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

o make sure they get the most out of the Physician

Quality Reporting System incentive program, partic-ipating physicians need to be aware of the changes in place for 2012.

S ome changes are designed to align with o t h e r C e n t e r s f o r Medicare & Medicaid Services (CMS) quality reporting programs. A number of new measures for reporting also have been introduced. The additions provide greater reporting opportunities as pa r t of a n ef for t to

increase participation in the voluntary pay-for-reporting program.The 2012 bonus for successful reporters is 0.5 percent of total

allowed charges under the Medicare Physician Fee Schedule.However, penalties are looming. Eligible physicians who do not

successfully submit Physician Quality Reporting System (PQRS) measures during 2013 will have their Medicare reimbursement reduced by 1.5 percent in 2015. The penalty rises to 2 percent in 2016 and beyond.

Group defined as 25+Beginning in 2012, CMS has consolidated two PQRS group

practice reporting options (GPRO) into one. A practice must now include 25 or more eligible professionals billing Medicare under a single tax identification number to participate as a group. Additionally, once CMS has approved a group’s participation,

the group must continue to meet the minimum requirement for the entire reporting period.

To participate in the GPRO, new groups must self-nominate no later than Jan. 31, 2012. Those wishing to participate in both the Physician Quality Reporting and the e-prescribing group practice reporting options must provide that information in their self-nomination statements.

Groups with 25 or more eligible professionals that previously partic-ipated in the Physician Quality Reporting program qualify auto-matically for participation in 2012 and future years. However, they must notify CMS in writing of their desire to continue participation in the PQRS group reporting option for the respective program year.

See Incentive programs on page 2

Although 69 percent of doctors in small and medium-sized medical practices are happy with their career choice, they recognize that sizable negatives exist, according to a recent survey.

Physicians reported the following chief negatives in the “2011 State of the Small Practice” survey by Practice Fusion, a free electronic health record company:

▲ 41 percent saw their practice’s financial health decline compared to 2010.

▲ 31 percent reported increased practice management costs.

▲ 26 percent experienced delayed insurance reimbursements and payments.

▲ 11 percent were concerned about the number of difficult patients and high appointment volume.

They also expressed reasons for optimism in the future:

▲ Increased services and medical advancements

▲ Higher number of patients who are more satisfied

▲ High-quality healthcare providers

▲ Improved practice efficiency and healthcare technology

▲ Higher income and reimbursements

Doctors view electronic health records posit ively despite 73 percent of their practices using computers that are three years old or older and 21 percent using five- to six-year-old computers. Three of five survey respondents recognize that new technology has made practice administration easier.

Because of the small national sample of 100 survey participants, physicians should judge the value of this data for themselves and compare it with their own experiences. ❚

Physicians see practice positives and negatives

I n s i d e

I n s i d e

Jan./Feb. 2012➜Leaving your practice?

Exit strategies to consider

➜Pilot program combines incentive program reporting

2012

addflexibility

incentiveprograms

The 2012 bonus for successful reporters is 0.5 percent of total allowed charges under the

Medicare Physician Fee Schedule.

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

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. © 2012 CPAmerica International

Your Healthy Practice

While group practices not meeting the 25-member minimum are ineligible to participate in the group reporting option, their members can participate in the incentive program as individuals.

Reporting periods and mechanismsCenters for Medicare & Medicaid Services has eliminated the six-

month period for claims-based and registry reporting previously available under the Physician Quality Reporting System with one exception – reporting measures groups via registry. This aligns the

reporting periods with the electronic health records (EHR) and other CMS quality reporting programs.

Eligible professionals who choose the claims-based reporting mechanism are required to submit the appropriate PQRS quality data codes on their Medicare Part B claims. The claims must be processed no later than Feb. 28, 2013, for the 2012 reporting period ending Dec. 31.

CMS has also added a reporting option for EHR-based reporting that mirrors the

criteria for meeting meaningful use under the EHR Incentive Program in an effort to align the two programs.

Those choosing an EHR-based reporting mechanism can submit data to CMS either directly from their PQRS-qualified electronic health record technology or through a qualified EHR data submission vendor.

Be aware that certified EHR technology under the Medicare and Medicaid EHR Incentive Programs may not be considered qualified under the Physician Quality Reporting System since it may not be able to meet PQRS file specifications. CMS is modifying its list of electronic health record vendors qualified under the PQRS program to indicate which products have also been certified for the EHR Incentive Programs.

