Healthcare: ICD-10 Update

It was recently announced that the ICD-10 mandate has been moved one year to Oct. 1, 2015. Your healthcare clients should use this delay to continue staff education efforts, to improve their clinical documentation processes, and to build a strong foundation for process improvement and downstream strategic initiatives (many of these activities may qualify for Retraining Tax Credits in Georgia). Adoption of ICD-10 remains a question of “when,” not “if.” The Retraining Tax Credit can provide $$ to help offset the costs, time and effort for ICD-10 (for more information click here).

ACA Feedback

We have done a non-scientific sampling of our clients and their plans for ACA (Affordable Care Act, or Obamacare). Check out this feedback:

  • “The implementation of the ACA is still in limbo to some degree…we see no need to change, but if our costs do go up significantly, then we may rethink this approach.”
  • “We have been somewhat relaxed with part time employees’ hours in the past but can’t be going forward. 30 hours is the threshold for part time employees, so we are monitoring this closely.”
  • “We have 250 seasonal workers who we will try to keep under 30 hours. Typically we don’t earn tax credits for this group of employees, but are aware now they need to average 24 hours if the (Retraining Tax) credit can be applied.”
  • “We used to cover 100% of health insurance but have now had to ask employees to contribute due to a large increase in premiums.”

What are your clients telling you?  How will their plans (or lack thereof!) affect their businesses and your relationships with them?

 

DaleSig

ACA and Net After Tax Credit Savings

We have heard a lot of concern about the new ACA healthcare program (also known as the Affordable Care Act, Obamacare, and other names) that starts in 2014. Many companies are considering big employee changes, such as reducing headcount, moving employees to part-time basis, and leveraging staffing firms/independent contractors. But be careful — these changes could negatively impact your clients’ tax credits and their net after tax savings.

We recently attended the Georgia Chamber of Commerce’s conference on the new Federal Healthcare program (click here for upcoming sessions). Watch out for these state tax credit variables:

  • Number of employees – different programs for small groups (49 or fewer employees) and large groups (50 or more employees), based on Full Time Equivalent (FTE) employees.
  • Employee – employees that work 30 hours/week or more must be offered coverage.
  • Unknowns – lots of unknowns such as affiliated service group impact, common law employee clarification, and play-or-pay penalties.
  • Federal Small Business Health Care Tax Credits –  may be available (company has 24 or fewer full-time employees and less than $50,000 in average employee wages, click here )

The following Georgia tax credits may apply to your clients’ employees:

  • Retraining Tax Credit – Each employee must average 24 hours/week or more and can include regular and leased employees
  • Job Tax Credit (including Opportunity Zones, Less Developed Census Tracts and other) – Each employee must average 35 hours/week or more and can include regular and leased employees

Your clients may think they are saving $ by making these changes, but their net after tax credit savings may not justify the changes! For example, if employees are reduced to less than 30 hours/week, the Job Tax Credit can’t be utilized, since the total head count for employees (35 hours/week) goes below the Job Tax Credit head count minimum threshold. Pretty confusing! So get on top of this now, and reach out to your clients to discuss these issues.

 

JimSig

Healthcare — ICD-10 Update

Although ICD-10 will not be implemented until 2014, many EHR software vendors are starting to educate their users about the upcoming ICD-10 changes.

Physician practices are doing readiness assessments, IT reviews and workflow changes. Many of these activities may qualify for retraining tax credits in 2013.

Talk with your healthcare providers about their plans for ICD-10 and make sure they know that the retraining tax credit may help.

 

JimSig

Healthcare — Rural Physician Tax Credit

It is hard to keep up with all of the healthcare incentives that are available, but make sure you don’t overlook The Georgia Rural Physician Credit! It is $5,000 per year tax credit available for 5 years (total = $25,000). There is no carryforward. This tax credit requires no forms to complete other than applying directly to the physician’s Georgia Individual Income Tax Return (GA Form 500). (Click here for a list of rural counties and here for a PDF of the rule).  Double-check your physician clients’ residence and practice locations to make sure they qualify.

 

JimSig

Healthcare — Meaningful Use Gaps Left by EHR Software

Your physician practice clients may feel that they are on top of Meaningful Use due to their new EHR software. However, it is unfair for them to ask their EHR software to do everything for Meaningful Use. In fact, if they passed every measure reported by their certified EHR, they could still fail an audit and be required to give back the Meaningful Use $ they received.

For more details, I found a good article that highlights these potential gaps (click here).  

