CMA medical-legal document #1606, "HIPAA Electronic Transaction Rule." Medical-legal documents are free to members in CMA's online resource library. Nonmembers can purchase medical-legal documents for $2 per page. Members may also obtain copies of the above referenced documents by contacting MMCMS. CMA Contact: Samantha Pellon, (916) 551-2872 or

Health reform CO-OPs will be attractive to California physicians, but face many barriers, CMA tells HHS The federal health reform law - the Patient Protection and Affordable Care Act (ACA) - calls for creation of non-profit health insurance plans, called CO-OPs (Consumer Operated and Oriented Plans), which can be operated by its community beneficiaries (consumers, providers and employers), but cannot be run by the government or an insurance company. "CMA believes that the not-for-profit, local governance CO-OP model will be attractive to California physicians and patients," said a March 4 letter to the U.S. Department of Health and Human Services (HHS) signed by California Medical Association (CMA) President James Hinsdale, M.D. CMA urged HHS to promote physician involvement in CO-OPs – on their governing boards and in their management and provider networks, noting that several rural and suburban-rural communities in California are interested in forming CO-OPs. "CO-OPs may be the only entities truly interested in insuring and serving their local rural residents. Therefore, if the ACA's goal is to expand access to affordable coverage options for the uninsured, particularly in rural areas, HHS should help to foster the CO-OP model," the CMA letter said. One of the greatest barriers to starting a medical insurance COOP will be the amassing of the financial reserves necessary to cover unexpected catastrophic claims and losses, the CMA letter noted. "Thus, CO-OPs will either have to carry large financial reserves or be forced to purchase reinsurance to mitigate unexpected catastrophic losses. The ACA provides $6 billion in loans and grants to help CO-OPs get started and to fund the necessary reserves. The loans must be repaid within five years of operation and can only be used for start-up costs. They cannot be used for lobbying or marketing.

Grants for reserves will be more substantial and must be repaid over a 15-year period. However, CMA warned that "there will be many barriers to entering the complex California insurance market," and urged HHS to allow flexibility in the ACA's loan and grant provisions to help COOPs develop in local communities. CMA urged HHS to explore ways the federal government could sponsor reinsurance to CO-OPs. "We believe a national reinsurance pool could foster the entry of CO-OPs into the California insurance market which would promote competition that would in-turn drive down premiums, improve physician participation and increase access to care." The CMA letter emphasized that in order for CO-OPs to provide access to comprehensive, quality patient services, they must have "robust provider networks of primary care and specialist physicians, who must be paid fairly and adequately. "First and foremost, HHS must ensure that the rates paid to insurers, including CO-OPs, participating in the State Health Insurance Exchanges be risk-adjusted to account for California's higher practice expenses (rent, non-physician wages) and the socioeconomic and health status of our population," the CMA letter said. CMA emphasized that CO-OPs must be able to pay physicians actuarially sound rates, which are essential to attracting and maintaining physician participation in a start-up CO-OP. For more information on CO-OPs, see CMA's Federal Health Reform Issue Brief, "Consumer Operated and Oriented Plans." Contact: David Ford, (916) 551-2554 or

(See News, Page 14)

Spring 2011

Page 14

News (Continued from page 13)

Medi-Cal begins processing claims using NCCI edits As required by the federal Patient Protection and Affordable Care Act (ACA) signed into law in March 2010, all state Medicaid programs, including Medi-Cal, began applying National Correct Coding Initiative (NCCI) edits for claims processed on or after March 28, 2011, with dates of service on or after October 1, 2010. The Centers for Medicare and Medicaid Services (CMS) developed NCCI edits in 1996 to promote national correct coding methodologies and to control improper coding leading to inappropriate payment in Medicare Part B claims. NCCI code pair "edits" are developed based on coding guidelines defined in the American Medical Association's Current Procedural Terminology (CPT) book, current standards of medical and surgical coding practice, input from specialty societies, and analysis of current coding practice. NCCI edits are pairs of CPT codes that are not separately payable except under certain circumstances. The edits apply to services billed by the same physician for the same patient on the same date of service. While the vast majority of billing and payment policies listed in the Medi-Cal Provider Manual follow AMA CPT coding guidelines

and, by default, NCCI code pair logic, it is advisable for physicians to familiarize themselves with these rules to ensure accurate coding and avoid denials, costly rework, and appeals. NCCI edits consist of two types: 1.

Procedure-to-procedure(Column1/Column2) edits that define pairs of HCPCS/ CPT codes that should not be reported together for a variety of reasons; and


Mutually Exclusive Edits/Medically Unlikely Edits, which are units of service edits, that define for each HCPCS/CPT code identified, the allowable number of units of service; units of service in excess of this value are not feasible for the procedure under normal conditions (e.g., claims for excision of more than one gall bladder or more than one appendix).