Reporting quality measures Individual eligible professionals specializing in internal medicine,

family practice, general practice or cardiology aren’t required to report on Physician Quality Reporting core measures aimed at promoting the prevention of cardiovascular conditions as originally proposed. CMS backed off this requirement because of operational limitations. However, they strongly encourage physicians to report these measures as part of an effort to promote preventive care for the condition.

CMS has expanded the field of individual measures to 211, adding 26 new ones for claims- or registry-based reporting. Also, all 44 measures reportable in the Medicare EHR Incentive Program are now included as individual measures.

For reporting under the PQRS group practice reporting option, CMS finalized 29 measures, most of them aligning with the Medicare Shared Savings program.

For a list of all the measures and complete details on the 2012 Physician Quality Reporting System program, go to CMS’s website at www.cms.hhs.gov/PQRS. – Irene E. Lombardo

Incentive programs continued from page 1

Are you overworked?Surveys of doctors conducted in recent years reveal that

almost half plan to reduce their workload or quit altogether.In his book, The Seven Habits of Successful Living, Steven

Covey advises business owners to “begin with the end in mind.” Every business owner, regardless of the type of business, needs an exit strategy.

When you decide the time has come for you to move on, you will need to have the answers to two questions:

▲ How will you to get your money out of the practice?▲ How much will you get?Working out an exit strategy in advance helps assure you

will be able to answer those two questions and gives you some control over the future of your practice. Here are five exit strategies that may or may not make sense in your situation.

Liquidate – Selling your assets and locking the door may or may not recover the value from your practice. This strategy works best if you own land, buildings and expensive equipment. Of course, you will have to pay off your creditors before you take any value for yourself.

Leave a legacy – If you have a son, daughter or other younger relative following in your footsteps, you may be able to groom that young physician to take over your practice. Before adopting this strategy, be sure you understand the emotional issues involved in family succession plans.

Groom successor, or sell to existing partner – If you do not practice with a partner, perhaps you can identify a

younger doctor you can develop into a potential practice leader. If so, the successor may eventually be able to purchase the practice from you, using future profits to fund your buyout. Of course, your financial future will be subject to the success – or failure – of the new owner.

Sell the practice to another practice – Positioning your practice for sale can be a profitable exit strategy. Other practices may be interested in yours for a variety of reasons, from a quick path to expansion to eliminating the competition. With this strategy, you will need to identify potential acquirers early and position your practice to be an attractive acquisition candidate.

Eye initial public offering option skeptically – Twenty years ago, the physi-cian practice management (PPM) industry was all the rage. PPM was a new business model based on consolidating healthcare systems and physician practices under entrepreneurial management. PPM became a large public market segment, with more than 30 public compa-nies created and grown by acquisitions.

Within 10 years, however, the sector’s health had declined dramatically, with insufficient post-roll-up cash flows to support the valuations. Today, an initial public offering, or IPO, seems unlikely as a viable exit strategy for medical practices.

Building a successful practice takes planning, effort and luck. The same is true for leaving a successful practice. – Mike Redemske, CPA

Leaving your practice? Exit strategies to considerIt’s easier to qualify for certification incentive

The requirements needed for healthcare pro-fessionals to receive an additional 0.5 percent incent ive under t he Maintenance of Certification Program have been eased.

The program, which is operated by a specialty body of the American Board of Medical Specialties, enables the eligible professionals to earn the bonus by submitting data more frequently than is required to qualify for, or maintain, board certification status.

For 2012, providers must meet Part 1 of the program and partici-pate more frequently in at least one of the remaining three parts. The four parts, as d e s c r i b e d i n t h e Centers for Medicare & Medicaid Services’ doc-ument “The Physician Qual ity Repor t ing System Maintenance of Certification Program Incentive,” are:

▲ Part 1: “Maintain a valid, unrestricted medical license in the United States”

▲ Part 2: “Participate in educational and self-assessment programs that require an assessment of what was learned”

▲ Part 3: “Demonstrate through a formalized, secure examination, that the physician has the fundamental diagnostic skills, medical knowledge and clinical judgment to provide quality care in their respective specialty”

▲ Part 4: “Successfully complete a qualified Maintenance of Certification program practice assessment”

Previously, eligible professionals were required to participate more frequently in each of the four parts of the program. Determination of what is considered “more frequently” is tied to the specific requirements of board certification for the professional.

To learn more about the Maintenance of Certification Program, go to www.cms.gov/pqrs/01_overview.asp? – Irene E. Lombardo

A new pilot program will simplify reporting for two incen-tive programs.

