MAY/JUNE2010

Volume 40, No. 3

ESCAMBIA COUNTY MEDICAL SOCIETY

President’s MessageGood MedicineBy Wayne Willis, MD

Dr. Wayne Willis

CME EventTuesday | June 8

Verona’s6:00 pm

Dinner|Speaker

Update on Strategies in Pertussis Prevention

and Current topics in Vaccine Advocacy

RSVP478-0706

ECMSinfo@bellsouth.net

Founded in 1873

continued on page 7

I want to thank all of you who have supported our county medical society through your membership as well as your presence at our ECMS meetings. Medicine today, like all other aspects of our lives is being shaped by the growth of digital information. With email, cell phones and Face Book we commu-nicate faster but without the emotion that is commu-nicated with eye contact, facial expression and the spoken word. Taking time every few months to meet and speak with fellow colleagues reminds us that we belong to the greatest profession in the world. Good food and fellowship is one way to unwind from the bureaucratic burdens of things like Red Book Rules, sustainable growth rate (SGR) and scope of practice issues.

Recent MeetingsInformation Technology Our May meeting was at the Pensacola Yacht Club. We had a number of sponsors that included companies such as Whitney Bank, FPIC, Regions Bank, Landrum, MAG Mutual Insurance, Physicians Weight Loss, Covenant Hospice, Emerald Coast Hos-pice, and The Pathology Group of Northwest Florida. Our speaker, Danny Green, from the Studer Group gave a few pointers on communication skills and had everyone laughing with some group participation drills . At our April meeting we heard from two speak-ers. The first was Dr. Hugh Nguyen, CEO and Presi-dent of Cogon, who spoke about the role his company is playing in coordinating health information technolo-gy across health care systems that use different elec-tronic medical records (EMR). He makes an analogy between information technology (IT) and electricity. He believes that medical IT, like electricity, will have to be regulated as a public utility so that it is available to all who need it at a reasonable cost. Just like electric-ity can be generated in different ways, the final result still flows through a regulated utility. Because this is not yet available, doctors with VA patients and EMR’s are unable to communicate with the VA system EMR and tests are often duplicated or not available. The second speaker at our April ECMS meeting was Dr. Peter Andersen who spoke on the PCMH- Patient Centered Medical Home. It was his opinion that just as outpatient medicine has transitioned from house calls to traditional office visits due to chang-ing technology after WWII, the current system will be

replaced by team care. Before the meeting, he told me that his adoption of the EMR in 2004 “just about broke my back”. He went on to say that he was spending more time entering data than an-alyzing and treating his patients. He now employs nurses that he has trained to take much of the history and then finish entering the data and instructing the patient after he has done the exam and given instruc-tions to his nurse. As a primary care physician (PCP), he feels that this has allowed him to see more pa-tients with more time on diagnosing and treating and less time on data entry. He does not use physician assistants or nurse practitioners but trains registered nurses to do the history taking and data entry. He be-lieves that this is the most effective way to use the EMR. As outpatient medicine moves from urgent care issues in the doctor’s office ( more and more we will see these problems treated by midlevels in retail clin-ics) and more emphasis placed on preventive health care and chronic disease management, the need for team care will increase. We will continue to look for good speakers who can provide continuing medical education (CME) along with good food and new venues. We have a special CME program at Verona’s June 8, 2010 on Pertussis and Vaccinations in Legislation.

FUTURE HEALTHCARE TRENDS I recently finished a book review, Innovators Pre-scription by Harvard Business School professor, Clay-ton Christensen. He makes some interesting predic-tions that will force the cost of healthcare down. To begin with, Prof. Christensen believes that rising US healthcare costs are fueled by a runaway train called “fee for service.” The debate to reform healthcare will never move forward until we change to a fixed fee formula. This will not happen by government man-date, but by physician innovations in technology and new business models. When these are coupled with HSA’s and high deductible insurance, cost will fall He believes that large companies like IBM are already moving toward ownership of salaried physicians and direct contracting with hospitals. He refers to these new business models as IFF- Integrated Fixed Fee

For more information, contact Shelly Hakes, Director of Society Relations at (800) 741-3742, Ext. 3294.

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www.firstprofessionals.com

Endorsed by

Escambia B-W 3.5x10.indd 1 1/8/10 12:08:25 PM

ECMS BulletinThe Bulletin is a publication for and by the members of the Escambia County Medical Society. The Bulletin publishes six times a year: Jan/ Feb, Mar/Apr, May/Jun, Jul/Aug, Sept/Oct, Nov/Dec. We will consider for publication articles relating to medical science, photos, book reviews, memorials, medical/legal articles, and practice management.

