#30: VSP Vision Care President, Jim McGrann (part 1 of 2)

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  1. AdminWolf

    AdminWolf Site Administrator & Tech Lead
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    In this episode, Paul and Adam get the chance to chat with Jim McGrann, the President of VSP Vision Care.

    In Part 1 of the interview, we talk about VSP's history, their policies, audits, and how the company is positioning itself as the Affordable Care Act unfolds.

    Please leave feedback about the show in the discussion thread below. Jim is very hands-on, and will attempt to answer any questions you might have about the company.

    Enjoy!

    Adam
     
  2. AdminWolf

    AdminWolf Site Administrator & Tech Lead
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    Thanks

    Thanks again to Jim for taking the time to speak with us; I know everyone has a ton of follow-on questions that they'd like answers to, so please post 'em here.

    ad
     
  3. #3 Nov 14, 2013
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    James Harper

    James Harper ODwire.org Supporting Member

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    Please ask Jim McGrann to address the issue of blocking non-VSP docs from participation on the Cigna Medical panel.

    Is this issue is considered out of bounds in these interviews?

    Editor's note: There are no "out of bounds". You have asked a question. I hope it will be addressed.
     
  4. mark botwin

    mark botwin ODwire.org Supporting Member

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    I'm sorry Paul and Adam, you disappointed me. Kinda like listening to Bill O'Reilly interview Newt Gingrich.







     
  5. #5 Nov 15, 2013
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    Paul Farkas

    Paul Farkas Administrator

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    Sorry to disappoint you...

    What questions would you have liked us to ask? We requested questions from our supporting members two week prior to the interview. These were the questions they came up with.

    It's not too late to pose questions and comments.
     
  6. Paul Farkas

    Paul Farkas Administrator

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    Dr Mark Botwin asks a question...

    This copied from another topic...

    Dr Mark Botwin wrote

    "I think there are 2 threads addressing the interview. I was really disappointed with Paul and Adam. Like I said on the other thread, it was like listening to Bill O'Reilly interview Newt Gingrich. Ask the tough questions and follow thru. Leave the dancing around to Mohammad Ali.

    You know, I really didn't want to get into this but since you asked, I would like to know why our profits being a VSP provider have shrunk so much while your profits have climbed? I have been a VSP provider for 30+ years and have seen increasing intrusion into our practices.

    Now you compete directly against us online for eyeglasses and contact lenses. Why? How much profit did VSP make last year? Why do you pay doctors different exam fees in different states? If your an "insurance company" as you stated 3 times during the interview, why don't you accept ICD9 codes other than refractive codes? Why don't you accept the CPT definitions of 92 and 99 codes?

    Thanks for listening."
     
  7. Anonymous Post Bot

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    An Anonymous Poster writes...


    "I for one am glad there is such a person as Dr. Steinberg to be there to stand up to their bullying tactics. Speaking as an Asian optometrist I can say that there definitely is a difference between Asian patients (and that includes East Indian patients) vs. Caucasion patients.

    I believe it's a cultural difference in that in Asia and India it's common to try and bargain for better deals when buying products and services and that includes eyecare and eyewear. There are essentially no ODs in Asia where opticians perform refractions and sell eyeglasses. Vision insurance is pretty much non existent in Asia also.

    When Asian or Indian patients consistently ask for special discounts or deals it's up to the OD to be strong and resist and not cave in to their requests. As whole families become friends with the OD they may ask for us to do something that is not permitted. A huge mistake is made on our part if we agree to even one request because then they will ask for another favor and tell their relatives and friends about the break they got and will expect it the next time.

    It's up to us to resist giving in to these requests but some ODs will give in and go down that slippery slope from which it will be difficult to reverse course. In a better world ODs would be reimbursed fairly and can easily not give in but in a struggling economy and oversupply of ODs and opticals some ODs have a hard time making ends meet and break the rules unfortunately.

    From talking with a number of employed ODs (OD owners are not as willing to be as forthright as employees) I've learned that quite a bit of practices break the rules by for example ordering RX lenses and replacing them with pl lenses for sunglass frames. Once an OD gets a targeted VSP audit and gets terminated by VSP, pays a huge fine and possibly lose their OD license after VSP reports them to the state board that OD's professional life is essentially finished.

