Acupuncture Malpractice Insurance American Acupuncture Council Practice Building

The following is an actual transcript of the American Acupuncture Live Event with Marilyn Allen and Dr. Sam Collins. We do our best to make sure the transcript is as accurate as possible; however, it may contain spelling or grammatical errors. If you have any questions about the transcript feel free to contact us at 866-802-4476.

Marilyn Allen: Hello, and welcome to all of you. We’re from the American Acupuncture Council. I’m Marilyn Allen. I do the marketing for the council. We sell malpractice insurance, and with me is Sam Collins who is the insurance expert. We’re going to talk to you today somewhat about practice management, new patients, money, and insurance. We hope that you enjoy it, and we hope that you’ll find it very helpful for what you’re going to do in your practice. We would like you to be successful to the best of your ability, whatever that means to you, and we want you to use this as a resource, so here we go.

Dr. Sam Collins: Thank you, Marilyn. This is good. I’m happy to be here, and I think this is going to be a successful thing for all of us because I think it’s important for the profession to understand how to be successful on the business end. Certainly you understand how to treat patients, how to make them well but, of course, to keep a practice open, you have to pay your bills as well and, to make sure we have that, we’re going to do some practice management with them today to make sure they understand that. Marilyn, why don’t we go ahead and get started and give them some information?

Marilyn Allen: When a new patient comes into your office, you have to work with a new patient procedure, and one of the things that’s important in the new patient procedure is a financial consultation, just the same as you have the health consultation, but in the financial consultation, you establish in your procedure how the patient is going to pay their bill. There are a number of different ways that patients can pay bills. Obviously, we all want patients to pay cash, but with the Affordable Care Act and with patients having insurance, they want their insurance to reimburse for acupuncture services so you have to figure out how to help them. Most patients don’t understand their insurance benefits.

The first way is, we always have cash patients. Hopefully, you’ll have more cash patients than you have anything else. This means cash, checks, MasterCard, credit cards, ATM. You will need to have a credit card machine or the little square in your office so that you can take credit card payments. All patients are cash patients of some kind. They pay something on every visit. How the patient is going to pay for their services, other ways than just the cash, is up to you. Insurance plans rarely pay 100%. Patients will still have to pay their deductible, usually at the beginning of the year. They’ll need to pay copayments as they go along or coinsurance.

The next kind of patient is an insurance patient. This means they will have a copay, a coinsurance, or a deductible fee for the service that you render. When a patient has insurance coverage, it’s advisable, I say it’s necessary to check on each coverage for each patient. Insurance plans and coverage can vary even within companies. For example, Blue Cross has over 200 different companies with different names, even though they all belong to the parent company of Anthem. Each one of those insurance plans has different benefits depending upon the premium that either patients or an employer is paying.

The next kind of patient is a managed care patient. You can see right at the beginning it could be a health maintenance organization, healthcare organization, independent physicians association, or preferred provider. This is the type of financial arrangements where you, as a provider, is a credentialed provider. It means that you have applied and become accepted as a provider for a specific healthcare plan. There is usually a written agreement specifying the amount of payment. American Specialty Health, Landmark, OptumHealth, and ACN are all managed care networks. You cannot collect more money from the patient than what you have agreed to accept in the legal binding contract.

The next kind of patient that might come into your office is a Medicaid or Medi-Cal. Medi-Cal is just for California. Medicaid is the name that we use in the rest of the United States. This is state insurance for low income individuals and children. This type of insurance usually only covers one, two, or just a few visits per month and reimburses at a certain amount. Medicare is for seniors and people on disability, and it comes through the Social Security Administration. At this present time, it is not a covered benefit for acupuncture services.

Medicare does not pay for acupuncture to any provider nor pays for any services provided by an acupuncturist. We do have a bill in Congress that is going to be authored by Judy Chu, H.R.3849 which, if passed, would provide services to be covered by Medicare and Veterans.

The next kind of patient who you might see is under the category of Workers Compensation. This is the type of insurance that is paid for by an employer and covers workers who are hurt in the workplace or during the course of their employment. This coverage will vary from
state to state. Most states have benefits for acupuncture. You will need to find out your individual benefits in your state.

Personal injury is another kind of insurance. This is automobile patients, patients who are hurt in automobile accidents. There is medical payments. It’s called MedPay, and it’s an extra part of the insurance automobile policy. Check to see if your own policy has medical payments because those medical payments pay very well if you’re hurt in an automobile accident.