EditorsNorman Vickers, MD

Holly Strickland, Executive Director

AD PLACEMENTContact Holly Strickland 478-0706

Ad RatesFull page: $600 • ½ page: $300 • ¼ page: $150

2010 ECMS OfficersPresident

Wayne Willis, MDPresident-Elect

Michelle Brandhorst, MDVice President

George Smith, MDSecretary /Treasurer

Wendy Wozniak, MD

Page 4 Taxes and Credits in the Health System Reform Law

Page 7 Membership Directory Correction Stickers

Pages 9-12 Vendors of Choice

Vision for the Bulletin:-Appeal to the family of medicine in Escambia and Santa Rosa County and to the world beyond.- Collaborate with the Alliance to bring together Escambia and Santa Rosa County medical families. To know the needs of the community and promote the healthcare needs.- A powerful instrument to attract and induct members to organized medicine. Views and opinions expressed in the Bulletin are those of the authors and are not necessarily those of the directors, staff or advertisers.

Membership

Member Benefit Highlight

Welcome New Members!Shadi Oweis, M.D.Medical School: Damascus University School of Medicine, 1995

Residency: Mercy Hospital of Toledo

Board Certified: Nephrology and Emergency Medicine

www.medicalcenterclinic.com

Nephrology Associates of the Gulf Coast

8333 North Davis Hwy.

2nd Floor Medical Center Clinic

Phone: 474-8121 | Fax: 969-2880

Donald Denby, M.D.Medical School: Texas Technical University of Health and Science, 1999

Residency: University of Missouri, 2002

Board Certified: Internal Medicine and Gastroenterology

www.medicalcenterclinic.com

Medical Center Clinic Department

of Gastroenterology

8333 North Davis Hwy

Phone: 474-8428 | Fax: 969-2906

North Davis, M.D.Medical School: University of North Carolina at Chapel Hill School of

Medicine, 1996

Residency: Wake Forest School of Medicine, 2000

Board Certified: Anatomic & Clinical Pathology

The Pathology & Laboratory Group of Northwest Florida

4724 North Davis Hwy.

www.pathology-group.com

Phone: 4381154 | Fax: 433-6034

ECMS would like to highlight our newest benefit. We now have electronic weekly updates for Medical Society news. If

you are not receiving the electronic updates weekly, please let me know

478-0706.

In this issue, we have included correction stickers for your pictorial

directory. These stickers can be placed over the incorrect information.

Please call if you would like additional directories.

Florida Medical Association new benefit: The FMA recently launched its new Green Doctor Office Program

(GDOP) at MyGreenDoctor.org. The GDOP is an easy-to-use, free pro-

gram that guides doctors’ offices through creating a Green Team and

making changes that can save their practices money by using energy,

water, and other materials more efficiently. The program offers more than

a hundred Action Steps that offices can take. There are seven workbooks

that walk you through topics that include energy and water efficiency,

solid waste and recycling, chemicals in the workplace, pharmaceuticals

disposal, landscape management, renewable energy, and healthy foods.

A big part of the program is sharing ideas with the office staff, families and

patients; in this way, important improvements are possible for the health

of the community. In just a few months, a practice can qualify to receive a

GDOP Certificate from the FMA.

The program was written by FMA member Todd L. Sack, MD, and

Sarah A. Boren, experts in office environmental issues and is adminis-

tered by the FMA Environment & Health Section. There is no fee for using

the program. To register for the GDOP or to learn more about the pro-

gram, go to MyGreenDoctor.org. The “Quick Start Now” shows you how

to get started today.

The following physicians have corrected information.

Please use the Directory Correction stickers on page 7.

Paula Pyle, M.D. 975 Royce Street

Pensacola, FL 32503

Phone: 332-7760

Fax: 479-6695

Andres Candela, M.D.Wendy Mooreland, M.D.North Davis, M.D.Charles Burns, M.D.The Pathology & Laboratory Group of Northwest Florida

4724 North Davis Hwy

Pensacola, FL 32503

Phone: 438-1154

Fax: 433-6034

David Bernstien, M.D.The Woodlands Medical Specialist, PA

4725 North Davis Hwy.

Phone: 696-4000

Fax: 444-7057

James Patrinely, M.D.Plastic Eye Surgery Association

17 E Main Street, Ste 100

Pensacola, FL 32502

Phone: 473-0990

Fax: 473-0790

Practice Management

Taxes and Credits in the Health System Reform Law

The Patient Protection and Affordable Care Act, as amended by the

Health Care and Education Reconciliation Act of 2010, is paid for through

taxes and fees on the health care sector and employers, as well as through

additional taxes on upper-income individuals. These and other tax changes,

including tax credits for small business owners, will affect physicians as em-

ployers and as individual taxpayers. Below is a snapshot of key provisions in

the new law that may affect physicians and their practices.