    In my opinion the punishment is overly harsh compared to for example a lawyer who gets sanctioned by the state bar for breaking the rules. The lawyer may pay a reasonable fine of say $10,000, be on parole or have their license suspended for a year but is allowed to practice again. But a lawyer is able to practice as before whereas an OD terminated by VSP in a heavily VSP dominated area has to close up their practice or sell it.

    My question to VSP is do they honestly believe the six figure fines they are forcing ODs to pay reasonable and accurate amounts? It seems in other instances of fraud the guilty party is made to pay the amount that was actually in question or double that amount. In VSP's case I believe they are demanding about ten times or much more than ten times the amount in question by using a formula that they know are skewed to their advantage.

    To select say 100 files to audit from an office that they believe were fraudulent or improperly billed and find that 70 of those files contained improper billing and then to extrapolate that and say that 70% of ALL VSP claims filed by that OD must be fraudulent is simply not accurate and VSP knows it.

    The 100 files that they targeted are not random sampling of files but targeted for the audit.
    In my opinion VSP is using this formula to reap as much money from these ODs as possible and in the process ruin their lives.

    I know many ODs reading this may say the ODs breaking the rules deserve everything that they get. They are entitled to their opinions and I respect that.

    In my opinion the penalty far outweighs the crime in the cases that VSP are handling. I personally don't believe in karma but in the case of VSP, I hope that if any member of VSP leadership ever breaks any law or rule in their lives that they face an equally harsh penalty as they are dishing out to ODs."
     
  8. Anonymous Post Bot

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    An Anonymous Poster writes...

    "Craig writes:

    "You people at VSP amaze me truly amaze me. I'm out there trying to encourage compliance with your rules, and I get harassed and threatened for it"

    I'm trying to put myself in VSP's shoes. VSP has two ways of handling ODs committing fraud. One way is to flag several suspicious claims and at the earliest opportunity bring it to the Dr's attention and request repayment and tell the Dr about the serious consequences if they continue with their actions. That way VSP can nip the problem in the bud before it gets any bigger.

    The other way of handling it is to do a targeted audit and demand repayment of several hundred thousand dollars from EACH OD it audits. The OD either pays the "fine" or faces criminal prosecution and possible prison time.

    When Craig tries to alert other ODs what VSP is doing and to tell ODs not to break VSP rules or else face the severe consequences that he describes it's understandable that VSP would get very upset because Craig is playing a role in VSP potentially losing out in collecting untold millions of dollars that it could have otherwise collected from ODs had it not been for Craig.

    I too would be upset at Craig if I were VSP for him to try and ruin the lavish perks of working at VSP and the high pay of its executives.

    The nerve of Craig!"
     
  9. Craig Steinberg OD JD

    Craig Steinberg OD JD ODwire.org Supporting Member

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    Within the sarcasm may well be found a meaningful truth. I have no firm numbers, but I'd estimate that VSP brings in upward of $5 million or more in restitution each year. I believe that number FAR exceeds the amount those doctors overbilled (remember, VSP will demand repayment if you didn't document adequately, even if you did the service or actually dispensed the product). In addition, they charge for the audit generally about $5000 give or take, an amount I believe is FAR in excess of what their provider agreement allows them to charge. Also, they charge $2000 if you want to appeal an audit result, which I believe is ILLEGAL under California law and I believe is clearly done to discourage appeals. One of these days I'm hoping a client will come forth and say they want to sue VSP to recover those audit fees and hearing fees on behalf of all docs that were illegally charged.

    It seems to me the Auditing Process is a very lucrative part of the VSP business on several levels. One is as a stand-alone business itself. To the extent I help doctors comply with VSP rules, it's like the guy that puts up a sign ahead of a cop with radar saying, "Slow Down, Don't Speed", and gets arrested for doing that.

    I find it disgusting.
     
  10. Mark Flora

    Mark Flora ODwire.org Supporting Member

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    VSP reimbursements

    VSP keeps making a profit by keeping its' costs low. This allows it to sell its products (the coverage) to employers and other insurance plans more cheaply than other vision plans.

