Washington State Orthopaedic Association
Newsletter
In This Issue
The Changing Face of Orthopaedic Employment
Important Information on the Timely Claims Filing Requirement
Electronic Dues Renewal
In Memoriam
Supplier Sponsorships
WSOA Leadership
John Adkison MD
President  &
AAOS Councilor

Lyle Sorensen MD
First Vice President

Patrick J. Halpin MD
Second Vice President, AAOS Councilor

Brian Wicks MD
Secretary/Treasurer

Walter F. Krengel MD
Immediate Past President

Robert Yancey MD
Director

Chris Kontogianis MD
Director

Tom Degan MD
 Director

Michael Thorpe, MD
Director

Doug Musgrave, MD
Director

Ash Patel, MD
Director

Robert Winquist, MD
Director

Alan Greenwald, MD
Director

Pat Lynch, MD
Director
WSOA Board Meeting
Residents
Did you know your WSOA membership is complimentary? 
You'll receive complimentary registration to all WSOA CME/Annual meetings. 
 Call our office for more information 206-956-3642


WSOA Offices
2033 6th Ave
Suite 1100
Seattle, WA 98121
(206) 956-3642
Fax: (206) 441-5863

Association Executive,
Marshall Turner
Email:
ddw@wsma.org


January 2011
The Changing Face of Orthopaedic Employment

By Jennifer M. Anderson; Mark S. Thomas; and Leslie R. Jebson

Factors driving the hospital and physician connection
Each generation of physicians has different motivators, drivers, and expectations. Many younger physicians-including orthopaedic surgeons-want to work fewer hours and expect greater flexibility in employment opportunities to match their personal priorities. This new generation of physicians may account for the large number of orthopaedic surgeons seeking hospital employment. In addition, many orthopaedists currently in private practice are exploring employment opportunities within hospitals and healthcare systems.

Recent surveys indicate that physicians are not happy in their current positions. According to the Physicians' Perspective: Medical Practice in 2008, 6 out of every 10 doctors interviewed said that they would not recommend medicine as a career, in part due to the increasing demands on their time, resources, and energy.

Advantages to employment
Whether the shift is by choice or through necessity, healthcare systems are rapidly adding physicians from a wide range of specialties-including orthopaedic surgery-to their payrolls. A recent survey conducted by Merritt Hawkins, a physician search firm, found hospitals typically earn 5 to 10 times more in revenues from employed physicians than what they pay them in salaries. Employed orthopaedic surgeons bring in an average of $2.11 million in revenue and may improve a hospital's market position. Healthcare systems can realize additional benefits from integrating their services with orthopaedic specialists.

According to the Medical Group Management Association's Medical Directorship and On-Call Compensation Survey 2010 Report, orthopaedic physicians commanded the third highest average daily on-call compensation rates ($958), behind neurologic surgery and general surgery specialties. Hospital employment of orthopaedic surgeons means that hospitals will no longer have to pay independent orthopaedists for being on-call; instead, payment is integrated in the overall compensation package for employment.

Healthcare systems can potentially create cost-efficiencies among billing departments for various specialties by using bundled fees, which include both facility and physician fees. Perhaps most importantly, the hospital-physician relationship has the potential to improve quality and efficiency by providing cost-efficient, better coordinated care.

If structured properly, integration and alignment between physician and hospital can create a more flawless exchange of information, improve access, and provide the opportunity to focus more on the delivery of care to patients.

Furthermore, quality assurance programs can be used to potentially improve the infrastructure of the hospital.

Legal, regulatory factors
Multiple legal and regulatory factors are also driving hospital employment of orthopaedic physicians, including economic credentialing, regulatory safe harbors, billing for ancillary services, and joint ventures. Hospitals that impose financial conditions upon employed physicians have significantly less anti-trust liability than those that use economic credentialing on nonemployed medical staff. The statutory and regulatory "safe harbor" for employed physicians also shields hospitals and physicians from liability under federal and state anti-kickback and self-referral prohibitions.

The employment safe harbor has comparatively fewer criteria than other safe harbors, making it particularly attractive and attainable. Additionally, the burdensome requirements that apply to physicians and physician group practices under the self-referral prohibitions do not apply to hospital-employed physicians. Recent amendments to self-referral regulations greatly limit "under arrangements" joint ventures between physicians and hospitals, particularly arrangements paid for on a by-encounter basis (so called "per click" contracts).

Déjà vu all over again
Ventures between physicians and healthcare systems are not new; in fact, many physicians may have a sense of déjà vu. In the 1990s, with the start of managed care, hospitals and healthcare systems began aggressively seeking primary care physicians. The difference today is that hospitals are now seeking medical specialists.

Hospitals and healthcare systems have also learned from the past. For example, many no longer  compensate an employed physician based on value alone, but allow incentives to be applied for productivity, leadership, quality, and more. Often, compensation agreements are made based on formulas that consider work relative value units. More incentive plans, however, are including quality and outcome measures of a physician's work.