Provisions affecting the health care sector

• 40 percent excise tax (“Cadillac” tax) on high-cost health plans—Be-

ginning in 2018, an excise tax will be imposed on the coverage provider

(i.e., insurer, plan administrator or employer depending on the type of cover-

age) of high-cost employer-sponsored health plans with aggregate values

exceeding $10,200 for individual coverage and $27,500 for family cover-

age. The tax is equal to 40 percent of the value of the plan that exceeds

these threshold amounts. For insured plans, the coverage provider will be

the health insurance issuer; for self-insured plans, the coverage provider

will generally be the plan administrator. Employers that make contributions

to a health savings account (HSA) or medical savings account (MSA) must

pay the excise tax if those contributions exceed the thresholds. The tax is

not imposed on the individual enrollee. The dollar thresholds are indexed to

inflation.

• Annual fee on health insurance providers—Beginning in 2014, a fee

will be applied on net premiums of all health insurers based on their market

share. For non-profit insurers, only 50 percent of net premiums will be taken

into account in calculating the fee. Exemptions are granted for: non-profit

plans that receive more than 80 percent of their income from government

programs targeting low-income or elderly populations, or people with dis-

abilities; voluntary employees’ beneficiary associations (VEBAs) not estab-

lished by an employer; certain nonprofit insurers with medical loss ratios

within specific limits; and self-insured plans and federal, state or other gov-

ernment entities. (The fee does apply to companies that underwrite gov-

ernment-funded insurance, such as Medicaid managed care plans and the

Federal Employee Health Benefits Program.)

• Annual fee on pharmaceutical companies and medical device man-

ufacturers—New annual fees on certain manufacturers and importers of

branded prescription drugs (including biological products, but excluding

orphan drugs) would be imposed beginning in 2011 based on annual sales

and set to reach a certain revenue target each year. Beginning in 2013, an

annual excise tax of 2.3 percent will also be imposed on the sale of Class I

medical devices by manufacturers, producers or importers. Class I includes

the vast majority of orthotics and prosthetics, as well as durable medical

equipment. Exemptions are provided for eyeglasses, contact lenses, hear-

ing aids and any device that is generally purchased at retail for individual

use.

• Excise tax on indoor tanning services—Effective July 1, 2010, an excise

tax of 10 percent will be imposed on the amount paid for indoor tanning

services.

Provisions affecting employers

Employer penalties and subsidies

• Penalties on larger employers—Employers with more than 50 full-time

employees that do not offer coverage and have at least one full-time employ-

ee who obtains coverage through an exchange and qualifies for an individ-

ual premium tax credit or cost-sharing subsidy (e.g., individuals with income

between 100 percent and 400 percent of the federal poverty level; the pov-

erty level in 2010 is $18,310 for a family of three) will be assessed penalties

beginning in 2014. The penalty amounts to $2,000 multiplied by the number

of full-time employees in excess of 30. If an employer offers coverage but

has at least one employee who is entitled to a premium tax credit because

the employer’s plan is too costly, the penalty is $3,000 for each employee

receiving a credit or $2,000 for each full-time employee, whichever is less.

Employers of 50 or less, which include the vast majority of physician

practices, are exempt from the requirement to provide coverage.

• Subsidies for small businesses—Small business tax credits will be avail-

able to employers with 25 or fewer employees with average annual wages

below $50,000 if they purchase health insurance for their employees. (This

tax credit is separate and distinct from the individual tax credit that low-

income individuals may be eligible to receive if they purchase insurance

through an exchange.) For tax years 2010 through 2013, the tax credit can

be up to 35 percent of the employer’s contribution toward the premium, pro-

vided the employer contributes at least 50 percent of the total premium cost.

The full 35 percent credit will be available to employers of 10 or less with av-

erage annual wages below $25,000. The credit phases out as firm size and

average wage increase. In tax years 2014 and later, for eligible small busi-

nesses purchasing coverage through the state exchanges, the tax credit

increases to 50 percent of the employer’s contribution toward the premium,

provided it is at least 50 percent of the total premium cost. The credit will be

available for two years. The full credit will be available to employers of 10 or

fewer with average annual wages of less than $25,000. According to the

IRS, the wages and hours of physician business owners and partners

will not be counted in calculating either the number of full-time employ-

ees or the average annual wages.