As part of the pilot program, eligible professionals partici-pating in the Medicare Electronic Health Record (EHR) Incentive Program can report clinical quality measures electronically using certified EHR technology for the 2012 payment year.

Currently, providers in the Medicare EHR Incentive Program use an attestation method for reporting clinical quality measures. Providers who successfully participate in the pilot will receive both Medicare EHR and Physician Quality Reporting System (PQRS) incentives.

The PQRS-Medicare EHR Incentive Pilot is part of a move to integrate the programs and enable providers to satisfy reporting requirements for both programs. Participation is voluntary. Those who do not wish to participate may continue to report on EHR incentive program quality measures through the attestation method.

Eligible providers who volunteer for the pilot must participate in both incentive programs. They will submit data for Medicare patients on the same clinical quality measures required for the Medicare EHR Incentive Program based on one calendar year, specifically:

▲ Three core measures▲ Up to three of the alternate core measures if the denomi-

nator for one or more of the core measures is zero

▲ Three additional measures as required to successfully demonstrate meaningful use

In addition, participants must meet and attest to the remaining 14 core objectives and required menu set objectives under Stage 1 criteria using the attestation module on the Centers for Medicare & Medicaid Services (CMS) website for the electronic health record program.

Providers can submit data from their certified electronic health record technology to PQRS-qualified EHR data submis-sion vendors. Alternatively, providers can submit data directly from their electronic health record technology to CMS through a secure portal using the PQRS elec-tronic health record reporting mechanism. In this case, the provider’s certified electronic health record technology must also be a PQRS-qualified EHR.

Visit the Physician Quality Reporting System section of the CMS website for a list of PQRS-qualified EHR vendors. Additional vendors will be added to the list this summer.

Any participant who cannot complete the pilot can return to the Medicare EHR Incentive Program attestation module on the CMS website to complete attestation for that program.

To participate in the PQRS-Medicare EHR Incentive Pilot, eligible providers can sign up under the Electronic Health Record Incentive Program attestation module on the CMS website at www.cms.gov/EHRIncentivePrograms/32_Attestation.asp#TopOfPage. – Irene E. Lombardo

Pilot program combines incentive program reporting

January / February 2012 Your Healthy Practice2 January / February 2012 Your Healthy Practice 3

While group practices not meeting the 25-member minimum are ineligible to participate in the group reporting option, their members can participate in the incentive program as individuals.

Reporting periods and mechanismsCenters for Medicare & Medicaid Services has eliminated the six-

month period for claims-based and registry reporting previously available under the Physician Quality Reporting System with one exception – reporting measures groups via registry. This aligns the

reporting periods with the electronic health records (EHR) and other CMS quality reporting programs.

Eligible professionals who choose the claims-based reporting mechanism are required to submit the appropriate PQRS quality data codes on their Medicare Part B claims. The claims must be processed no later than Feb. 28, 2013, for the 2012 reporting period ending Dec. 31.

CMS has also added a reporting option for EHR-based reporting that mirrors the

criteria for meeting meaningful use under the EHR Incentive Program in an effort to align the two programs.

Those choosing an EHR-based reporting mechanism can submit data to CMS either directly from their PQRS-qualified electronic health record technology or through a qualified EHR data submission vendor.

Be aware that certified EHR technology under the Medicare and Medicaid EHR Incentive Programs may not be considered qualified under the Physician Quality Reporting System since it may not be able to meet PQRS file specifications. CMS is modifying its list of electronic health record vendors qualified under the PQRS program to indicate which products have also been certified for the EHR Incentive Programs.

Reporting quality measures Individual eligible professionals specializing in internal medicine,

family practice, general practice or cardiology aren’t required to report on Physician Quality Reporting core measures aimed at promoting the prevention of cardiovascular conditions as originally proposed. CMS backed off this requirement because of operational limitations. However, they strongly encourage physicians to report these measures as part of an effort to promote preventive care for the condition.

CMS has expanded the field of individual measures to 211, adding 26 new ones for claims- or registry-based reporting. Also, all 44 measures reportable in the Medicare EHR Incentive Program are now included as individual measures.

For reporting under the PQRS group practice reporting option, CMS finalized 29 measures, most of them aligning with the Medicare Shared Savings program.

For a list of all the measures and complete details on the 2012 Physician Quality Reporting System program, go to CMS’s website at www.cms.hhs.gov/PQRS. – Irene E. Lombardo

Incentive programs continued from page 1

Are you overworked?Surveys of doctors conducted in recent years reveal that

almost half plan to reduce their workload or quit altogether.In his book, The Seven Habits of Successful Living, Steven

Covey advises business owners to “begin with the end in mind.” Every business owner, regardless of the type of business, needs an exit strategy.