    Your reimbursement keep falling because that's a large part of VSP's cost. VSP is not going to lose profit under any circumstances they can control. They control your reimbursement.

    VSP's entrance into "medical eye care" is a way for the company to sell more coverage and "perceived value" to its customers while you provide the service (and take the risk) at a greatly reduced reimbursement. All you have to do is compare VSPs' reimbursements to that of BC/BS to realize where VSP is making it's profit.


    Consider this: patients who have VSP are employed. Many already have Medical Insurance that covers medical eye care. The patients don't need the inferior duplicate medical eye care coverage that VSP provides at lower cost because the coverage is, indeed, inferior and because you are willing to accept lower reimbursement.

    This trend in lowering reimbursements will only continue as VSP adds clients, their costs climb and as the cost of living continues to increase.


    Mark R. Flora, OD
     
  11. #11 Nov 15, 2013
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    AdminWolf

    AdminWolf Site Administrator & Tech Lead
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    Please don't use this thread as a soapbox.

    Please -- do NOT use this thread as a soapbox. It is here for people who want to ask QUESTIONS of VSP upper management, questions that they can ANSWER. It is NOT for venting your spleen.

    Please, please
    start another thread for spleen venting, preferably in the State of Optometry forums.

    Thanks

    the management

    Editor's note: There is a topic underway in the State of Optometry for those who wish to vent...
    http://www.odwire.org/forum/threads/78389-VSP-interview
     
  12. #12 Nov 15, 2013
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    AdminWolf

    AdminWolf Site Administrator & Tech Lead
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    Oy vey. I'm not going to let this thread brome a Craig vs. VSP free-for-all. They have issues with each other, they can take it to another thread. Seriously. This thread is for questions.

    What I will say is that the gist of the thread that I'm getting here is that people are still concerned about the audit process, in particular:

    1) The randomness (or lack thereof) of audits -- are they targeted? random? something in between?

    2) That restitution and penalties in the opinion of folks who have been audited -- are out-of-line with the degree of the offense. (i.e., the death penalty for jaywalking) Can VSP speak to how much is recovered each year this way, and what a clinician might reasonably expect if they are found non-compliant?

    3) There remains a concern that people who are playing by the rules (or are making a good-faith effort to) will get hit with major penalties for small administrative blunders that their practices may have made. Is this the case?

    Did I get that right so far?

    ad

    Editor's note: For those with no question but merely wish to vent their general displeasure there is a perfect topic underway in the State of Optometry Forum...
    http://www.odwire.org/forum/threads/78389-VSP-interview
     
  13. Steven Nelson

    Steven Nelson ODwire.org Supporting Member

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    I'd be especially interested in that last part. They seem to be levying HUGE fines and penalties for simple administrative blunders with complete disregard for the fact that the services were actually rendered leaving the doctor holding the bag.

    I agree that this seems to be a secondary revenue generating enterprise for them. They seem to make no distinction between administrative errors and actual attempts to defraud them.
     
  14. AdminWolf

    AdminWolf Site Administrator & Tech Lead
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    I agree completely -- I think it would do both the honest doctors and VSP a great deal of good if this issue was made completely clear.

    Lets face it: people who really, really flout their rules and do it openly and purposefully for their own gain do deserve to be piled-on -- because they raise the cost for everyone else AND are partially responsible for honest docs receiving lower reimbursements.

    I would hope that everyone can at least agree on that??
     
  15. #15 Nov 15, 2013
    Last edited: Nov 15, 2013
    Craig Steinberg OD JD

    Craig Steinberg OD JD ODwire.org Supporting Member

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    My experience has been that administrative errors arise mostly only in the context of billing the wrong date of service. Sometimes the DOS billed will be the date it was billed, not the date the patient was in. Then the auditor comes in and asks for the records for the DOS that was billed, which may be a few days off, and if he/she doesn't find records, says there were no records for THAT day, therefore you're not entitled to any payment for that visit, and THEN they extrapolate that out for 3 years.

    So, the question to VSP on that point becomes, aren't you being unfairly hypertechnical, charging doctors significant sums of money due to a simple data entry error when it is CLEAR that the services were provided? Why can't doctors simply be warned and advised to be more careful?

