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

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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
 
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
 
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.
 
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Sorry to disappoint you...

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

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.
 
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Dr Mark Botwin asks a question...

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


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."
 
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."
 
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!"
 
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.
 
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
 
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
 
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"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!"

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
 
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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

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.
 
I'd be especially interested in that last part.

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??
 
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.

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.
 
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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??

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.
 
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.
 

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

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.
 
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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A question sent to me by an OD

Dr Perry Lieberman of Canton Ohio asked me to copy his question...


"Why OD"s can't get increases in reimbursements during the last seveal years while VSP improves their profits?"
 
Dr Perry Lieberman of Canton Ohio asked me to copy his question... "Why OD"s can't get increases in reimbursements during the last seveal years while VSP improves their profits?"

Has VSP increased its "profits?" Is that a fact, or just a bitching point?

I suspect reimbursements will increase only when large numbers of docs leave a plan due to reimbursement levels. As long as they have all the providers they need, why should they?
 
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.

VSP says they an insurance company. They mentioned this 3 times in the interview. Why then does VSP not adopt current CMS guidelines as opposed to making up their own definitions of CPT codes. Should you not be held to the same standard of other insurance companies as well as medicare?




Editor's note: This forum is meant for direct questions to be addressed by VSP senior executives. It is not fthe place to offer opinions. You can expand your thoughts in a dedicated VSP topic in the State of Optometry Can you re-phrase your two paragraphs into succinct questions that can be answered, Thanks.
 
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1). What would be required for VSP to start using a-codes rather than improperly using 92 codes?

2). If they are going to refer to themselves as insurance, are they going to hold themselves both to the standard of CMS guidelines or the authority of the state insurance commissioners?
 
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?
.

This question is irrelevant to VSP since it is Cigna who is refusing to directly credential ODs.

There are less than a handful of states which prohibit Cigna & Aetna from doing this, two of them being TX and SC.
 
This question is irrelevant to VSP since it is Cigna who is refusing to directly credential ODs.

There are less than a handful of states which prohibit Cigna & Aetna from doing this, two of them being TX and SC.

On the other hand, if a national optical chain advertised "our Optometrist Dr. James Harper" in advertising and then gave a number to call and optical employees booked my appointments, I would be told that either the optical company changed the way they did business in Texas or I and the optical would be held responsible for the violations.
If the optical company refused to change their policies, I would have to severe my relationship with that company.
 
On the other hand, if a national optical chain advertised "our Optometrist Dr. James Harper" in advertising and then gave a number to call and optical employees booked my appointments, I would be told that either the optical company changed the way they did business in Texas or I and the optical would be held responsible for the violations.
If the optical company refused to change their policies, I would have to severe my relationship with that company.

Your example pertains to the TX Optometry Act whereas Cigna/VSP pertains to the Texas Insurance Code.
Yes, Dr . Harper must answer to TOB & Cigna must answer to the TX Insurance Commissioner.
Insurance companies respond quicker to Insurance Commissioners than thst of ODs, TOA and TOB.
 
An Anonymous Poster asks...



"Please explain how VSP can justify reimbursing California optometrists 19.7% more than optometrists practicing in Texas, or in any other state, for performing the same eye examination (including dilation).

VSP is exhibiting geographical discrimination among providers practicing outside of California which is unacceptable.


Example:

VSP Allowed Amount (Brown County, TX) VSP Allowed Amount (Seaside, CA)
------------------------------------------------- = ------------------------------------
Medicare Allowed Amount (Brown County,TX) Medicare Allowed Amount (Seaside,CA)

(Brown County, TEXAS 43.9%) DOES NOT EQUAL (Seaside , CALIFORNIA 59.0%)

Note: Please refer to your Algebra I book under Ratios and Proportions.


If VSP’s methodology was fair as Medicare, the VSP-to-Medicare ratio of Texas optometrists would be equal to the VSP-to-Medicare ratio of California optometrists. Therefore, optometrists practicing in Brown County, Texas would be receiving $80.78 rather than $67.50 for performing an eye examination which includes dilation.