Limitations on employer deductions

• Expenses allocable to Medicare Part D subsidy—Effective 2013, em-

ployers that currently sponsor retiree prescription drug plans will no longer

be able to deduct amounts contributed to them. However, future Medicare

Part D subsidies will continue to be tax-free to the employer.

• Limitation on excessive health insurance company compensation—

Effective 2013, the deduction for executive and employee compensation for

health insurance providers is limited to $500,000 per applicable individual.

The limit applies to all officers, employees, directors and other workers.

Provisions affecting individuals

• Tax penalties for failure to obtain health insurance coverage—Indi-

viduals must obtain minimum essential coverage for themselves and their

dependents, effective 2014, with certain exemptions (i.e., hardship, religious

reasons). Those without coverage will pay a tax penalty of the greater of

$695 per year up to a maximum of three times that amount ($2,085) per

family, or 2.5 percent of household income. The penalty will be phased in

according to the following schedule: $95 in 2014, $325 in 2015, and $695 in

2016 for the flat fee; or 1.0 percent of taxable income in 2014, 2.0 percent in

2015, and 2.5 percent in 2016.

continued on next page

Practice Management

• Medicare payroll tax—Effective 2013, the hospital insurance (Medicare

Part A) payroll tax will increase by 0.9 percent on high-income workers earn-

ing more than $200,000 and joint filers earning more than $250,000. In addi-

tion, a 3.8 percent Medicare tax will be imposed on net investment income

from interest, dividends, annuities, royalties, rents and taxable net gain for

these same individuals. This tax is not indexed for inflation.

• Itemized deductions for medical expenses—Effective 2013, the thresh-

old for claiming the itemized tax deduction for unreimbursed medical ex-

penses will increase from 7.5 percent to 10 percent for taxpayers under 65.

The increased threshold applies to individuals 65 years and older in 2017.

• Flexible savings accounts (FSAs)—Effective 2013, contributions to FSAs

are capped at $2,500.

• HSAs—Effective 2011, the tax on dis-

tributions from an HSA or Archer MSA

that are not used for qualified medical

expenses is raised to 20 percent. Also ef-

fective 2011, the cost of over-the-counter

medicines may not be reimbursed through an FSA, HSA, Archer MSA, or

Health Reimbursement Arrangements, unless obtained with a prescription.

• Health professionals state loan repayment tax relief—Payments made

under any state loan repayment or loan forgiveness program that is intended

to provide for the increased availability of health care services in underserved

or health professional shortage areas will be excluded from gross income.

Health Information Technology UpdateBy Bob Hoyt MD Many changes in health information technology occurred following the

passage of the American Recovery and Investment Act (ARRA) of 2009.

Unfortunately, many of these changes are still a work-in-progress so that

frequent updates are required. Health and Human Services provides further

information on their web site.1 The following are three important updates for

clinicians:

Meaningful Use (MU). In order for physicians and hospitals to be re-

imbursed for electronic health record (EHR) use by Medicare or Medicaid

they must be eligible for payment, use a certified EHR and demonstrate

“meaningful use”. The latter term was defined in a Notice of Proposed Rule

Making (NPRM) published in January 2010 that included 25 objectives and

reporting criteria for stage 1 meaningful use. Stage 1 would cover the years

2011-2012. The NPRM was then open to public comment for 60 days and

is now closed. At this time meaningful use is being discussed intently by

committees of the Office of the National Coordinator for Health Information

Technology (ONC) and we anticipate recommendations forwarded to the

Secretary of Health and Human Services in the June 2010 time frame.

