3.5
36 New in Practice 2009: What medical residents need to know before entering practice
when a physician fails to record and hand over to the billing staff the record of services performed outside the office (e.g., when on call). Many physicians scribble patient information from the hospital visit on a card, then forget to empty their purses or wallets until it is too late to submit the bill. Today’s handheld technology should make this a thing of the past.
8. Reciprocal billing: What if the pa- tient is from another province? In such cases it is essential to have the pa- tient present their valid provincial health card, and verify the party responsible for payment. All provinces and territories except Quebec have a reciprocal agreement, so you can use your billing program to submit the bill to your provincial MoH using the pa- tient’s provincial health card number. You will be paid according to the fees of your province, not those of the pa- tient’s home province.
If you work outside Quebec and treat a resident of Quebec, you have the fol- lowing options:
a. Bill these patients directly. Give the pa- tient a receipt and record of services pro- vided, and he or she can submit for reimbursement from the Régie de l'assur- ance maladie du Québec (RAMQ). You can give these patients a specific form that you can order from the RAMQ; the Application for Reimbursement – Health care services insured outside Quebec is available in English and French. The pa- tient can complete this form without the assistance of your office staff. This is the billing option most physicians use. You have the option to charge using the RAMQ, MoH or provincial medical asso- ciation fee schedule. Remember, though, if you are charging above the MoH or RAMQ fees, patients will only be reim- bursed for a portion of what they paid.
b. Submit an Out of Province Claim Form
to the RAMQ for reimbursement. This form will need to be signed by the pa- tient and sent to the RAMQ by your of- fice. You will need to record the patient's health card number and give details of the services provided. The RAMQ will pay you directly by cheque. This is not an ideal situation, as it creates extra pa- perwork for your staff and can results in significant payment delays.
c. Register with the RAMQ and obtain a billing number so you can submit ac- counts directly to the Quebec MoH, which will remit payment to you. This option is most often exercised by physi- cians who work near the provincial bor- der and see a significant number of patients from Quebec. Note that physi- cians pay annual federation dues to provide this convenience for patients. Quebec physicians seeing out-of-province patients face the same scenario and will most likely exercise option A. ⌧
Uninsured services
Fast track: Uninsured services can add up to a significant amount of the services you provide. Not charging for them can have a negative impact on your bottom line.
Many physicians feel uncomfortable billing for uninsured (or delisted) services. After all, what’s one doctor’s note here, or one phone prescription renewal there? They may not seem significant on a one-off basis, but the reality is that these “small” uninsured services can represent a significant amount of the daily activity in your practice. In many cases, physicians are not remunerated for this work. Meanwhile, the costs of maintaining a practice continue to rise.
Bear in mind that your signature rep- resents a professional opinion or en- dorsement; because you are accountable and liable for anything you sign, your signature is of value.
Point-of-service billing
Point-of-service or “as needed” billing means your patients will pay for only those services used at the time that they use them. The upside of this ap- proach is that you will receive pay- ment at the time of service, without any accounts receivable. Offering pa- tients the option of paying by debit or credit makes point of service billing very efficient and effective.
Block-fee billing
Block-fee billing is the term used for bundling a number of uninsured serv- ices together and offering one set price for the use of any of those serv- ices within a one-year period. This re- duces the daily workload on your staff and cuts down on having to ask patients for money (you will only need to ask them once per year, as opposed to with every service per- formed), as well as reducing the need for cash on your premises. There are companies that can manage unin- sured service billing on your behalf,
taking on the financial and adminis- trative burden. However, you must ensure you are dealing with a rep- utable company that values privacy and operates with integrity. Is it worth it? Many physicians feel guilty asking their patients for money. But consider the work that other health-related professionals perform. Dentists, chiropractors and massage therapists have charged patients di- rectly for their services for years. Physicians need to examine the ben- efits of billing for uninsured services. If you could generate an extra (for ex- ample) $18,000 per year by billing for uninsured services, you would be in a position to reinvest that money into your practice. Perhaps it could help you to pay for an EMR system, or to upgrade some equipment. Keep in mind that the salary stats pre- sented at the beginning of this chap- ter do not reflect money physicians earned with uninsured services. ⌧
A successful, secure
financial future requires careful consideration of seven financial planning and management areas: finance, taxation, law, insurance, wills and estate planning, investments and retirement. This chapter gives you the strategies, tools and guidance you need to get on the right financial track.You may already be looking to choose partners to help you manage your finances. These may include tax experts, financial planners, portfolio managers and investment advisors, and insurance brokers. When choosing experts to manage your financial assets, it’s important to select carefully. Look for credible companies with a solid history. Ask questions about the products they offer, track the monthly progress of your portfolios, and ask your friends, family and colleagues for advice, opinions and referrals.