More information about Medi-Cal's policy on NCCI code pair edits can be found at the Medi-Cal website or on the CMS website. Contact: CMA's reimbursement help line, (888) 401-5911 or

Register today for CMA's new website and update your “Find a Physician� profile The California Medical Association (CMA) recently launched a new website designed for easier, more intuitive navigation and loaded with a suite of digital tools that will help you get the most from your membership. All members will need to activate their new web account in order to access the full suite of members-only tools and resources. Existing passwords from the old website were not carried over for security reasons. The process of activating your account is quick and easy, and will give you direct and immediate access to your account information and profile. To register: Click on "activate web account" at the top of the page. Enter your first and last name to locate your record in our database. Click on your name. Verify your date of birth, enter your email address (this will be your username), and then select and verify your password (passwords must be at least 6 digits long).

One of the new features is our "Find a Physician."

log in to your web account and verify that your profile is complete and accurate. You will also be able to specify what information you want to make public, what information you want available to members only, and what information you do not want shared at all. Once you have logged in to your account, the process for updating your profile is as follows: Visit your account dashboard by clicking on "My Account" at the top of the page. In the left column, click "Edit Profile." You will then see five tabs of information: basic information, address and phone, education, bio, and web account. Review each tab, make any changes necessary, and then click "save." Note: The fields that will appear in your website profile are marked with two check boxes, "public" and "members." If you would like a piece of information to be visible only to your physician colleagues, check "members." If you would like it to be available to both patients and physician colleagues, check both. If you have any questions or you do not want to appear at all in the physician directory, please do not hesitate to contact CMA's member help center at (800) 786-4262 or

To make sure that patients and your physician colleagues can find you using the Find a Physician search, we encourage you to (See News, Page 15)

Spring 2011

Page 15

News (Continued from page 14)

Palmetto GBA to conduct E&M audit The Palmetto GBA Medical Review department will be performing a prepayment review of CPT code 99214 billed by physician specialties in cardiology, family practice, and internal medicine. Palmetto identified that California physicians are two to three standard deviations above the norm as compared to other jurisdictions. This is not an audit of individual physicians, but a random sampling of three to four claims for each provider selected.

Physician signature and credentials, or an attestation statement to authenticate if the signature is not legible

If you are selected for sampling, requests for medical records will be sent to your practice. Physicians must respond to the requests for medical records or the claims will be denied. CMA suggests that physicians personally review the records returned to Palmetto in order to assure that there are no clerical errors. Records should include:

Any diagnostic test results that help substantiate the level of service

Legible copy of the patient's medical record for the listed date(s) of service

Medication list Patient name and date of service on each office note Consultation report or progress notes

Common problems that have accounted for 50 percent of claim denials are the result of missing signatures and illegible records. Lack of response from physicians is also a leading cause of denial. Physicians in the specialties mentioned above should look for letters from Palmetto in the mail in the coming weeks. Contact: Michele Kelly, (213) 226-0338 or

Medical staffs' relationship with hospital boards subject of new medical-legal document With more and more pressures on hospitals to improve quality and control costs, the California Medical Association (CMA) has received an increasing number of questions concerning how much authority that hospitals may lawfully have over hospital medical staffs.

 Peer Review

California has a long legal history of safeguarding the self governance right of hospital medical staffs. However, there are also laws that provide hospital boards with oversight authority over the medical staff. But those laws are limited.

 Codes of Conduct

To assist physicians and their medical staffs in understanding the complexities of these laws and the proper boundaries between the parties, CMA has recently created CMA On-Call medical-legal document #1279, "Medical Staff Relationship with Hospital Board." The document outlines the general principles of medical staff/ hospital board interaction and when and under what circumstances hospital involvement is permissible. Areas of such interaction discussed in the new document include, among others:

 Bylaws Amendment  Contracts

 Access to Peer Review Files, and  The Role of the Chief Medical Officer

CMA On-Call document #1279, "Medical Staff Relationship with Hospital Board," as well as the rest of CMA’s medical-legal documents are free to members in CMA's online resource library. Nonmembers can purchase medical-legal documents for $2 per page. Members may also obtain a copy of the above referenced document by contacting MMCMS. Contact: Samantha Pellon, 916/551-2872 or

PHYSICIAN WANTED Atwater Medical Group needs a physician to join our Family Practice/Urgent Care. Flexible schedule working only 12 days/month. Allows the physician to live in the Bay Area, Foothills, Fresno or Sacramento. Generous salary leading to full partnership. Contact: Eric Disbrow, M.D., Atwater Medical Group 1775 3rd Street, Atwater, CA 95301 • 209/358-5631 • Fax 209/358-0219

Spring 2011

Page 17

Meeting Schedule June 15, 2011

6:30 p.m.

