Patient engagement:Your patients’ actions may hold the key to whether

you can achieve meaningful use of electronic health records and receive an incentive payment under Stage 2 rules released last August.

For both Stage 1 and Stage 2, physicians will need to offer patients the ability to view online, download and transmit their health information.

But at least 5 percent of them must actually view, download or transmit the information for the objectives to be achieved in Stage 2. Critics say the measure holds physicians hostage to circumstances over which they have no control.

Access to electronic health informationThe new core objective for Stage 1 becomes effective in 2014.

It will replace the core and menu objectives of providing patients with electronic copies of their health information upon request and timely electronic access to their health information.

For both stages, more than 50 percent of unique patients seen during the electronic health record (EHR) reporting period must have access to the health information within four business days after it is available to the physician. Health information includes lab results, problem list, medication lists and allergies.

“Access” as defined by the Centers for Medicare & Medicaid Services (CMS) can include providing patients with instructions on how to access their health information, the required website address, a unique and registered username or password, and instructions on how to create a login, for example.

There is an exclusion for physicians who do not order or create the health information included in the list (e.g., lab results, problem list, medication lists and allergies, etc.).

Another Stage 2 core objective and measure requires secure electronic messaging between more than 5 percent of patients and the provider.

Patients’ decisions not to access the information may be only one of several barriers. Demographics may be another.

Physicians practicing in areas with large low-income or elderly p o p u l a t i o n s m a y b e a t a disadvantage, as wel l as those practicing in areas with a high non-English-speaking population.

A Pew Internet study published

See Patient engagement on page 3

I n s i d e

I n s i d e

Jan./Feb. 2013➜ Fraud in the office:

Tough times call for tough measures

➜ Physician incentives – Don’t leave money on the table

Key to achieving ‘meaningful use’ goals

A financial and management bulletin to physicians and medical practices from:

100 Second Avenue South, Suite 600, St. Petersburg, Florida 33701 | (727) 821-6161 | www.gsscpa.com

In these tough economic times, physicians need to be more diligent than ever when protecting their practices from fraud and embezzlement.

Unfortunately, the instability of the current economy has created significant financial pressure for some employees. Medical practices are not insulated from the potential threat posed by employees who may be unable to pay their bills or meet the financial needs of their families.

For a fraud or theft event to occur, three things must be present: financial pressure, opportunity and the individu-al’s ability to rationalize their behavior.

How you can protect your practiceThere are several steps a physician business owner can

take to help minimize the risk of loss in their practices.Awareness is the number one key to protecting your

assets. Physicians should be involved in the finances of their business.

By knowing what vendors they use and monitoring daily deposits and cash receipts, physicians are more likely to spot a problem at the inception of an embezzlement scheme. They should listen to their employees when they complain about a spouse’s loss of work, increasing debt obligations or substance abuse issues, because these can be important clues if a problem develops.

A family medical practice recently suffered a loss in excess of $300,000 when the practice’s office manager of more than 10 years embezzled through a variety of schemes. These schemes included:

◆ Opening credit cards in the name of the practice and subsequently paying personal expenses with practice funds

◆ Using a signature stamp to endorse checks made out to the practice manager and then changing the “payee” in the bookkeeping records of the practice

◆ Creating two payroll checks, one manual and one direct deposit, for each pay period and claiming that the payroll company made an error

Unfortunately, the physician in this practice was not aware that his expenses were running 81 percent of revenue, a sure indication that the practice’s overhead was not in line with other medical practices in the same specialty.

Implementing internal controls is another step practices can take to help to reduce the likelihood of a financial loss due to fraud or theft. Internal controls are a system of checks and balances, policies and procedures that, when put into place, can minimize the opportunity for embezzlement.

Some common examples of basic internal controls for medical practices include:

◆ Segregate duties – If possible, the individual opening the mail should not be the person making up the deposit slip.

◆ Minimize access to financial records – In today’s world, technology makes access to financial records

more difficult to detect. However, medical practices can limit access to banking and other financial systems through login and password security.

◆ Have bank statements mailed to the physician’s home address – Physicians should make a habit of reviewing the transactions on their practices’ bank statement, including deposits and payments. They should be critical of unauthorized electronic transactions and checks to vendors in round dollar amounts.

◆ Review canceled checks – It’s important to review both sides of canceled checks. Even if the practice’s bank no longer includes these with statements, most banks have the images available to view online.

◆ Review payroll registers – In most medical practices, the physician is not the individual creating the payroll. Doctors should review all payroll registers to look for multiple payments to the same employee, fictitious employees or unauthorized overtime.

While fraud or embezzlement is more likely to occur in the disbursement cycle, the revenue cycle of a medical practice can also be v u l nerable . R ising co-pays and high-deduct-ible health plans require patients to pay more out of pocket at the t ime of service than ever before. The opportunity is present for medical staff to divert these funds – especially cash.

See Tough times on page 3

Fraud in the office: Tough times call for tough measures

Jan./Feb. 2013 Your Healthy Practice2

Tough times continued from page 2

Patient engagement continued from page 1

in April 2012 found that one in five American adults does not use the Internet.