Chapter 4
Financial planning
and insurance
4.1
Eliminating debt and student loans
4.2
Starting a family and parental benefits
4.3 Tax basics
4.4 Instalment payments
4.5 Investing basics
4.6 Incorporation
4.7 Estate planning
4.8
Is it better to rent or buy a home?
4.9
Protecting your lifestyle
4.10 Professional liability protection
We acknowledge MD Financial’s generosity in helping residents prepare for practice through their support of the New in Practice 2009 guide.
38
Fast track:
Know your options. Repaying debt need not be your sole focus.
Look into a TFSA account. This new savings option has benefits for everyone. Talk to an expert. You can find bal- ance between your current and future financial goals.
R
epaying student loan debt is a topic that raises a lot of questions and concerns for medical residents— and for good reason. The number of young doctors in financial peril has grown considerably in recent years. This is no surprise, considering two factors: how easy it is to get credit from financial institutions to finance a medical education, and the minimal formal financial planning education medical students receive in university. Planning student debt repayment re- quires particular care and daily disci- pline to achieve financial health.For new residents
The beginning of residency is the best time to develop a debt repayment plan outline and to consider loan consolida- tion. Once you start earning a salary, you’ll no longer be eligible for govern- ment loan and grant programs and, as a result, the amount of debt you have ac- crued thus far represents the final bal- ance owed to the government. Depending on your province, your stu- dent loan may have a grace period where you don’t have to make interest or principal payments; however, you should be aware that you may start to accumulate interest from the moment you are officially a non-student. While the convenience of consolidating debt is certainly tempting, are you sure it’s the best decision? There are many factors to look at when considering debt consolidation, and the arguments for
and against vary greatly by province and by each individual situation. Working with your financial advisor will help you to determine the best course of action. Regardless of the financial institution, interest will accrue on all lines of credit. Thus it is important to make interest payments on your line of credit in order to keep control of your financial situa- tion. If you don’t, the additional interest charges will be tacked onto the annual cost of living you previously established when making your budget. Once you complete—and more importantly, apply—an interest payment plan, you will be able to estimate (through a fi- nancial projection) the result of your ef- forts and determine whether you will be in the black or the red at the end of the year. If you continue running a deficit at the end of your first year of residency, don’t dismay, but be system- atic with your payments. In many cases you’ll end up getting a handle on your interest payments within the first three years of your residency.
Once you start seeing extra cash, you’ll have some choices in front of you. You can use all or part of the surplus to help pay down the principal of your debt. Re- ducing your balance now will lower your interest payments in the future. Add to that your annual salary increases and government grants, and you’ll have even more money available to you.
But take a moment to think about all
your options. For instance, if you take advantage of the tax savings available when you contribute to a registered re- tirement savings plan (RRSP), not only will you be able to start a retirement nest egg, you will also receive a refund or reduce your taxes owing (provided you have available RRSP contribution room). This refund could then be ap- plied directly to the balance of your line of credit. Some residents will contribute to their RRSP, but will not deduct these contributions from their income until they are earning a higher income and are therefore in a higher tax bracket. Or, thanks to the Home Buyers’ Plan (HBP), your RRSP savings may also be the key to buying your first home.
You may also wish to open a Tax-Free Savings Account (TFSA). A new invest- ment option as of January 1, 2009, this is a good option for most, if not all, Canadians at every stage of life. Whichever option you choose, once you implement and stick to a strategy, you will be in a good position to start repaying your debts in your first year of medical practice.
In practice
Just as residency is the best time to start making interest payments on your line of credit, it is also a good time to develop or update your financial plan. Ideally you will have a good financial plan in place by the time you start prac- tising medicine. You will need to deter- mine how to repay the debts you have accrued, while keeping in mind the tax and investment opportunities now available to you. Seeking help from pro- fessionals who can direct you in the various financial choices you will have as a self-employed worker or salaried physician is strongly recommended. It is important to establish a tactical plan
New in Practice 2009: What medical residents need to know before entering practice