Annual Member Social Fernando’s Bistro

July 11, 2011

6:00 p.m.

Medical Society Board of Governors Medical Society Office

August 29, 2011

6:00 p.m.

Medical Society Board of Governors Medical Society Office

September 22, 2011

6:30 p.m.

General Membership Meeting De Angelo’s Restaurant

Save the date for our

Annual Member Social This year’s Social will be held on the patio at Fernando’s Bistro Wednesday, June 15, 2011 Please check the mail for your invitation with further details and RSVP information!

Office Staff Event—Don’t Let Your Staff Miss Out! WHEN AND WHERE: 




Monday May 23, 2011  11:30am—2:00pm  De Angelo’s Restaurant    FACULTY: 

 



Sandra Siddall, MSN  Provider Outreach and Education  Palmetto GBA J1 A/B MAC    WHO SHOULD ATTEND: 

Staff of MMCMS Member Physicians $20.00  All Others $50.00    FOR FURTHER INFORMATION OR TO RSVP PLEASE  CONTACT MMCMS AT (209) 723‐2976 OR  CHRISYM@PACBELL.NET 


Office Managers and Billing Staff 

Part B 2011 Updates  Audit Proof Claims—  Reducing the Paid Claim Error Rate 



Stratford Evans Merced Funeral Home

1490 B Street Merced, California 95341 Phone: (209) 722-4191 Fax: (209) 722-4198 KENT FLORO Location Manager

FD #538

Spring 2011

Page 19

Things to Note... Survey Summary and Questions Answered from the 2/24 Meeting In February, we held our first General Membership Meeting of the year and James T. Hay, CMA President-Elect was the guest of honor. At that meeting we conducted a survey. Following are the survey results and answers to some of the questions asked on the surveys: There were 42 total attendees, 36 of which were physicians and we received 23 surveys. Please rate the overall quality of this presentation. Please rate the quality of the content of this presentation. Please rate the quality of the speaker’s performance. Please rate the overall quality of the venue.

Excellent 9 Excellent 11 Excellent 11 Excellent 13

Good Good Good Good

13 11 11 10

Fair Fair Fair Fair

0 0 0 0

Poor Poor Poor Poor

0 0 0 0

Some of the comments were: Nice to know our local Reps & Senators are pro-MICRA, topics related to practice of medicine and state of art lectures are likely to be of interest to members, venue is a good change, more presentations by CMA on Healthcare Reform as it unfolds, good conference, this was a very pleasant and informative meeting, the meeting environment is great, needs inspiring speaker.

Items noted as most valuable or enjoyable were: Update on MICRA, discussion of ACOs, comparison of State and Federal Rxs, all of it, different place, environment, style, MD Representation in legislatures, it was a good overview of the issues facing physicians & CMA in the next few years, update news, update about new laws, comments on MICRA, a review of current legislation. Items noted as least valuable or enjoyable were: Not enough on reimbursement, discussion of coming cutbacks.

Questions and comments that require response were: Q: The Society should arrange for counsel to review any bylaws changes requested by hospital gov. board prior to us voting. A: Unfortunately, MMCMS does not have the resources to hire counsel to review bylaws changes; however, CMA will refer any member physician to a “physician-friendly” attorney that the Medical Staff can hire to review the bylaws changes and MMCMS can assist in contacting the correct person at CMA’s Center for Legal Affairs. Also, the Medical Staff can join CMA’s Organized Medical Staff Section (OMSS) for $700.00 per year which entitles them to resources and assistance including CMA’s Model Medical Staff Bylaws, access to the CMA hotline for questions from medical executive committee members, chiefs-of-staff, and medical staff coordinators and discounts on bylaws review from a “physician-friendly” attorney. Q: What fraction of OB & Peds is Medi-Cal? A: As of this writing we were able to obtain information that about 28% of the patient population of Merced County is Medi-Cal; however, we have not yet received the specifics regarding the OB & Pediatric populations.

FREE—EHR Desk Reference! The California Medical Association (CMA) is pleased to introduce you to our Physicians EHR Desk Reference, which has been made possible by assistance from the CMA Foundation, the Texas Medical Association, and by generous support from The Physicians Foundation. This EHR Desk Reference is an easy to use resource developed in conjunction with practicing physicians to help other physicians and their staff members to make informed decisions about EHR selection, adoption, and implementation. This toolkit will help you to understand the federal EHR financial incentive programs and how to achieve meaningful use. Due to the terms of the Foundation grant, the reference will be made available to all physicians, regardless of their membership in CMA. To download this valuable resource go to and search for “EHR Desk Reference” or contact MMCMS.