From almost every corner of healthcare such as the American Hospi-

tal Association and the American Medical Association there have been re-

quests to scale down the number of MU criteria and delay the progression

to stages 2 and 3. This is due to the fact that most commercial EHRs are not

ready for meaningful use and the government is not ready to receive and

analyze electronic reports. Most experts predict we will see a much shorter

and less complex list of MU criteria for physicians and hospitals. A web

site has been created by the Association of Medical Directors of Informa-

tion Systems to discuss the myriad controversies and opinions surrounding

MU.2

Certified EHRs. EHRs will have to be certified by an organization that

they are capable of achieving meaningful use in order to qualify for reim-

bursement. In January 2010 the technical standards were published for

EHR certification. In March 2010 ONC published a Notice for temporary

(fast ramp up of EHR certification) and permanent certification. Supervi-

sion of permanent certification organizations will be by the National Institute

of Standards and Technology.3 Thus far, the only certifying body for EHRs

has been the Certification Commission for Health Information Technology

(CCHIT), but other organizations have now applied. CCHIT has certified

20 EHR vendors for 2011 but because final MU criteria are pending, EHRs

are currently listed as simply meeting or exceeding government require-

ments.4

Regional Extension Centers (RECs). ARRA established and funded

($642 million) sixty regional extension centers with the sole purpose of pro-

moting health information technology, particularly EHR use by rural primary

care physicians. Their goal is to reach 100,000 physicians in the next two

years. They will provide technical assistance, workflow redesign and best

practices information to medical practices that request it. Four RECs will

cover the state of Florida and the REC for Escambia County and most coun-

ties across northern Florida is Community Health Centers Alliance, Inc., lo-

cated in St. Petersburg.5 The REC is known as the Rural and North Florida

Regional Extension Center and will provide assistance to 39 Florida coun-

ties. Escambia County is in region 1, along with Santa Rosa, Okaloosa and

Walton counties and the local coordinator is Northwest Florida RHIO. RECs

are supposed to partner with community colleges and universities to pro-

vide the necessary education and training for workers in this new field. The

RECs will be funded with decreasing financial support over four years; after

that they must be self-sustaining. ARRA also funded a Health Information

Technology Research Center that will collect information from the RECs to

determine “lessons learned”. It seems unlikely that most RECs will be fully

functional in mid-2010 as planned by ONC.

1 Department of Health and Human Services HIT www.healthit.hhs.gov2 Meaningful Use www.meaningfuluse.org 3 National Institute of Standards and Technology http://healthcare.nist.gov 4 Certification Commission for HIT www.cchit.org 5 Community Health Centers Alliance, Inc. http://www.chcalliance.org

In The Community

Hospital News

Alliance NewsDear Alliance Members:

On behalf of the Pensacola Junior College Foundation and its Board

of Governors, thank you! Your support of the college and its students

through our scholarship programs is greatly appreciated. The EMCS Alli-

ance Endowment scholarship grants two scholarships per year to Nursing

Students to help offset the cost of tuition and fees. These scholarships are

then matched through the PJC Foundation to give the recipients a greater

contribution to their education.

We recently heard from one of the students that were selected for the

scholarship program in 2010.

Donna writes: Please extend my sincere thanks to the Medical Alli-

ance. I can not find the words to convey how much I appreciate the award

that is helping me to continue my nursing education.

“I can no other answer make, but thanks and thanks,” Shakespeare

was quoted in the 1600’s and the words still exemplify a resounding “thank

you” and a “heartfelt appreciation.” Your award truly made a difference in

my life.

When I get my education complete and debt under control… I promise to

return and share the assistance to someone and extend the kindness and

generosity that you have shared with me… Thank you very much!

My Sincere Thanks.

Respectfully.

Please continue to support the Alliance as we work each year to

make difference in our community! See our Crib Flyer inside this newsletter.

West Florida Hospital Earns “Advanced Primary Stroke Center” Designation West Florida Hospital has earned the Gold Seal of Approval™ from

The Joint Commission as an Advanced Primary Stroke Center follow-

ing a comprehensive on-site review in March. The Joint Commission’s

Primary Stroke Center Certification is based upon recommendations for

primary stroke centers published by the Brain Attack Coalition and the

American Stroke Association’s statements/guidelines for stroke care. The

Joint Commission launched the program—the nation’s first—in 2003. Pro-

grams applying for advanced certification must meet the requirements

for Disease-Specific Care Certification plus additional, clinically-specific

requirements and expectations.

Baptist Health Care Embarks Upon Construction Projects on Two Campuses Steadfast in its Mission of caring, Baptist Health Care is embarking

on two major campus renovation and expansion projects in 2010. Baptist

Hospital Campus’ $24 million project is scheduled to begin in June and

Gulf Breeze Hospital’s $5 million project began in April.

Baptist Hospital’s construction plans marry the nearly 60-year history

of the campus with modern, upgrades including: an expansive two-story

addition to encompass spacious family waiting rooms, new emergency

room areas and expanded operating rooms to support Baptist Hospital

physicians and services. In addition, Baptist Bistro, public restrooms,

corridors on the ground and first floors as well as numerous parking up-

grades are part of the project.

Gulf Breeze Campus’ project includes two phases. The first phase is

completing two shelled rooms in the current ICU, increasing the number

of ICU suites to eight. The second phase is constructing a 10,000-square-

foot annex to feature a 1,200-square-foot inpatient physical therapy gym

and 10 new private patient rooms and family waiting area. When com-

plete, these phases will increase Gulf Breeze Hospital’s total number of

inpatient beds from 65 to 77.

