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Sermo Wars with AMA Over CPT Codes

Cheryl Clark, for HealthLeaders Media, July 9, 2009

It's hard to tell who's cheating, who's lying, or who kicked whom out of the house first.

But the partnership between the American Medical Association and Sermo, the online physician social-networking site, is now in tatters, with such nasty invective it now seems way past divorce. Unseemly though it may seem, all-out war with the House of Medicine has now been declared.

The rancor surfaced July 1 when Sermo founder Daniel Palestrant, MD, posted a letter to the Sermo blog headlined "The Biggest Risk to US Physicians: The AMA."

Palestrant accused the AMA of lying to cover up a precipitous decline in its membership, having business conflicts of interest and cozy relationships with health insurers "while profiting from a reimbursement system (the CPT codes) that makes it increasingly difficult for physicians to practice medicine."

All this came just a few weeks after the AMA opposed backing a public plan option, which many Sermo members strongly support.

Now, the relationship between them, in which the AMA was allowed to use Sermo to access physicians' online dialogue and "and deliver that message to the powers that be" for a health reform agenda, Palestrant says, is definitely over.

As unlikely as it may seem, Sermo is a more likely choice to replace the AMA as the legitimate voice of America's doctors, he says.

Yesterday, Palestrant topped his July 1 posting by releasing results of a Sermo member survey showing the extent of the forum's dissatisfaction with the AMA.

The survey revealed that 54% of physicians responded that they were unaware the AMA owns, maintains, and profits from sales of the complex compendium of CPT (Current Procedural Terminology) codes, which have been in use for 43 years. Doctors use the codes as a kind of universal language to categorize the value and type of their care in order to bill payers, from insurance companies to the government, in order to be appropriately paid. The 2009 edition is available on Amazon for under $90.

Palestrant accuses the AMA of receiving "approximately $70 million in 'licensing fees' from anyone who needs to use those codes. Add to that insurance companies (who pay the AMA many of those millions) who can use the CPT coding system to further their own gains at the expense of the physicians, and it starts to make you realize why CPT codes have been so conveniently left out of the current debate."

"Do you think that it is right that the AMA makes more money from selling licensing for CPT codes than it does from membership dues?" his survey asked. 87% percent of 661 doctors answering said, "No."

In his posting yesterday, entitled "Why physicians always get screwed, Thanks AMA," Palestrant wrote, "Not only do we have to maintain an extraordinary overhead of staff to submit, resubmit and document around CPT codes, the system robs the physician of any leverage we have with payors."

The AMA yesterday was just starting to recover from the broadside. Last night, it sent a six-paragraph e-mail response from AMA board chair Rebecca J. Patchin, MD, which did not mention Sermo. It read in part:

"The AMA takes great pride in the precision and uniformity of CPT and invests millions of dollars annually to revise and maintain codes that reflect the ever-changing realities of medical practice.

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