When you decide the time has come for you to move on, you will need to have the answers to two questions:

▲ How will you to get your money out of the practice?▲ How much will you get?Working out an exit strategy in advance helps assure you

will be able to answer those two questions and gives you some control over the future of your practice. Here are five exit strategies that may or may not make sense in your situation.

Liquidate – Selling your assets and locking the door may or may not recover the value from your practice. This strategy works best if you own land, buildings and expensive equipment. Of course, you will have to pay off your creditors before you take any value for yourself.

Leave a legacy – If you have a son, daughter or other younger relative following in your footsteps, you may be able to groom that young physician to take over your practice. Before adopting this strategy, be sure you understand the emotional issues involved in family succession plans.

Groom successor, or sell to existing partner – If you do not practice with a partner, perhaps you can identify a

younger doctor you can develop into a potential practice leader. If so, the successor may eventually be able to purchase the practice from you, using future profits to fund your buyout. Of course, your financial future will be subject to the success – or failure – of the new owner.

Sell the practice to another practice – Positioning your practice for sale can be a profitable exit strategy. Other practices may be interested in yours for a variety of reasons, from a quick path to expansion to eliminating the competition. With this strategy, you will need to identify potential acquirers early and position your practice to be an attractive acquisition candidate.

Eye initial public offering option skeptically – Twenty years ago, the physi-cian practice management (PPM) industry was all the rage. PPM was a new business model based on consolidating healthcare systems and physician practices under entrepreneurial management. PPM became a large public market segment, with more than 30 public compa-nies created and grown by acquisitions.

Within 10 years, however, the sector’s health had declined dramatically, with insufficient post-roll-up cash flows to support the valuations. Today, an initial public offering, or IPO, seems unlikely as a viable exit strategy for medical practices.

Building a successful practice takes planning, effort and luck. The same is true for leaving a successful practice. – Mike Redemske, CPA

Leaving your practice? Exit strategies to considerIt’s easier to qualify for certification incentive

The requirements needed for healthcare pro-fessionals to receive an additional 0.5 percent incent ive under t he Maintenance of Certification Program have been eased.

The program, which is operated by a specialty body of the American Board of Medical Specialties, enables the eligible professionals to earn the bonus by submitting data more frequently than is required to qualify for, or maintain, board certification status.

For 2012, providers must meet Part 1 of the program and partici-pate more frequently in at least one of the remaining three parts. The four parts, as d e s c r i b e d i n t h e Centers for Medicare & Medicaid Services’ doc-ument “The Physician Qual ity Repor t ing System Maintenance of Certification Program Incentive,” are:

▲ Part 1: “Maintain a valid, unrestricted medical license in the United States”

▲ Part 2: “Participate in educational and self-assessment programs that require an assessment of what was learned”

▲ Part 3: “Demonstrate through a formalized, secure examination, that the physician has the fundamental diagnostic skills, medical knowledge and clinical judgment to provide quality care in their respective specialty”

▲ Part 4: “Successfully complete a qualified Maintenance of Certification program practice assessment”

Previously, eligible professionals were required to participate more frequently in each of the four parts of the program. Determination of what is considered “more frequently” is tied to the specific requirements of board certification for the professional.

To learn more about the Maintenance of Certification Program, go to www.cms.gov/pqrs/01_overview.asp? – Irene E. Lombardo

A new pilot program will simplify reporting for two incen-tive programs.

As part of the pilot program, eligible professionals partici-pating in the Medicare Electronic Health Record (EHR) Incentive Program can report clinical quality measures electronically using certified EHR technology for the 2012 payment year.

Currently, providers in the Medicare EHR Incentive Program use an attestation method for reporting clinical quality measures. Providers who successfully participate in the pilot will receive both Medicare EHR and Physician Quality Reporting System (PQRS) incentives.

The PQRS-Medicare EHR Incentive Pilot is part of a move to integrate the programs and enable providers to satisfy reporting requirements for both programs. Participation is voluntary. Those who do not wish to participate may continue to report on EHR incentive program quality measures through the attestation method.

Eligible providers who volunteer for the pilot must participate in both incentive programs. They will submit data for Medicare patients on the same clinical quality measures required for the Medicare EHR Incentive Program based on one calendar year, specifically:

▲ Three core measures▲ Up to three of the alternate core measures if the denomi-

nator for one or more of the core measures is zero

▲ Three additional measures as required to successfully demonstrate meaningful use

In addition, participants must meet and attest to the remaining 14 core objectives and required menu set objectives under Stage 1 criteria using the attestation module on the Centers for Medicare & Medicaid Services (CMS) website for the electronic health record program.