Do you have patients with low‐mobility?   

*Seniors  *Handicapped  *Recently discharged   *Too ill or medicated to drive  *Young children   


PHONE: 209‐382‐1291 / 209‐382‐1245  QUALITY.SERVICE.DELIVERED! Your local independent pharmacy since 2000

Bilingual Staff Most Insurances, Medicare and Medi-Cal Accepted

Spring 2011

ACOs (Continued from page 9)

overall quality performance score, regardless of whether the ACO is in Track 1 or Track 2.” ACOs will also be required to report on 65 quality measures that are consistent with the current Medicare Physician’s Quality Reporting Initiative and the Meaningful Use standards. The measures are listed on pages 174 to 194 of the proposed regulations. ACOs must get approval for any changes in ACO participants (i.e., providers) during the three-year contract period. Primary care providers may only participate in one ACO. However, a hospital can participate in more than one ACO, as can non-primary care medical and surgical providers. ACOs must develop policies and programs to improve quality and improve patient care. An ACO, for instance, must develop a process to promote evidence-based medicine, patient engagement and coordination of care. ACOs must have a patient survey tool in place. ACOs must have a process for evaluating the health needs of the population it serves. ACOs must have systems to identify high risk beneficiaries and develop individual care plans for target populations. At least 50 percent of an ACO's primary care physicians must be meaningful EHR users as defined by the HITECH Act and subsequent Medicare regulations. ACOs must meet significant public reporting requirements in a standardized format. CMS may monitor the ACO to ensure they are not avoiding atrisk beneficiaries or distributing unapproved marketing materials (among other things). CMS must approve, for instance, any marketing materials or other communications promoting the ACO. An ACO's shared savings agreement with CMS can be terminated on various grounds (e.g., failure to report quality standards or failure to meet quality thresholds and avoidance of at-risk beneficiaries). There are various decisions which are not subject to appeal by an ACO if it is terminated from the program by CMS. The regulators' policy statement on antitrust laws provides some guidance on how they intend to regulate ACOs. ACOs with two or more participants who have a combined share of 30 percent or less for each common service in a defined geographic area will be declared to be in a “safety zone.” Those in the zone are “highly unlikely to raise significant competitive concerns and the antitrust agencies will not challenge” them absent “extraordinary circumstances.” The ACOs in this safety zone have no obligation to contact the Federal Trade Commission (FTC) or Department of Justice (DOJ). An ACO applicant with a share of 50 percent or more will need to obtain a letter from either the DOJ or the FTC saying the agency does not intend to challenge or recommend a challenge of the ACO. If the DOJ or FTC says it plans to do so, the ACO won’t be eligible for the Medicare program. The regulators will provide an expedited, 90-day review of requests from ACOs that are above the 50 percent standard. For ACOs between 50 percent and 30 percent, a review won’t be required. Such ACOs, however, can seek a review from

Page 21

either DOJ or FTC, and it will still be completed within the expedited 90-day window. In their joint notice, CMS and the OIG propose waivers of the civil monetary penalty, anti-kickback and self-referral laws. It appears that for the self-referral and anti-kickback statutes, the waiver applies only to distributions of shared savings (not any other financial relationships). While the regulations provide some helpful guidance on governance issues that may help prevent the control of ACOs by lay entities, it appears that physicians are not likely to rush to create new accountable care organizations (ACOs) under the proposed regulations issued by CMS. The 429-page CMS proposal imposes more micro-management-rules over ACOs than many expected and requires downside financial risk that was not expected in the shared savings program. The proposed regulations also fail to provide up front flexibility and resources to help solo and small practices join or create ACOs (although there is some indication that CMS will be looking to fund solo-small group practices through the Center for Medicare and Medicaid Innovation).

BUT AREN’T THESE JUST “PROPOSED REGULATIONS?” The “proposed regulations” are not final. CMS Administrator Don Berwick, MD, has emphasized the Administration’s interest in comments to help CMS shape the regulations. Public comments on the ACO regulations are due on June 6, 2011. Also, CMS and the Office of the Inspector General (OIG) issued a joint solicitation of comments on proposed waivers for Medicare ACOs from the self-referral, anti-kickback, and civil monetary penalties statutes. The Federal Trade Commission (FTC) and the Department of Justice (DOJ) issued a proposed policy statement on antitrust and ACOs, and the Internal Revenue Service (IRS) issued a notice pertaining to tax-exempt entities. All these agencies are providing opportunities for the public to comment. The CMA and the Board of Trustee's Technical Advisory Committee on Physician-Hospital Alignments is reviewing the hundreds of pages of documents in-depth and will be working on developing comments based upon the CMA House of Delegates (HOD) adopted ACO principles.