For more information and updates on construction plans at Baptist Hos-

pital, visit www.eBaptistHealthCare.org/Construction call 850.469.2319.

Sacred Heart Hospital News Sacred Heart Hospital in Pensacola has received the HealthGrades®

Bariatric Surgery Excellence Award™ for two years in a row (2009/2010

and 2010/2011). Sacred Heart also received the HealthGrades Stroke

Care Excellence Award™ for the second consecutive year (2009, 2010).

The HealthGrades awards rank Sacred Heart’s Regional Stroke Cen-

ter in the top 10 percent in the nation, and Sacred Heart Surgical Weight

Loss Center is ranked in the top 5 percent of bariatric surgery programs

nationwide. HealthGrades also rates Sacred Heart’s bariatric surgery cen-

ter as Best in the Pensacola-Tallahassee Region.

HealthGrades® is the nation’s leading independent healthcare ratings or-

ganization (www.healthgrades.com).

Sacred Heart Regional Stroke Center is also the recipient of the

American Stroke Association Gold Plus Performance Achievement Award

for its commitment and success in implementing excellent care for stroke

patients. This is the second year in a row that Sacred Heart has received

this prestigious honor.

For more information on Sacred Heart Hospital’s awards for quality

patient care, visit www.sacred-heart.org/qualityreport.

“Good Medicine”, continued from page 1

companies. IFF providers are companies that own hospitals and employ doctors and most importantly, do not operate on a fee- for- service basis. A current example might be Kaiser Permanente. Enablers of this transforma-tion are things like telemedicine, e-medicine and improved in-office diag-nostics. With better control of overhead costs and a profit based model on wellness not sickness these new companies will replace traditional insur-ance companies. Prof. Christensen says that the business of medicine is not unlike the retail business or automobile manufacturing. A product often starts out as expensive and affordable to only a few, but through unexpected innovations in technology or new business models products become more affordable – think model T Ford and the assembly line or cell phone and computers. Based on the above assumptions, Prof. Christensen predicts the fol-lowing:1) More employers will be self insured. They will use IFF services com-bined with HSA’s to pay for health care. The HSA will be structured as a tax advantaged savings account, not just a health plan. Traditional insurance companies that offer comprehensive coverage not individually tailored to the individual will struggle to remain in the fee for service business.2) Primary care physicians will be salaried with bonuses based on health performance and measured outcomes.3) Employers will direct contract with hospitals, retail clinics and outpa-tient clinics until IFF programs are available. They will encourage medical tourism abroad when high costs procedures are needed.4) Employers will offer personally controlled electronic health records.5) Employers will contract with disease management networks to help with behavior-dependent chronic disease.6) Hospitals will deconstruct into distinct facilities for heart care, ortho-pedic care and so on. Each facility will have to have its own cost account-

ing. These specialty hospitals will move to become IFF providers and will compete with traditional insurance companies by offering care for a fixed fee at a lower cost. They will have lower overhead and market themselves as having better outcomes. 7) Medical Tourism Travel is cheap compared to the cost of many medi-cal procedures. More and more patients will be willing to travel to centers of excellence that also offer a less expensive and guaranteed price. The Shouldice Hospital north of Toronto offers hernia repair for four to five thou-sand dollars less than in the US and with a lower complication rate. Hos-pitals in Singapore, Thailand, and India pay lower wages and lower their overhead costs on a value added process business model. A patient can fly first class on Singapore Airlines, have a procedure done by world-class physicians in a world-class hospital, recover in a nearby resort, and then return to America for half the cost of the procedure done locally. 8) Pharmaceutical companies will see fewer blockbuster drugs as medi-cines will be more precise an individually designed. Drug companies will increasingly market their drugs directly to patients. Activities that are now outsourced such as drug discovery, manufacturing and clinical trials will re-turn as core activities for making profits. Overseas countries such as Israel and India that now are involved in generics will begin to develop proprietary products at a 40% lower cost For those of us still in practice in ten years, it will be interesting to see how all these predictions pan out. Looking forward to seeing you at our June 8 CME Event and the Au-gust 10 General Membership Meeting at the Angus Restaurant. We are developing a website for all of our private practice physicians that will allow your patients to check out your office online, allow you to go to other referral physicians web pages and much more. Holly will be the WEB Meister and keep your site up to date.

Florida State University College of Medicine Regional Medical School Campus—Pensacola Class of 2010

Lesley McPeak

Thomas Babcock

Stephenie Scully

Sarah Friend David Gonzalez

Matthew Irwine

Danielle Barnes Katrina Hilder

Melissa Kozakiewicz Fernando Porter

Cara Irwin

Lisa Radkay

John-Paul Soberano Steffanie Swanson Amanda White Halei Wong

ECMS would like to send warm Congratulations to the Class of 2010!