How Medicare Reimbursement is Calculated

Each CPT® code has a Relative Value Unit (RVU) assigned to it which, when
multiplied by the conversion factor (CF) and a geographical adjustment (GPCI), creates the
compensation level for a particular service. The Relative Value Unit (RVU) consists of Physician work RVU, Practice Expense RVU, and Malpractice RVUs.

Geographic Practice Cost Indices (GPCI) - Geographic Practice Cost Indices account for the
geographic differences in the cost of practice across the country. CMS calculates an individual GPCI for each of the RVU components -- physician work, practice expense and malpractice.
GPCIs are reviewed every three years.

How VSP Reimbursement is Calculated

Behind CALIFORNIA closed doors.
 


"Please explain how VSP can justify reimbursing California optometrists 19.7% more than optometrists practicing in Texas, or in any other state, for performing the same eye examination (including dilation).

VSP is exhibiting geographical discrimination among providers practicing outside of California which is unacceptable.


Example:

VSP Allowed Amount (Brown County, TX) VSP Allowed Amount (Seaside, CA)
------------------------------------------------- = ------------------------------------
Medicare Allowed Amount (Brown County,TX) Medicare Allowed Amount (Seaside,CA)

(Brown County, TEXAS 43.9%) DOES NOT EQUAL (Seaside , CALIFORNIA 59.0%)

Note: Please refer to your Algebra I book under Ratios and Proportions.


If VSP’s methodology was fair as Medicare, the VSP-to-Medicare ratio of Texas optometrists would be equal to the VSP-to-Medicare ratio of California optometrists. Therefore, optometrists practicing in Brown County, Texas would be receiving $80.78 rather than $67.50 for performing an eye examination which includes dilation.


How Medicare Reimbursement is Calculated

Each CPT® code has a Relative Value Unit (RVU) assigned to it which, when
multiplied by the conversion factor (CF) and a geographical adjustment (GPCI), creates the
compensation level for a particular service. The Relative Value Unit (RVU) consists of Physician work RVU, Practice Expense RVU, and Malpractice RVUs.

Geographic Practice Cost Indices (GPCI) - Geographic Practice Cost Indices account for the
geographic differences in the cost of practice across the country. CMS calculates an individual GPCI for each of the RVU components -- physician work, practice expense and malpractice.
GPCIs are reviewed every three years.

How VSP Reimbursement is Calculated

Behind CALIFORNIA closed doors.

You TX folks get a lot more than we do in OH.
 
Jim McGrann President of VSP Vision Care answers questions

Jim McGrann is responding to some questions today with more answers to follow tomorrow.

For clarity the questions are italicized and the answers highlighted.

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

Thank you to Dr. Hlis for contributing to this question, your response is spot on as this is not a VSP issue. This is a Cigna decision regarding how they want to implement their panel.

2. Why profits being a VSP provider have shrunk while VSP's profits have climbed?

During the last 10 years, VSP has increased the total payments to doctors by 8.4%, while also adding 1,000 new doctors to the network panel each year. It is important to remember that nearly 90% of VSP's top-line revenue goes back to VSP doctors through exam fees and materials. That is a huge difference when you compare VSP and to our competitors.

Also let me set the record straight that VSP does not set the pace for reimbursements, the marketplace does. For us to have a chance at winning a contract and driving those patients to the VSP network, we have to be competitive. A benefit manager, the one that decides which vision care plan to offer to employees, is using price as a key factor when selecting which vision plan to go with. A vision care plan's contract is based on price, and the majority of that price is based on doctor's fees. It is difficult for VSP to compete against other vision care plans offering lower professional service fees to doctors and passing those savings along to clients, especially when those fees are as much as 20-30% less. Because of that, we are constantly looking for new opportunities to create financial benefits for network providers outside of the standard service fees, like what we are doing with Premier.