Providers can submit data from their certified electronic health record technology to PQRS-qualified EHR data submis-sion vendors. Alternatively, providers can submit data directly from their electronic health record technology to CMS through a secure portal using the PQRS elec-tronic health record reporting mechanism. In this case, the provider’s certified electronic health record technology must also be a PQRS-qualified EHR.

Visit the Physician Quality Reporting System section of the CMS website for a list of PQRS-qualified EHR vendors. Additional vendors will be added to the list this summer.

Any participant who cannot complete the pilot can return to the Medicare EHR Incentive Program attestation module on the CMS website to complete attestation for that program.

To participate in the PQRS-Medicare EHR Incentive Pilot, eligible providers can sign up under the Electronic Health Record Incentive Program attestation module on the CMS website at www.cms.gov/EHRIncentivePrograms/32_Attestation.asp#TopOfPage. – Irene E. Lombardo

Pilot program combines incentive program reporting

January / February 2012 Your Healthy Practice2 January / February 2012 Your Healthy Practice 3

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

(727) 821-6161If we may answer any of your questions on the information contained in this

publication, please contact us.

o make sure they get the most out of the Physician

Quality Reporting System incentive program, partic-ipating physicians need to be aware of the changes in place for 2012.

S ome changes are designed to align with o t h e r C e n t e r s f o r Medicare & Medicaid Services (CMS) quality reporting programs. A number of new measures for reporting also have been introduced. The additions provide greater reporting opportunities as pa r t of a n ef for t to

increase participation in the voluntary pay-for-reporting program.The 2012 bonus for successful reporters is 0.5 percent of total

allowed charges under the Medicare Physician Fee Schedule.However, penalties are looming. Eligible physicians who do not

successfully submit Physician Quality Reporting System (PQRS) measures during 2013 will have their Medicare reimbursement reduced by 1.5 percent in 2015. The penalty rises to 2 percent in 2016 and beyond.

Group defined as 25+Beginning in 2012, CMS has consolidated two PQRS group

practice reporting options (GPRO) into one. A practice must now include 25 or more eligible professionals billing Medicare under a single tax identification number to participate as a group. Additionally, once CMS has approved a group’s participation,

the group must continue to meet the minimum requirement for the entire reporting period.

To participate in the GPRO, new groups must self-nominate no later than Jan. 31, 2012. Those wishing to participate in both the Physician Quality Reporting and the e-prescribing group practice reporting options must provide that information in their self-nomination statements.

Groups with 25 or more eligible professionals that previously partic-ipated in the Physician Quality Reporting program qualify auto-matically for participation in 2012 and future years. However, they must notify CMS in writing of their desire to continue participation in the PQRS group reporting option for the respective program year.

See Incentive programs on page 2

Although 69 percent of doctors in small and medium-sized medical practices are happy with their career choice, they recognize that sizable negatives exist, according to a recent survey.

Physicians reported the following chief negatives in the “2011 State of the Small Practice” survey by Practice Fusion, a free electronic health record company:

▲ 41 percent saw their practice’s financial health decline compared to 2010.

▲ 31 percent reported increased practice management costs.

▲ 26 percent experienced delayed insurance reimbursements and payments.

▲ 11 percent were concerned about the number of difficult patients and high appointment volume.

They also expressed reasons for optimism in the future:

▲ Increased services and medical advancements

▲ Higher number of patients who are more satisfied

▲ High-quality healthcare providers

▲ Improved practice efficiency and healthcare technology

▲ Higher income and reimbursements

Doctors view electronic health records posit ively despite 73 percent of their practices using computers that are three years old or older and 21 percent using five- to six-year-old computers. Three of five survey respondents recognize that new technology has made practice administration easier.

Because of the small national sample of 100 survey participants, physicians should judge the value of this data for themselves and compare it with their own experiences. ❚

Physicians see practice positives and negatives

I n s i d e

I n s i d e

Jan./Feb. 2012➜Leaving your practice?

Exit strategies to consider

➜Pilot program combines incentive program reporting

2012

addflexibility

incentiveprograms

The 2012 bonus for successful reporters is 0.5 percent of total allowed charges under the

Medicare Physician Fee Schedule.

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

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. © 2012 CPAmerica International

Your Healthy Practice