“Senior citizens, those who prefer to take our interviews in Spanish rather than English, adults with less than a high school education, and those living in households earning less than $30,000 per year are the least likely adults to have Internet access,” the study reported.

In addition, only 54 percent of adults living with disabilities in the United States go online.

Limited Internet access can be a potential problem in rural areas. In acknowledging the problem, CMS has excluded the 5 percent measure for physicians if at least half of patient encounters are in counties where 50 percent or more of housing units do not have 3Mbps broadband available on the first day of the reporting period.

Information on broadband width is available at www.broadbandmap.gov.

Patient acceptanceProponents of increasing electronic

engagement with patients claim the 5 percent threshold is actually quite low, given society’s penchant for electronic devices. About 9 percent of Americans already exchange emails with their doctors, according to a Harris Interactive poll.

Kaiser Permanente reports that more than 63 percent of eligible members use their online health management tools. What’s more, access to the information builds loyalty.

Patients with online access to key components of the Kaiser Permanente electronic health record’s patient portal, My Health Manager, are 2.6 times more likely than nonusers to remain members, according to a study published in The American Journal of Managed Care last July.

The University of Texas MD Anderson Cancer Center also has reported enthusiastic acceptance of their secured, Web-based portal for personal health information, which was launched in May 2009. In the first year, 57 percent of patients – more than 28,000 patients – accessed their personal medical information, test results and records.

Need for 2014 edition of certified technologyBoth of the Stage 2 measures must be met using certified

EHR technology (CEHRT). Capabilities provided by a patient portal, online personal health records (PHR) or any other means of online access would have to be certif ied in

accordance with the Office of the National Coordinator for Health Information Technology requirements.

Many CEHRT vendors already make patient portals available that meet Stage 1 criteria and standards. However, the Stage 2 measure requires some additional capabilities.

These capabilities will be included in the 2014 Edition of CEHRTs. Among other things, the new edition will comply with Web Content Accessibility Guidelines (WCAG) 2.0 Level A.

The guidelines provide the minimum technical standards needed to make content accessible primarily for the disabled.

All participating physicians must upgrade to the 2014 edition come next year – whether they are in Stage 1 or Stage 2 of the incentive program. To allow physicians time to adopt the 2014 edition, CMS reduced the reporting period to three months in 2014. – Irene E. Lombardo

Practices should make a policy to issue a receipt when collecting any funds at the time of service, and the receipt should indicate the payment method. They should beware of patients calling to complain that they paid at the time of service and either didn’t receive a receipt or later received a bill in the mail for their visit.

Practices that provide cosmetic or “cash only” services, which are not covered under insurance, may also be susceptible to misappropriation of funds. It is critical that practices reconcile all deposits per the bank to the payments posted to the billing or practice management system.

All discrepancies should be investigated. This is the single most important step a practice should take, and many fail to do it.

Some experts predict that three out of four physicians will suffer a loss from fraud or embezzlement. Creating an env ironment of awareness within a pract ice and implementing minimal internal controls may be just enough to discourage employees from taking advantage of hard-earned revenue. – Deborah R. Mathis, CPA, CHBC, and Michael S. Lewis, MBA, FACMPE, with CPAmerica member firm Cowan, Gunteski & Co., P.A.

Jan./Feb. 2013 Your Healthy Practice 3

There’s still time for physicians to take advantage of the incentives offered through the Medicare and Medicaid Electronic Health Record Incentive Programs.

Physicians who start this year can earn incentives totaling $39,000 over a four-year period. Those who wait

until next year will leave $15,000 on the table. They will be eligible for only $24,000 in payments.

More t han 120,000 eligible healthcare profes-siona ls have received incentive payments since the Electronic Hea lth

Record (EHR) Incentive Programs began in January 2011. But in case you haven’t been paying attention, the program will soon change from offering a carrot to being a stick. Eligible physicians who do not demonstrate meaningful use this year will face penalties come 2015.

First-time participants have only about 18 months to purchase, install and test a system and train staff. The good news is that the Centers for Medicare & Medicaid Services (CMS) is requiring providers to demonstrate meaningful use only for a three-month EHR reporting period in 2014, regardless of the stage they are in.

That means physicians participating for the first time must begin reporting no later than July 3, 2014, and com-plete their attestations by Oct. 1, 2014, to avoid penalties. If seeking an exception, physicians must apply no later than July 1, 2014, to avoid a payment adjustment in 2015.

Those practices that are just now beginning the journey toward purchase of an EHR system may want to consider purchasing a system that is certified for the 2014 edition of EHR technology. All participating physicians will need to upgrade their EHR systems to the 2014 edition beginning in 2014 to qualify for the program, regardless of which stage of meaningful use they are in at that time. – Irene E. Lombardo

Physician incentives – Don’t leave money on the table

The technical information in this newsletter is necessarily brief. No final conclusion on these topics should be drawn without further review and consultation. Please be advised that, based on current IRS rules and standards, the information contained herein is not intended to be used, nor can it be used, for the avoidance of any tax penalty assessed by the IRS. © 2013 CPAmerica International

Your Healthy Practice

100 Second Avenue South, Suite 600, St. Petersburg, Florida 33701www.gsscpa.com | gss@gsscpa.com

(727) 821-6161

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