Dr. Sam Collins: Something also about personal injury, Marilyn, in California and many states, it is called MedPay but, in other states that have No-Fault, such as New York or Michigan, those states have something called PIP, which is personal injury protection, but works much in the same way as MedPay. In other words, these are payments that’ll be made directly to the provider and does include benefits for acupuncture.

Marilyn Allen: The next kind of possibility that someone might need to have is a payment plan. This is where the office makes arrangements with the patient for paying over a period of time. A patient can take the care now and then make payments over an extended time plan. One of the newer kinds of insurance is a flex plan, and this is where the employee selects that they will be able to withhold a certain amount of money from each pay period. The employer holds that money. The benefit of this is, this money is pretax dollars. The employee can go to the medical provider, chiropractor, acupuncturist, doctor, dentist and pays the deductible or the copay. They turn in a receipt to their employer, and they receive the reimbursement check.

The money must be used within one year, so the end of the year is coming, we’re almost in the month of December, so you would send out a letter like in October to your patient saying, “Come in. Take some extra visits.” It might be a time they could work on their face if they wanted or for stress reduction because of the end of the year. This one does not roll over.

Dr. Sam Collins: So in other words, Marilyn, what you’re saying is this is a plan if the patient doesn’t use it by the end of the year, the money just goes away?

Marilyn Allen: Goes back to the employer.

Dr. Sam Collins: Okay. We’ve got to make sure our patients are aware that they’ve got to use this within the year, and it’s money they can use for acupuncture.

Marilyn Allen: Yes. The next kind is a medical savings account. This is the same type of thing. The employee saves money in an account. The employer holds it, but this money can be used. It rolls over until the next year. People can save it for some bigger things that they want. Usually, eye issues are one of the things that medical savings account pay for, but this plan also pays for acupuncture. The patient pays you. They get reimbursed by their employer.

Some of you may want to use a trade or barter with some of your patients, particularly for services that you want to use. You might want your hair done, your car detailed, or you might even want to trade out for furniture in your office or for some exercise equipment, but you must keep very close track of the trade or barter because it needs to be equal to what your services are and their services are. This will be necessary when you pay your taxes.

Dr. Sam Collins: That’s one question I have. If you’re going to barter, you have to include the amount that you bartered as a revenue, correct?

Marilyn Allen: That’s correct.

Dr. Sam Collins: Okay, so that’s definitely something important. While it can be good, you do have to make sure to report that to IRS.

Marilyn Allen: Right. You need to be sure that your tax person, whoever helps you, understands that and helps you to be able to declare that in whatever way. Last is no charge. You have the right not to charge a patient. You notice I didn’t say it was free. Patients need to understand that your services have a value, but you can no-charge a patient. For example, we have one doctor here in the Los Angeles area that she does not charge her patients if they come in on the day that they’re born, their birthday. It’s like a little gift. Sam, let’s talk a little bit more about insurance. What are some of the things that you’ve done and how can you help us?

Dr. Sam Collins: Certainly, I think it’s important to know what insurance is, and I think often this is a very misunderstood factor by many acupuncturists because they’re certainly not familiar. They’ve been in school, and the entire time they’re in school, they’re saying to themselves, “I’m never going to bill insurance,” so therefore they have a lack of understanding of the potential benefits. I’m going to say you do not have to bill insurance, but I would certainly look to when there was good benefits, you want to access them.

The first thing I look at is to say, what really is insurance? I think we often use the term health insurance, and you’ll notice here it has a question mark because is it really health insurance? I think that’s frankly a misnomer. How we do insurance in the United States is not health, it’s sick insurance. The person has to have a diagnosis. Something has to be wrong. For acupuncture, it’s basically going to be for pain management, so therefore it has to be something wrong. It is not preventative in design.

As much as we may think that that’s what insurance should be, that is exactly what it is not in this current climate. Therefore, you have to think of insurance really is something when a person is sick, you make them better, but an important factor to understand is insurance aids in paying for services, does not pay in full in most instances.

I’ll give you some examples where it’ll pay in full, but it’s rare. If you have a veteran patient, a VA, which some of you are going to. I didn’t know VA paid for acupuncture. It does. For a VA patient, it pays in full, but the allowed amount under the plan so, technically, it pays in full, but at the VA rate, so be careful. Most plans patients will have some type of money they have to pay, whether deductible, whether it’s going to be a coinsurance or, if it’s an HMO, a copay, but certainly think of it in this term. If a patient has insurance, are they more likely to come in?