Medical/Legal

Substantial Fraud and Abuse Provisions Enacted Under the Health Care Reform LawBy Laurel Hinote Thorpe, Esquire, Bozeman, Jenkins & Matthews P.A.

The recently signed Health Care Reform Law,

consisting of the Patient Protection and Afford-

able Care Act and the Health Care and Educa-

tion Reconciliation Act of 2010, contains significant initiatives related to

health care fraud and abuse. Federal officials have made it clear that

fighting health care fraud is a top priority for the administration. Provid-

ers can expect to see increased monitoring, investigation, and penalties

for violations of health care regulations. The Health Care Reform Law

puts the mechanisms, funding, and incentives in place to make discov-

ery of violations more likely. For the fiscal year 2011 the administration

has proposed that $1.7 billion be allocated to fighting health care fraud.

Now more than ever, it is important to exercise diligence in the develop-

ment of compliance programs in order to limit exposure to the expanded

enforcement provisions. This article will briefly outline some of the more

prominent additions and changes related to health care fraud and abuse

that are relevant to physicians.

Anti-Kickback Statute. The Health Care Reform Law provides a few

key adjustments to the definitions applied under the anti-kickback statute.

An individual is liable under the federal anti-kickback statute when he acts

“knowingly and willfully” in violation of the statute. The sentinel 9th Circuit

case of Hanlester Network v. Shalala, applying the “knowingly and will-

fully” standard, required that the defendant act with the specific intent to

disobey the law. In other words, to be found guilty, the person must know

that the statute prohibits the conduct and have the specific intent to violate

the statute by engaging in the illegal conduct. In 1996 an appellate court

in Florida declined to follow the Hanlester heightened intent requirements,

applying a looser standard. However, until the passage of the Health Care

Reform Act Hanlester was still “good law” although only in a minority of

jurisdictions.

Now, as statutorily defined, violation of the anti-kickback statute does

not require that the person have actual knowledge of the anti-kickback

statute or the specific intent to commit a violation. Further, the Health

Care Reform Act specifically ties violations of the anti-kickback statute to

the Federal False Claims Act, thereby opening up potential whistleblower

suits. Now, a False Claims Act action can be brought on the allegation

that the defendant knowingly submitted a claim for items or services that

was tainted by an underlying anti-kickback violation.

Overpayments under False Claims Act. Another significant provision

of the Healthcare Reform Law provides that identified Medicare overpay-

ments must be reported to HHS and repaid within sixty days. Overpay-

ments retained for more than 60 days will become an obligation under the

False Claims Act and become the basis for civil monetary penalties. It is

unclear how the language of the Federal False Claims Act and the Health

Care Reform Law will ultimately be reconciled, however compliance will

require meaningful internal procedures to identify and quickly process

known overpayments.

Self-Disclosure Protocol under Stark Laws. Current reforms require

that CMS develop a protocol for self-disclosure under Stark Laws. Stark

Laws prohibit physicians who have a financial relationship with a provider

of designated health services from making “referrals” of Medicare or Med-

icaid patients to such providers for purposes of receiving “designated

health services.” Stark Laws impose extraordinary financial liability for

technical violations. Experts often disagree on whether certain arrange-

ments violate the law and innovative corporate strategies are often re-

jected due to fears of non-compliance.

The Health Care Reform Law attempts to address these issues by

authorizing HHS to reduce the amount due and owing for all violations

under the Stark Law, with consideration of factors, such as the nature and

extent of the improper practice, timeliness of the disclosure, cooperation,

and other factors under the agency’s discretion. Increased monitoring of

health care organizations is likely to lead to the discovery of more viola-

tions; however, the newly created flexibility is designed to alleviate prob-

lems for minor technical violations of the law. At this point the true impact

of these provisions is unclear.

Disclosures Under the In-Office Ancillary Services Exception. The

Health Care Reform Law requires that physicians make certain disclo-

sures to patients under the in-office ancillary services exception to the

Stark Law. In order to qualify for the exception under new laws, physi-

cians must inform patients at the time of referral that the services can

be obtained from other providers and provide a list of alternatives in the

area. Although this provision was made effective retroactively to January

1, 2010, it is likely that additional guidance will be issued to address a

variety of outstanding issues.

Provider Screening Requirements. HHS will also be responsible for

establishing comprehensive screening procedures for health care provid-

ers and suppliers. Such measures will eventually extend not only to new

providers, but also to current providers and must include criminal back-

ground checks, fingerprinting, unscheduled and unannounced site visits,

and other screening measures deemed appropriate.