Continue reaching out to your healthcare clients, and see how you can help!

JimSig

Healthcare — Georgia Firms Getting BIG Meaningful Use $$

The federal Meaningful Use program providing incentives for healthcare providers to adopt Electronic Health Records (EHRs) has paid 2,091 eligible Georgia providers $143.5 million. More than 100,000 American healthcare providers have been paid $5.7 billion under the Medicare and Medicaid Electronic Health Record Incentive Programs (click here).

 

JimSig

Healthcare — Meaningful Use and new HIPAA guide

The ONC has released a new guide (click here to download the PDF) as an aid to physician practices in the process of becoming compliant with theMeaningful Use $$ incentive requirement for privacy and security. A “Myths and Facts” section on page 11 is definitely worth reading.

A good summary of this guide can be found here.  

Continue reaching out to your healthcare clients, and see how you can help!

 

JimSig

Healthcare — EHR Installs Picking Up

Based on our discussions with physicians, practice managers, CPAs, consultants, and bankers, things are really picking up for EHR software training (we know this as $$ Retraining Tax Credit potential $$). This includes training in new software and/or upgrades of existing systems. The main driver here is the business justification for reducing costs, increasing profits, and improving patient quality. The Federal Meaningful Use incentive $$ have helped. The folks that have been watching from the sidelines are now jumping in and moving forward with their installations. Reach out to your healthcare clients and see how you can help!

 

JimSig

Healthcare — Delays Again

Some important healthcare program deadlines have been delayed again — here is a quick update:

HIPAA 5010: Was March 31,2012, now delayed until June 30, 2012 (click here)

ICD-10: Was October 1, 2013, now delayed until ??? “Health and Human Services will announce a new compliance date moving forward.” (click here)

Meaningful Use: CMS and ONC intends to finalize the Stage 2 rules by midyear 2012. Stage 2 will begin in 2014 (click here )

 

JimSig

GSCPA Healthcare Conference Update

We exhibited at the annual GSCPA Healthcare Conference this month. There were over 240 attendees. Here are some highlights:

  • John Fox, CEO of Emory Healthcare: The business of healthcare isquickly moving to an outcome based pay for performance model, away from fees based on procedures. The new physicians entering the work force are looking for work-life balance, work environment and stability as key factors in their job search. He emphasized thatwe can’t continue with the current “Tower of Babel” approach of multiple EMRs (electronic medical records systems) that can’t talk with each other. He said that integration and cooperation will drive down cost by increasing patient quality and increasing efficiencies.
  • Physician practices that are merging with other practices or selling to hospitals: There were several sessions about selling a practice and business valuation. The key drivers for added valuation (that is, above the classical EBITDA multiple) are how tightly integrated are the practice’s workflows and EMR, how well is patient quality tracked, and what other services are performed (such as physical therapy, CT, and other related services).

This was a great conference to hear speakers, meet healthcare CPAs, and stay abreast of the rapidly changing healthcare environment. We hope to see you there next year!

JimSig

Healthcare — Meaningful Use Results So Far

We have been asked many times if the Meaningful Use (MU) incentive is real, and what are the results? Well, we finally have some hard numbers.

According to a report submitted to the HIT Policy Committee on Jan. 10, 2012, the total registrations during 2011 were 124,089 Eligible Professionals (EPs) for Medicare, 39,503 EPs for Medicaid, and 2,834 hospitals for both programs. Medicaid’s 9,614 EP registrations in December eclipsed Medicare’s 8,996, reflecting that 43 states now have launched their Medicaid meaningful use programs, and 33 have already paid incentives.

Through 2011, Medicare made $1.384 billion in Meaningful Use payments, and Medicaid paid $1.149 billion, bringing the total to nearly $2.534 billion. About 33,595 EPs had attested under the Medicare program with 99 percent successful. During 2011, 842 hospitals attested and all were successful (click here for the government report).