3. Have VSP employee and management salaries not gone up in 10+ years as doctor reimbursements haven't?

See answer above

4. Why do you pay doctors different exam fees in different states?

We have more than 30,000 VSP Network Doctors across the U.S. and one size does not fit all when it comes to reimbursement. VSP calculates provider reimbursement on an individual basis taking into account a variety of factors including geographical differences and provider U&C fees. Because of that, each provider receives their own VSP Assigned Fee Report with their individual VSP reimbursements.

5. If they are going to refer to themselves as insurance, are they going to hold themselves both to the standard of CMS guidelines or the authority of the state insurance commissioners?

We do - I talk about this in the interview. Was there something specific that you are asking that wasn't clear?

6. The randomness (or lack thereof) of audits - are they targeted? Random? Something in between?

The key point I want to make sure gets across is that there is NOTHING random about the audits. As I discussed in the interview, there are several potential audit triggers. One is a utilization and billing review. Anomalies or outliers are identified and, if necessary, audits are conducted to verify whether or not mistakes or misleading billing has occurred. Another is by referral. In many cases, someone makes an allegation against a provider. However, VSP's Special Investigative Unit does not audit based on allegations alone. The appropriate time and steps are taken to verify or dispel any allegations before an audit is conducted.

The key to avoiding or working through an audit successfully is to fully document the examination, diagnosis, treatment and all materials provided to a patient. Documentation is the key. In fact, many of the audits conducted by the Special Investigative Unit result in no-action against the provider.

It is important to remember that there is no bigger advocate of VSP's Network Doctors than VSP's audit department. Audits are done to help ensure that provider's engaging in misleading billing do not have an unfair advantage over the 99.9% percent of honest providers out there.

7. Can VSP speak to how much is recovered each year in restitution and penalties, and what a clinician might reasonably expect if they are found non-compliant?

We estimate that from a low of 3% to a high of 10% of our total claims cost each year is lost to fraud. We recover significantly less than even the 3% number.

8. 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 practice may have made. Is this the case?

This is impossible. We realize that honest mistakes can be made which is why our audits are set up to ensure a focus only on prevalent and prolonged patterns of abuse. As I noted previously, many of the audits conducted by VSP result in no-action against the provider. I can't reinforce enough that documentation is the key.


 
I suspect they set their reimbursement rates based on a combination of prevailing charges, a doctor's individual charges, cost of living, and what the market will bear.

If VSP bases its reimbursement rates on the highlighted statement above, rates would be tremendously higher. Medicare is the most accurate means in determining prevailing charges, doctor's individual charges and cost of living.

"What the market will bear" in my opinion, means What is VSP willing to pay ODs in order to make windfall profits for itself, at the expense of ODs.

The market WILL bear a 10-year increase in wholesale Marchon frame prices, VSP laboratory prices and OfficeMate Annual software maintenence increases. However, a doctor's professional salary must be stagnant?
Compare VSP's 10-yr profit margins against VSP private practice ODS and there is your proof. Don't forget to include optical laboratory and frame mfr profits.

Mr. McGrann's answer is Spot-Off to question #4 because it fails to support the Ratio and Proportions thread below. If VSP's reimbursement fee schedule was truly representative to the heartbeat of American ODs, ratios would be proportionate (50/50) among the United States....PERIOD.

I would like to see VSP reimburse ODs at CMS (Medicare) fees while being competitive in the area of frame & laboratory prices. Market conditions cannot be an excuse for an optometrist receiving less money for professional services than my wife's hairdresser.
 
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Does VSP solicit reviews of providers from subscribers? If so, is this available to providers? And if so, do reviews play any role in triggering VSP audits?

Is there any tangible patient benefit when doctors check VSP boxes that patients are hypertensive, diabetic, have hyperlipidemia or diabetic retinopathy? Checking these boxes in 3 of 4 instances is probably based on whether a patient is taking medication that indicates the condition. How is this actually applicable to client (a company) of VSP? What actual good does the checked box do other than make VSP look artificially important?