Mandatory Compliance Programs. Previously, providers and sup-

pliers were strongly encouraged to have compliance programs in place,

but such programs were voluntary. Under the Health Care Reform Law

providers must have such programs in place as a condition of enrollment

under government health care programs. HHS will outline the “core ele-

ments” of an adequate compliance program and providers will be respon-

sible for implementing programs that meet the standards set forth.

Conclusion. The fraud and abuse amendments in the Health Care

Reform Law add significantly to the already complex and lengthy list of

regulations imposed on health care providers. With enhanced enforce-

ment tools and penalties it is vital that providers put appropriate personnel

and resources in place in order to appropriately navigate the changes

ahead.

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ONE STOP LABORATORY SERVICES

• Surgical Pathology• Cytology• Pap smears• Clinical Lab Services (blood tests)• Draw Station for National Labs• Courier Services• Locally Owned

Charles E. Burns, M.D., Andres Candela, M.D., North J. Davis, M.D., Wendy S. Moreland, M.D.

Strategies for Growth.Healthy Practice Development.

The healthcare specialists at O’Sullivan Creel, LLPhave experience assisting practices with financialand operational issues in this complex industry. In addition to traditional accounting services like bookkeeping and retirement planning, we offer consulting services including:

Personnel AssessmentAccounts Receivable ReviewHospitalist Program ImplementationFinancial AnalysisPhysician AnalysisDaily Practice Operations & Systems OverviewInterim Practice ManagementBenchmarkingStrategic PlanningPolicy and Procedure DevelopmentHealthcare and IT System EvaluationNew Physician Practice Start-up

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Deposit products and services are offered through SunTrust Bank, Member FDIC.

Securities and Insurance Products and Services: Are not FDIC or any other Government Agency Insured · Are not Bank Guaranteed · May Lose ValueSunTrust Private Wealth Management Medical Specialty Group is a marketing name used by

provided by SunTrust Bank. Securities, insurance (including annuities and certain life insurance products) and other investment products and services are offered by SunTrust Investment Services, Inc., an SEC-registered investment adviser and broker/dealer and a member of FINRA and SIPC. Other insurance products and services are offered by SunTrust Insurance Services, Inc., a licensed insurance agency.

©2009 SunTrust Banks, Inc. SunTrust is a federally registered service mark of SunTrust Banks, Inc. Live Solid. Bank Solid. is a service mark of SunTrust Banks, Inc.

Specialized Wealth Management for Practices and Physicians

Your patients look to you for guidance. But when it

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Treasury and Payment Solutions Lending Investments Financial Planning

Florida SHOTS™

GOES WHERE THEY GO

With new patients coming to your office every day, finding immunization records can feel like a never-ending quest. Count on Florida SHOTS, Florida’s statewide online immunization registry, to complete the search in minutes. You can retrieve new patient records from other providers, enter historical data, and check immunization schedules.

With more than 100 million vaccination records in the registry, Florida SHOTS connects you to patient shot histories statewide. Move with your patients to Florida SHOTS, and file away tedious immunization record searches.

It’s fast, convenient, and travels well.

Make the Move.USE FLORIDA SHOTS.

www.flshots.com | 877-888-SHOT

RECORDS THAT NEVER RELOCATE

RETURN SERVICE REQUESTED

8880 University Pkwy., Suite BPensacola, FL 32514Ph: 850-478-0706 Fx: 850-474-9783Email: ECMSinfo@bellsouth.netExecutive Director: Holly StricklandAdmin. Asst: Ashley Jacobi

PRSRT STDU.S. POSTAGE

PAIDPERMIT #258

PENSACOLA, FL

View and opinions expressed in the Bulletin are those of the authors and are not necessarily those of the board of directors, staff or advertisers. The editorial staff reserves the right to edit or reject any submission.

Directory Corrections Inside on Page 7.

Upcoming Events

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Our Rates are Decreasing by an Average of 5%!*

Call MAG Mutual’s Dennis Wilson toll-free at 1-888-892-5216 or Ray Horn, Fisher-Brown Inc. at 850-994-2620 or visit us at www.magmutual.com.

Physician Ownership and Leadership • Financial Stability

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*Medical professional liability insurance rate reduction effective June 1, 2010. Actual rate adjustment depends on your medical specialty, location and other factors.**Dividend effective June 1, 2010. Dividend payments are declared at the discretion of the MAG Mutual Insurance Company Board of Directors.

$12.5 Million Dividend Declared in 2010!**