5 Legal Considerations with Concierge Medicine
As the Affordable Care Act (ACA) continues to swing into full gear, physicians and patients are both looking for alternatives to the traditional model of care.
Patients want more attention and time from physicians, yet many physicians are struggling to keep their doors open while also maintaining a work-life balance.
Concierge medicine may be one solution as we discussed in the first post in this series last week. In this arrangement, physicians offer services to patients and bill them directly, or they may bill insurers for covered services while collecting a flat fee from patients for other non-covered services. Physicians see fewer patients, but they’re able to spend more time getting to know the unique health needs of those patients. Today, nearly 5% of providers are using this
model with many more considering the option.
Michael D. Miscoe, founding partner of Miscoe Health Law, LLC, says more and more physicians are starting to consider a concierge arrangement in light of the ACA. “Physicians are seeing exchange plans with higher deductibles. Patients are being required to pay more out of pocket. Because some outpatient providers would never be able to justify expenses beyond the patient’s deductible, more are moving toward concierge models,” he says.
Miscoe frequently assists physicians who want to make the transition from the fee-for-service model to a full-fledged concierge practice. He provides insight into the types of legal questions that concierge physicians must address as they make the move. Consider the following common questions that arise:
- Are concierge physicians ever required to bill the insurer? It depends. If the physician is an MD or DO, he or she has the legal right to opt out of Medicare completely, in which case he or she can simply bill Medicare patients directly even when services are covered. No provider is required to bill non-covered services to Medicare. All provider types have the ability to choose not to participate with a commercial insurance plan. Even when providers do participate, most contracts allow them to bill the patient directly for non-covered services. Miscoe says many physicians are moving toward non-covered models of care to avoid the post-payment risk associated with billing of covered services.“Docs are saying it’s not worth it. When you go through an audit, you go through what’s now a three-year appeal process,” he says, adding that he’s currently waiting for a decision on an Administrative Law Judge hearing that took place nine months ago.For physicians and other providers who can’t opt out (e.g., nurse practitioners, podiatrists, chiropractors, therapists, physical therapists, and others) or those who haven’t opted out, there is a legal obligation to bill for covered services, says Miscoe.This is where it gets complicated. An evaluation and management (E/M) service, for example, is covered under Medicare. However, if the E/M service isn’t medically necessary, then it’s not a covered service. Consider a physician who performs an E/M service for the purpose of preparing a patient for a cosmetic Botox injection. This is not a covered E/M service, thus the provider has no obligation to bill the service to Medicare with an appropriate Advanced Beneficiary Notice (ABN) and can bill the patient directly, explains Miscoe.Other examples of non-covered services include weekly maintenance care for physical therapy or chiropractic services, certain routine foot care, certain ongoing wellness and prevention services, and a whole slew of others.“The best way to avoid billing Medicare is to not provide a covered service,” says Miscoe. “If you go through all of the publications and LCDs, you can come up with a million ways as to why a service isn’t covered.”Chiropractors run into non-covered services all the time, he says. For example, manipulation is covered if considered and documented to be restorative care, but maintenance manipulation is not. “Additionally, Chiropractors can treat patients with a wide variety of techniques that don’t constitute manipulation, depending on how it’s defined in a particular state,” he adds.Medicare auditors often impose strict conformance with their interpretation of documentation content guidance as a proxy for determining whether services are necessary, says Miscoe. He recalls one instance in which a provider documented a mechanism of trauma, as instructed in the guidance; however, the auditor denied the care because the trauma was due to an everyday activity.
“This is the kind of ridiculous audit results commonly seen that trigger an expensive and time-consuming appeal process. 100% error rates are not unusual for that reason” he says. Miscoe continued by stating that where providers apply these same post-payment audit standards, it is easy for them to conclude that care isn’t covered.
- Must concierge physicians provide Advanced Beneficiary Notices (ABN)? There’s no requirement to provide an ABN for non-covered services, says Miscoe, except for cases in which the basis for non-coverage is due to a lack of medical necessity. He advises concierge practices to ask patients to sign a document stating that they understand that the services are non-covered and that they will not be billed to Medicare. When non-coverage is based on medical necessity, an ABN is technically required.
- Should concierge physicians assign CPT and ICD-9-CM codes if they don’t bill insurers? Miscoe advises against the assignment of these codes. “Using these codes suggests that you’re doing a particular service, and in some cases, it can imply that the service was necessary” he says, adding that he has seen cases in which use of a particular code to record the encounter was scrutinized for its accuracy during a licensure board investigation even though the code was not billed to any third party. Instead, he suggests that cash only practices develop internal codes for tracking.
- If a concierge physician isn’t billing insurers, must he or she continue to maintain detailed documentation? The only requirement for these physicians is to adhere to rules set forth by their licensure boards, says Miscoe. However, these rules are often vague and very loose. Miscoe says all providers should maintain detailed documentation regardless of whether it’s required by an insurer or other entity.“I worry about malpractice liability more than compliance with licensure board standards,” he says. “You need to be able to justify what you’re doing any why so if there’s an adverse effect, you have something to rely on. But you don’t need to adhere to a strict LCD documentation content standard. In fact, the more you deviate from that standard, the more you can justify why your service would be considered non-covered by Medicare or a commercial carrier.”
- Must concierge physicians abide by HIPAA? Those who transition to a care model that doesn’t require submission of claims to Medicare and other carriers may not be subject to the Privacy and Security provisions of HIPAA to the extent that they don’t meet the definition of a covered entity under the law. Essentially, they don’t engage in electronic transactions (e.g. electronic claims, benefit verifications, or receive electronic an remittance advice), explains Miscoe. However, these physicians must continue to abide by state laws and common law restrictions pertaining to privacy and confidentiality.
For more information on legal issues with concierge medicine, review “Concierge Medicine: Legal Issues, Ethical Dilemmas, and Policy Challenges,” originally published in the Journal of Health & Life Sciences Law. The American Medical Association also provides guidelines regarding retainer practices.
Any physicians interested in the concierge model should definitely consult with a healthcare attorney familiar with these issues throughout the transition process to ensure that all legal obligations are met.