Although physicians and hospitals or healthcare systems may see benefits from moving to an employment-based model, employing orthopaedic specialists has some risk, primarily financial. If the  orthopaedist is not as productive as anticipated, the healthcare system may lose money on the venture.

Before agreeing to employment, orthopaedists must take several factors into consideration, including compensation and the impact on autonomy. Compensation paid to employed orthopaedists must be consistent with fair market standards; this type of limitation would not be faced within private care. Additionally, employed orthopaedists may still retain autonomy over their direct clinical activities; however, they may lose control over clerical activities such as the work environment, staffing, and coworker selection. Numerous stipulations, including clauses regarding noncompete and buy-in options, must also be reviewed and understood before making a decision. Medical liability is another issue. Employment shifts the primary liability for medical malpractice from the physician to the hospital, which is favorable for the physician, but not so for the hospital. The law considers employed physicians to be more in the control of the employer than nonemployed medical staff. Therefore, the system is more responsible for the quality of care provided by employed physicians and may be more subject to be named in a lawsuit for medical malpractice of an employed physician.

Many factors are driving the current rise in physician employment within orthopaedics: physicians who want a more predictable work-life balance, flat physician incomes due to high practice costs and declining reimbursements, and hospitals realizing the financial and quality potentials of employment. Hospitals will potentially see increased volumes, higher revenues, eased regulatory burdens, and higher overall job satisfaction of the medical staff.

Orthopaedics has changed over the past several years and will continue to do so, leading to more employment opportunities in the near future.

Reminder:  Important Information on the Timely Claims Filing Requirement

The Centers for Medicare & Medicaid Services would like to remind Medicare Fee-For-Service physicians, providers, and suppliers submitting claims to Medicare for payment that, as a result of the Patient Protection and Affordable Care Act (PPACA), effective immediately, all claims for services furnished on or after Jan 1, 2010, MUST be filed with your Medicare contractor no later than one calendar year (12 months) from the date of service - or Medicare will deny those claims.

 

If you have Medicare Fee-For-Service claims with service dates from Thu Oct 1, 2009, through Thu Dec 31, 2009, those claims MUST be filed by Fri Dec 31, 2010, or Medicare will deny those claims. Claims with service dates from Thu Jan 1, 2009, to Thu Oct 1, 2009, keep their original Fri Dec 31, 2010 deadline for filing.

 

For claims for services that require reporting a line item date of service, the line item date will be used to determine the date of service.  For other claims, the claim statement's "From" date is used to determine the date of service.

 

For additional information about the new maximum period for claims submission filing dates, contact your Medicare contractor or review the following MLN Matters articles related to this subject:

§  MM6960 - "Systems Changes Necessary to Implement the Patient Protection and Affordable Care Act (PPACA) Section 6404 - Maximum Period for Submission of Medicare Claims Reduced to Not More Than 12 Months" - http://www.cms.gov/MLNMattersArticles/downloads/MM6960.pdf

§  MM7080 - "Timely Claims Filing: Additional Instructions" - http://www.cms.gov/MLNMattersArticles/downloads/MM7080.pdf

 

A podcast on this subject is also available at http://www.cms.gov/CMSFeeds/02_listofpodcasts.asp

Electronic Dues Renewal
The WSOA 2011 Dues Renewal was sent out electronically for 2011.  If you require special billing needs, please contact our office at 206-956-3642. Remember, you can renew your 2011 dues online.

In Memoriam
Please forward information regarding the passing of any WSOA members to Darla White at ddw@wsma.org so that we may share the information with your fellow colleagues.
CONTRIBUTE TO THE WSOA NEWSLETTER
If you'd like to contribute to the WSOA Newsletter, please contact Darla White at 206-956-3642 or email your submission to ddw@wsma.org.
Supplier Sponsorships Available
As an ongoing effort to offer our members value added benefits, the WSOA is in the process of creating an on-line directory of medical suppliers.  We will also be offering sponsorship opportunities in our monthly newsletter.  Each monthly sponsor will receive article space to draw attention to their goods or services.   Please feel free to pass this information on to suppliers you think might have an interest in this opportunity.  For information contact Darla White at 206-956-3642 or email at ddw@wsma.org
Contact Information
The WSOA feels it is critical to be able to keep its members up to date on important issues affecting your practice and patient care. Please be sure your contact information is current with our office. You may email contact information updates to Darla White, WSOA Association Executive at ddw@WSMA.org.
Physicians Assistants Join WSOA today!
The WSOA Board of Directors has approved the membership of physician assistants in the WSOA.  Please encourage your PA staff members to join.  Go to www.wsoa.org and download the application.  Fax completed applications to 206-441-5863 or mail to WSOA, 2033 6th Ave. Suite 1100, Seattle, WA 98121