    The other area where I think VSP is unreasonable is the documentation issue. When doctor's didn't adequately document, for instance, the date dispensed, VSP denies payment notwithstanding that they don't dispute that lenses or glasses WERE dispensed. Again, this is an area where a warning would be appropriate, not a large restitution demand.
     
  16. Steven Nelson

    Steven Nelson ODwire.org Supporting Member

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    One small point of disagreement, I don't think it benefits VSP at ALL to clarify or change, nor do they have any real incentive right now to do so. They've managed not only to devise a system where they can "get the milk for free" to the tune of MILLIONS (which in my mind is akin to theft of services), but they're so powerful that most ODs just have to take it.

    Don't get me wrong, if someone is actually committing fraud, they should have the hammer dropped on them, but my experience tells me this isn't the norm and a lot of the "fraud" is stupid stuff like incorrectly noted dispense dates.

    I'd love to hear some commentary on those points.
     
  17. Anonymous Post Bot

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    An Anonymous Poster asks...


    "Can't the audits be a warning to all of optometry to cut out the questionable claims submission?"
     
  18. Paul Farkas

    Paul Farkas Administrator

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    An update...

    Jim Mc Grann is traveling this weekend. He passed word that there will be responses to the questions beginning this coming week 11/8/13.

    VSP senior management appears to want to have a dialogue with ODs.
     
  19. Craig Steinberg OD JD

    Craig Steinberg OD JD ODwire.org Supporting Member

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    You are presupposing that all audit results come from questionable claims submissions. That's FAR from the truth.

    I defended two audits recently, one where the auditor determined the OD owed about $130,000, and after the hearing it was reduced to about $3000, all of which was related to charging for postage when CL's were mailed. In the other the OD was alleged to have falsely diagnosed keratoconus and irregular astigmatism on a couple of patients resulting in about $50k in restitution demand. After that hearing the hearing panel reversed all restitution, refunded the audit fees, and even refunded the cost of the hearing.

    There is, in my opinion, an approach by the auditors that they are performing the audit for the purpose of finding and proving the problem they suspect, as opposed to to find out IF there is a problem. They appear to me to try and perform the audits when the doctor is not present, and they do little or nothing to enable the provider to supply the information needed.
     
  20. #20 Nov 15, 2013
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    Scott Caughell

    Scott Caughell ODwire.org Supporting Member

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    It is sad that things have changed so much. When I first entered private practice just around 7 years ago I recommended VSP to patients and mentioned how much I thought it was the best plan. Sadly I have not seen a raise in reimbursements for the entire time I have practiced. We were one of the last practices in town to accept EyeMed and are still the ONLY practice in town that does not take the embarrassing EyeMed Select plan.

    We currently only take plans that are equal to or better than VSP in reimbursements.

    While tough to come up with thought provoking questions a few that come to mind are:

    1. Have VSP employee and management salaries not gone up in 10+ years as our reimbursements haven't? I'm almost positive the employees and management have had a raise in the 10+ years we haven't.

    2. I would like the see the materials handled like the OLD EyeMed plans where we can edge in house and increase our profits while proving faster service to our patients. Why are VSP offices forced to overpay for lenses and lot allowed to order or edge from stock?

    3. What is VSP doing to encourage patients to purchase their contact lenses from the ODs?

    4. What can VSP do to reward private O.D.s who don't accept the low ball competition like EyeMed Select, Davis Vision, and Optum/Spectera? I have lost a fair number of patients to EyeMed Select as all the other O.D.s in town take it.

    5. If VSP wants us to dispense more Marchon et al. product why don't they offer significantly higher profits and lower costs on these products?

    6. Why doesn't VSP market the quality of the private practice O.D. directly to the public?

    7. Are the Walmart plans going to hold those O.D.s to the same standards, requirements, and audit threats as the private O.D.s, and will VSP make sure these practitioners aren't charging VSP more than their standard fees?

    I'm sure there are more important questions but these are a start. I think private O.D.s would love to return to a better relationship with VSP but there have only been negatives over the past few years.
     
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