WHAT IS CMA DOING TO HELP? CMA’s overarching goal is to provide the best possible information to help physicians make individual decisions about the best practice arrangement for their professional situation. Some physicians will decide to join ACOs. CMA will provide information to help those physicians negotiate optimal arrangements and change the regulations so that they are optimal for those who choose to participate. Other physicians will choose to form their own non-ACO organizations. CMA will provide information, tools, and models to help physicians establish such organizations. Strategies for Independent Physicians: To assist independent physicians in navigating these uncharted reform waters, CMA and MMCMS have joined with four other county medical societies to bring you a conference called “Strategies for Independent Physicians to Collaborate and Succeed in the Era of Reform.” The conference will provide information on the various business models that can help physicians pool their talents to effectively compete in the new health care marketplace. Topics also will include ways to provide improved quality of care through clinical (See Federal Issues, Page 22)

Spring 2011

Budget (Continued from page 7)

In addition, the Legislature approved increases in Healthy Families premiums and co-payments, as well as an elimination of vision services in that program (total cut of $30 million).

Doesn’t CMA have a Court Case that Blocks Medi-Cal Cuts? The injunction that CMA secured in 2008 blocked the state from implementing the Medi-Cal cuts passed that year. The State has maintained that the injunction does not necessarily block implementation of a new round of cuts. Three years ago, the courts found that the state had not complied with federal rules regarding steps states need to take in order to cut reimbursement rates. The state is now taking steps to comply with these rules in hopes that the federal government will allow these cuts to move forward.

Page 22

In addition, the court case from 2008 is still working through the legal process. The United States Supreme Court recently decided to hear the case. The state is operating under the assumption that they will win that case. What Will Happen Now? There are at least four possible scenarios. The Democrats in the Legislature could decide to approve a majority-vote budget comprised completely of cuts. This would involve deep cuts to education and public safety, as well as additional cuts to health and social services. Second, the Governor could call a special election for November, and then gather signatures to place his tax proposal on the ballot through the initiative process. This would allow the state to assume about half of the expected revenue for the next fiscal year. Thirdly, if four Republican legislators were willing to vote for taxes, and the Governor was willing to go back on his campaign pledge, they could approve the tax extensions without a vote of the people. The final scenario would be that the Legislature (with Republican support) and the Governor would temporarily approve the tax extension only until November when the issue would be put before the voters.

(Continued from page 21)

Additionally, if you would like to view the ACO principles adopted by the CMA House of Delegates in October 2010 go to acoprinciples.

integration, and whether it is feasible to form physician-led networks, including ACOs. At the conference, a comprehensive resource manual will be provided. The May 14th conference is posted at, has been announced in CMA Alert and News Break and has been communicated by MMCMS through mail, fax and e-mail notifications.

MMCMS/CMA’s goal is to help you take charge of your own destiny in these challenging and changing times, particularly related to the health reform legislation and the regulatory changes it is generating. We want to ensure that medical decisions remain in your hands so that you can serve your patients. Please let us know if there is anything more we can do to help you.


Innovation Center: CMA Assistance with the CMS Center for Innovation: CMS indicated in its proposed ACO regulations that the newly-formed Center for Medicare and Medicaid Innovation (“The Innovation Center” or “IC”) will strive to assist small physician practices to develop innovative practice models. The PPACA provided $12 billion in funding to the IC to fund such programs. CMA will be helping physicians obtain funding and approval from the Innovation Center. Webinars: CMA has launched a series of webinars on Accountable Care Organizations, other payment models and the health care reform law in general, to help familiarize physicians with the new law and educate physicians about its impact on their practices. Upcoming webinars will be posted at http:// and announced in CMA Alert. Archived Webinars: If you missed any of our recent webinars, they are available for on-demand viewing at the CMA website. Go to and click on “OnDemand Webinars.” ACO/Payment Model Issue Briefs: CMA has prepared a series of issue briefs on the Accountable Care Organizations and Medical Homes which can be found in CMA’s online resource library at Search “Federal Health Reform Issue Brief” and “Accountable Care Organizations.” Medical-Legal Document: CMA has also prepared medical-legal document #0201, “Legal and Practical Considerations Concerning Accountable Care Organizations.”

The Bulletin 2848 Park Avenue, Suite C â—? Merced, California 95348

Spring 2011