JimSig

Healthcare — Meaningful Use $$ Medicaid

For physician practices that have Medicaid patients, we talked with Don Betts, Georgia Tech, who is a service delivery partner with GA-HITREC (click here). Don specializes in assisting physician practices in achieving Meaningful Use, and here is an overview of what he had to say regarding Medicaid’s Meaningful Use:

Healthcare providers can receive a maximum of $63,750 from Medicaid over a six year period. Eligible Professional (EP) means more provider types than the Medicare incentive – in addition to physicians, it includesnurse practitionersmidwivesdentists and physician assistants at a Federally Qualified Health Center (FQHC). The incentive is based on using a certified Electronic Health Record (EHR) in a defined Meaningful Use way. The Meaningful Use requirements will be phased in over 3 stages and several years, with Stage 1 having started in 2011. Medicaid is making it easier to receive the incentive for 2011 and 2012. EPs don’t have to meet Stage 1 requirements but merely show that they have adopted, implemented, or upgraded to a certified EHR. Here are some takeaways for Medicaid Stage 1 (2011 and 2012):

  • How much $$: Each EP that has a minimum of 30% Medicaid patient encounters (20% for Pediatricians) can receive $21,250 in year one. For example, if there are 5 EPs in the practice, then there may be up to $106,250 (5 x $21,250) of incentives for year 1. Each EP’s patient volume needs to be reviewed to determine if there is potential. They can also qualify as a group.
  • Who gets paid: Similar to Medicare, payments are made to the individual EP (his or her SSN) or to the physician practice (the practice’s TIN number). The EP may reassign the incentive $ to the physician practice.
  • How to get paid: To get paid for year 1, each EP has to register with CMS, then “attest” with DCH by showing proof of the EHR upgrade and completing a volume calculator.
  • State of Georgia: The Georgia Department of Community Health (DCH) administers the meaningful use program (click here ).
  • HIPAA: don’t forget to review the new privacy and security requirements.

One final note — many physician practices have already qualified for Stage 1 and have received their checks. This is real money flowing to the practices (for details, click here ). If your client has potential, make sure they can benefit!

JimSig

Healthcare — Meaningful Use $$ for Medicare

Many CPA firms have asked us about the Federal Meaningful Use incentive and the potential $$ for their clients. I spoke with Liz Hansen, VIA Consulting Group, who is a service delivery partner with GA-HITREC (clickhere). Liz specializes in assisting physician practices in achieving Meaningful Use, and here is an overview of what she had to say:

Physicians, or Eligible Professionals (EPs), can receive a maximum of$44,000 for Medicare over a 5 year period. The incentive is based on using a Meaningful Use Certified EHR (EMR) in a defined Meaningful Use way. The incentive is divided into 3 Stages, with Stage 1 starting in 2011 or 2012. Here are some takeaways for Medicare Stage 1:

  • How much $$: The $$ incentive is 75% of Medicare Part B allowable charges up to a maximum of $24,000 of charges in a year for each EP (75% of $24,000 = $18,000 for Stage 1). For example, if there are 5 EPs in the practice, then there may be up to $90,000 (5 x $18,000) of incentive for Stage 1. Each physician’s Medicare allowable charges needs to be reviewed to determine if there is potential.
  • Who gets paid: Payments are made to the individual EP (his or her SSN) or to the practice (the practice’s EIN number). To make sure everyone is on the same page, you must review employment contracts, operating agreements, ownership changes (physicians join or leave the practice), non-equity physician expectations and other items, so that when the Meaningful Use check $ arrives, you know who gets the money.
  • How to get paid: To get paid for Stage 1, each EP has to “attest,” that is, use the EHR per the meaningful use requirements for a 90 day time period and report this data on the CMS website. It is a pass/fail grade. If the EP has a passing grade, the check will be mailed. If the EP fails, he or she will have to start the 90 day time period all over again.
  • HIPAA: don’t forget to review the new privacy and security requirements.

One final note — many physician practices have already qualified for Stage 1 and have received their checks. This is real money flowing to the practices (for details, click here ). If your client has potential, make sure they can benefit!

JimSig

HIPAA 5010 and Retraining Tax Credits

Beginning on January 1, 2012 the new HIPAA 5010 electronic transaction standards will affect almost every aspect of a physician practice’s reimbursement and revenue stream (click here). This may require software upgrades, workflow changes and employee training. Employee training on the 5010 regulations does not count for the Retraining Tax Credit since it involves regulations. However, employee training on the new/upgraded software and workflow changes may count for the Retraining Tax Credit. Talk with your clients about their preparation for HIPAA 5010 and let them know that a tax credit could help out.

Upcoming Events

November 4, 2011 – Georgia Medical Group Management Association (MGMA) 2011 Governmental/Third Party Payer Forum. Stop by our booth (Click here).

November 18, 2011 – Institute for Professionals in Taxation (IPT) Georgia One-Day Tax Seminar. This will be a great session to hear the new DOR commissioner and talk with DOR policy folks. Hope to see you there. (to download brochure click here).