Here’s what I like to think about is, why insurance and is it worth it? Let’s first take a look at cash or non-reimbursable. If you think of it, why would you want to do an insurance practice? The reason I would is simply because it would equal patient. You look on the left side here, and you’ll notice it says insurance. It aids in paying for services. In other words, when a patient has insurance, are they more likely to come in? I think most everyone in the United States probably knows someone that’s not going to the doctor because they’re not covered or they simply can’t afford it. Therefore, when someone has insurance, they are more likely to go, so certainly I want to access that.

Along with the insurance, they’ll remember there is going to be deductibles. Copays and coinsurances will apply, and reimbursement will be limited as defined by the insurance. You’ll often hear someone say, “My insurance pays 100%,” and my question to that will be, “What do you mean by 100%? 100% of what?” Bear in mind, if you bill $100 for a service, the insurance may allow 100%, but only of what they allow, so if the insurance only allows $50, that means they’re going to pay 100% of $50, not of $100. My key factor for insurance, and that’s the last bullet here on the left side, says, “Patients and persons are more likely to seek care when there is third party reimbursement.”

I think most of you now, especially acupuncturists, have done a lot of cash patients, and I’m sure you’ve noticed while some cash patients are very adamant and will come in, you often will find you may recommend ten visits, and the patient may well need ten visits but, because they’re paying cash and because by the third visit they feel enough better, they generally stop coming. Conversely, if you look at that with an insurance patient, if you recommend ten and they’re only paying a $20 or $30 copay, they’re more than likely going to come for all ten visits simply because they’re getting some aid in paying for it.

When you think about “for cash,” patients must be made aware what is and is not covered. Bear in mind that, most often you’ll see here it says neuromusculoskeletal conditions, which means things like pain, so therefore that’s something that will be covered, but they have to understand, what if I have insurance and it’s not a condition that the insurance will cover, then that’s going to be cash, as well. What I would suggest is, don’t make them mutually exclusive. I can have a practice where I both take insurance and charge cash. The key factor is making sure I understand that, if an insurance doesn’t pay well, I do not have to accept it.

The last point I’ll make is that patients will pay for care for what they want, regardless of what the insurance is. In other words, you have patients now that will pay cash and will pay your full fee because they perceive the value to it. What I want to access is those patients who otherwise may not be sold or not understand it, they’re more likely to go in. Think again how many people need to go to the dentist, but don’t when they don’t have dental coverage even though they need it. I want to have it to be something that is not mutually exclusive, but you would do both.

If someone has a good insurance plan that pays well, like a VA or an auto insurance, I’m not going to turn that person away because I’ve had a bad experience with a very poorly paying Blue Shield plan, if you will.

Marilyn Allen: That’s why you want to be sure that you do some kind of financial consultation with them to make it clear to them and to you, the office, so that you know how the patient is going to pay and they know how they’re going to pay.

Dr. Sam Collins: Exactly. I think, for certain, most everyone when you go anywhere, you want to know what it’s going to cost you out of pocket to know whether or not, can I get this care and how much I can afford? If my insurance pays part of it, I more than likely can afford more of it. Bear in mind, insurance aids in payment and rarely covers 100%, so be aware of that. There’s going to be few exceptions. The idea with insurance in, hopefully, you’re going to get more new patients. Think of it. People are more likely to try acupuncture when they have coverage.

My wife is a school teacher. Most of her friends now seek acupuncture and the sole reason, they realize they have a benefit for it. Once they realized they had a benefit, that’s what made them try it. Once they tried it, then they said, “Oh, my goodness! This works really well.” I want to have a person that’s more likely to try it because they have coverage, but here’s something else to keep in mind. You are not required to bill insurance. That’s a common fallacy that people think, in order to access insurance, you have to bill it. You could have a rule where you say, I will give you a receipt or a so-called superbill, and then the patient turns this receipt in to their insurance to get reimbursement.

