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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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6 comments on "Sermo Wars with AMA Over CPT Codes"


Ira Kasper M.D, (7/15/2009 at 5:44 PM)
Are there many who remember what medicine was like before Medicare? I don't mean the lack of modern technology or the lack of our new medications. I mean when hospitals were not corporations. When hospitals ran banquets twice a year to make up for their losses. No one died in the street for lack of care, despite what the liberals tried to say. The only thing that has come out of Medicare is increased expenses, a more centralized government, hospital corporations, a trillion dollars going out of medical care to Wall Street, and massive debt. Many years ago I spoke to someone connected in Washington about funding research in endovascular surgery to save billions of dollars from the Medicare budget. I was told right there that no one in Washington cared to save money, they just wanted to control more of it. I doubt if nationalized medical care can be stopped and I know the AMA is not our friend.

Bruce Landes MD (7/14/2009 at 11:15 AM)
I'm impressed by the thoughtful responses here. I have many thoughts about the AMA and its relationship to American physicians. As the president of a 1400+ member physician-operated IPA I have to say there is no possibility that I can represent the thoughts of all of our members, so this is my personal opinion. I agree, if physicians don't know that selling CPT is a major revenue stream for the AMA, then they have probably been paying more attention to the most important thing, their patients' needs. I do have a problem with CPT and E&M coding. Unless they are using a computer template (which is also a risk for "fraud") it is nearly impossible for a physician to fulfill all of the CPT criteria for a given E&M code. The last study I saw (in 2002) showed that three professional coders looking at the same charts would agree less than 25% of the time on the level of the applicable CPT E&M code. If the diagnostic criteria for a disease were so ambiguous, the criteria would be abandoned. This creates a field day for the RACs or private insurers to audit a practice and find "coding fraud". The finding of so much "fraud and abuse" creates a bully pulpit for politicians to imply that we can save a lot of money by the elimination of "fraud and abuse". Our attorney and our accountant charge us for time spent on our needs. It does not have to be "face-to-face" time. I'm also pretty sure they don't meet "face-to-face" with 25 or more clients a day and document each meeting in a legal record and categorize each meeting with 5-digit codes. I know about the 50% counseling rule which is underused and I think the AMA should have set up separate code sequences for evaluation (diagnosis) and for management, to be criteria-based and to be time-based respectively. So I do agree that CPT is seriously flawed, and I don't know how many have challenged the AMA on the flaws. The AMA could do much more for its members and its primary care physicians in particular by restructuring the E&M codes to reflect the true priorities of non-procedural medicine today, which are far more skewed toward management than diagnosis. The fact that the AMA receives money from licensing CPT is much less relevant to most physicians than the fact that CPT E&M is a flawed product.

Walter Rohloff, MD (7/13/2009 at 7:38 AM)
Hats off to Dr. Palestrant ! Dr. Palestrant was correct to point out that the AMA does not represent the majority of physicians practising in the USA. As widely known, a majority of USA physicians are in support of the introduction of at least one universal insurance option, while the AMA has opted once more against the public and the true physician's interests by coming out against universal health care. Universal Health has become the pervasive reality in many countries, an overriding success where ever it has been started. Once adopted in any country, it lead to improvement of costs and quality of care delivered. Income of physicians may be somewhat lower but not necessarily as Great Britain has shown. The AMA, forever fearful of its waning influence, holds againg tight to an outdated health care delivery system. It is time for an alternative representation to emerge similar to the "Marburger Bund" that formed in Germany in response to a "German Physician Chamber" that become focused solely on their own benefit. SERMO with its true encouragement of physician voice interchange on any subject in the national arena may be the building block on which some desperately needed alternative to the AMA may emerge.