Certainly, that’s still a way of accessing it, but I would say be careful. If you have someone with a very good-paying plan and your visit is $100 and they come in three times a week for a month, that means they’re paying $1200. How many people can afford to pay $1200 in one month? What if that insurance is a good-paying insurance? Maybe it pays $80 a visit, 80%. I would certainly accept that insurance, have the patient come in, pay my $20 copay, and I’ll wait for the check for $1000 at the end of the month as opposed to the patient because, as a business, I can have accounts receivable where a patient wouldn’t be able to afford that. That’s on a good-paying plan.

What if you have a plan that only pays $25 a visit? Certainly then what I would explain to the patient is, “We will bill your insurance. The service is $100. Your plan is only going to pay $25. Therefore, I will bill your insurance. I’ll receive the $25, but you have to pay me $75 today.” In other words, the patient’s understanding that they’re still paying out of pocket. The bottom line is, with insurance, one thing to be careful of, it’s not more money per visit or service, but equal. Think of it in this way. I want insurance to aid your practice by getting more patients, not more money. It should be the same.

Very few states allow you to actually offer some type of cash discount, so don’t get caught up in that. If your service is $100, I want to get paid $100 whether the patient pays me or whether the insurance pays part of it. Bear in mind, it’s still going to be equal. You can’t charge more just because it’s insurance. The bottom line is more patients, and they’re more likely compliant. All of you have probably had a patient with insurance. You’ll notice when you recommend the number of visits, they’re likely to be more compliant.

The average person will most often seek care when they have coverage. Therefore, it’s important to know that, when this patient comes in, I want to make sure that I know what the coverage they have, is it a good one or a bad one? What I would do is keep a list. When someone comes in with a good plan, note it down. What codes did they pay for? How much did they pay? When someone comes with the same plan, I therefore know, “Oh, this is a good one.”

Conversely, when someone comes with a plan you know doesn’t pay well, and I’ll use the company American Specialty Health. That’s a managed care HMO type policy for acupuncturists. In most states, it’s either a discount or it pays $40 a visit. Now $40 a visit for an acupuncturist may not be enough to satisfy your needs for your business, meaning if you spend an hour with the patient, could $40 really work? That’s something to consider if you’re going to receive a payment from insurance and it’s very limited, maybe that’s a plan you’re going to say, “I do not take it.”

Here’s what I want you to think of. As a provider, you have the right to choose which plans you bill or accept. In other words, I have two patients. One has a very good policy. One has a very poor policy. I can accept and bill the insurance on the patient with the better policy. On the other policy, I could simply say, “I’m sorry. I don’t bill this insurance.” I think all of you have experienced this and Marilyn. I know I have. The medical doctor I go to does not accept all insurances, and I bet most of you listening have probably seen that same experience. All doctors do not accept all plans. You’ll notice hospitals do the same thing. Therefore, there’s nothing wrong with you cherrypicking what plans pay better than others.

Don’t be afraid to take only a handful. I would certainly rather take a handful of ones that can pay me than to take none. In other words, I’m going to take plans that pay me. Plans that don’t pay me, I don’t. Accepting insurance or making a statement that you accept insurance does not require a provider to accept or bill all plans, but you may choose to bill certain plans, so be selective. You do not have to do them all. You have the right to participate in the plans you select. You could say, I want to belong to American Specialty Health, but I do not want to belong to OptumHealth. That is your choice.

What I suggest is, take a good look in your area. See where your patients are coming from. How many of them are at a higher income that can afford to pay cash? How many are blue collar that have maybe insurance? We have to understand how it works. One of the things, of course, that we have now is, because of the equality provisions of the Affordable Care Act, it’s opened the doors for many people to get acupuncture because now you can no longer discriminate an acupuncturist. In other words, when a policy covers acupuncture, it can no longer say, I cover it only by an M.D., so it’s your right to be selective.

The ability for a provider now to no longer be discriminated has made a big difference. In states such as New York and New Jersey, this has opened the door for acupuncture to be paid because no longer can they make the discrimination that says, “We pay acupuncture done only by an M.D.” This change has made a big difference. Realize acupuncture has become a very important factor among healthcare. Therefore, I think it’s an exciting time for acupuncture, wouldn’t you say, Marilyn?

Marilyn Allen: I agree. Probably more so than any other time. They’re in the right place at the right time.

Dr. Sam Collins: I’ve been among acupuncture now and teaching seminars since 2000. You’ve been much longer. What would you say has probably been one of the most exciting things you’ve seen recently for the practice of acupuncture?

Marilyn Allen: Probably the fact that there’s a set of codes for traditional medicine going to be included in ICD-11, which is being formulated now. They said it’s going to be in their own language, and they will be able to diagnose liver qi stagnation.

Dr. Sam Collins: Wait a minute. I did hear you say something that kind of piqued me. Obviously, most of you are aware we switched to ICD-10 last year. Bear in mind, Marilyn and myself actually attended a conference in Japan recently where they’re doing ICD-11. You may say to yourself, “Oh, my goodness? ICD-11? I can’t believe it. Here’s the thing. In the world, they’ve been using ICD-10s for about 20 years.

Marilyn Allen: We’re just a little behind.

Dr. Sam Collins: We’re a little behind, but the exciting part for me is, what’s changed is, the world is recognizing traditional medicine and its effect and how well it accomplishes the goals that are set up under the care, so much so they’re creating a full chapter. In ICD-11, they’re going to be diagnoses that are traditional. In other words, Marilyn said, liver qi stagnation, blood stagnation, or just simple qi stagnation will now be codes in ICD-11. That’s going to happen in the world in 2018. Will the United States adopt that?

Marilyn Allen: It will probably make it easier for the United States to adopt it because they’re going to, I believe, in the Western codes, they’re going to … There are so many now in ICD-10. There’s going to be less in ICD-11, and they’ve also figured out that you can cluster diagnosis. In acupuncture, you already use patterns, so it is going to be a job in the World Health Organization. We’ll just see how it goes in the United States.

Dr. Sam Collins: I’m certainly excited for that, but you know what I’m excited for that’s occurring now is the acceptance and understanding of acupuncture, that people that understand it are coming in more, that people who don’t understand it, though, are giving it a chance because now they may have a benefit. The key factor to making your practice successful are patients. Our job is to make sure that you understand all those aspects, whether it’s a cash patient. What can you do?

We’re going to do further programs like this that will go into a lot more details, but we wanted to start today with just really kind of giving an overview to get you started, to say, “Where might my patients come from? How do I understand them?” How can they learn more about this, Marilyn? Where are you teaching? What are you doing?

Marilyn Allen: I’m teaching somewhat around the United States, but I teach a lot of classes in California. Sam teaches all over the United States. I want to say to you, how do you start to build your practice? I think the number one word is talk. Everybody I’ve talked to recently says, “We just have to talk, talk, talk.” I think we need to begin to look at a common phrase that begins to discuss acupuncture, and CCOM has put together a PR committee, and that’s going to be going forward. I would encourage people if you have questions or you want to talk about things, give us a call. Use us as a resource because we’re here, and we want you to be successful.

Dr. Sam Collins: That’s really our goal is to make you successful. Our business is malpractice. We sell malpractice coverage, obviously under the guise of American Acupuncture Council, and please be aware, there’s going to be some significant changes to the types of policies you can purchase. That’ll be covered at a later time. However, you’re going to see some changes that are allowing acupuncturists to be more in the traditional sense. In addition, though, I work with a group, the American Acupuncture Network. We do two things to help you. Number one, we teach continued education seminars. These seminars are intended to make sure that you have the latest and greatest information.

I’m sure many of you listening may say, “Well, we switched from ICD10. Did the codes just change?” Be aware they did change. ICD-10 had some updates in October, so therefore that’s going to be some changes that have happened which means everyone updates towards that. That’s what we teach. We also teach just simple things, how to verify insurance, how to make sure to bill it properly. What is a 1500 form? What codes do I use? What’s appropriate? What’s not appropriate? We also go over what your fee should be. Most acupuncturists have a difficult time understanding, what is a fair fee? You know what’s a fair fee? What someone will pay you and make sure there’s just an understanding of the value to it. I find often acupuncturists undervalue their service.

Marilyn Allen: I would agree.

Dr. Sam Collins: I think patients often perceive if you’re overly cheap that the service is not as good, so be careful of being too cheap.

Marilyn Allen: That’s right. It’s called perceived value.

Dr. Sam Collins: The perceived value. Our goal is to help you do that. You can take a look at our website of the American Acupuncture Council for the network. Take a look at our upcoming seminars. More important, we want to make sure that you have access to us. Take a look at these videos. There’ll be many coming your way. If you have suggestions, we say please send your suggestions along for any topics you’d like to hear, but our goal is to make sure we’re an asset to your office. We’re your team. Your success is our success, and that’s what we wish for all of you throughout now and through the new year. God bless you all.