Do you think that VSP should be billed, as opposed to medical insurance, for patients who are followed annually or more often, for diabetic retinopathy?

What was the impetus for limiting the ability of doctors to balance bill patients for contact lens evaluation fees? Why not let the market settle that aspect of contact lens fitting?

Thanks for taking the time to be here and to answer questions. -Charlie

Charles McBride, O.D.
Beaverton, OR
 
I've got to say, this is the dumbest idea... to think that we can ask a question here, give him a few days, and get a written response, and think you'll get a meaningful responsive answer. Without the ability to engage in follow-up, and the ability to say, "that's evasive, you didn't answer the question," you'll get nowhere and nothing but company advertising.

I know at least one thing he said about audits is simply untrue. But I'm not going to engage in a pissing match. It's pointless.

All this is is a sales-pitch opportunity for VSP to feed us it's canned BS and see if we'll eat it or not. Stupid.
 
On the other hand...

I've got to say, this is the dumbest idea... to think that we can ask a question here, give him a few days, and get a written response, and think you'll get a meaningful responsive answer. Without the ability to engage in follow-up, and the ability to say, "that's evasive, you didn't answer the question," you'll get nowhere and nothing but company advertising.

I know at least one thing he said about audits is simply untrue. But I'm not going to engage in a pissing match. It's pointless.

All this is is a sales-pitch opportunity for VSP to feed us it's canned BS and see if we'll eat it or not. Stupid.

Jim McGrann is not on trial. He is taking the time to put himself out there to offer the VSP point of view. Would the alternative shown by other Vision Care Plans of no response whatsoever by leadership, be desirable?

Our readers have a choice to accept,reject or totally avoid this topic. The 30,000 VSP network providers signed contracts to take advantage of VSP marketing to bring patients into their practice.

As a courtesy they should listen to the VSP explanation. If unhappy, don't sign up to play by the VSP rules when your contract expires or when new initiatives are proposed by VSP.
 
An Anonymous Poster comments...



"Mr. McGrann,

The Ohio Optometric Association presented VSP with a study years ago that proved the cost of living, the market, what OD's charged, etc was identical to other states.

Yet, Ohio is still at the low end of the totem pole.

Why? You explanation is flawed."
 
Jim McGrann is not on trial. He is taking the time to put himself out there to offer the VSP point of view. Would the alternative shown by other Vision Care Plans of no response whatsoever by leadership, be desirable?

Our readers have a choice to accept,reject or totally avoid this topic. The 30,000 VSP network providers signed contracts to take advantage of VSP marketing to bring patients into their practice.

As a courtesy they should listen to the VSP explanation. If unhappy, don't sign up to play by the VSP rules when your contract expires or when new initiatives are proposed by VSP.

My point is that anyone that expects to get a meaningful answer to an "argumentative" question is fooling themselves.

He's not taking the time to put himself out there for OUR benefit or yours. He's doing it because there is something in it for VSP. VSP has been creating cathartic opportunities for ODs for a long time. This is just another. EyeMed took the time to answer questions on Gary Gerber's radio show, LIVE, but all they did is fill the "air" with company talking points. That's all you'll get here and nobody should expect anything more.

The bolded comment above is the VSP company line. But it belies economic reality, and LAW. So, are you saying, if a company offers you a take it or leave it contract that contains ILLEGAL terms, your business is economically 35% based on that company's business, you should walk away? Are you not being put in a LOSE-LOSE position by that proposition? Agree to illegal or unfair contract terms, or close your business down? Is that a fair way for a company to do business?
 
Is that a fair way for a company to do business?

No, and the problem is much bigger than that. This isn't just the way they do business, this is a CHANGE in the way they do business and that's a big sticking point. It's not like this is a new entity that people can take or leave, but rather as you allude to, they have to take it or lose a significant portion of their patient base built on the terms of the OLD business model.

It's like being married for 20 years and building a life and the spouse decides to take up cheating on you. Yes, you CAN divorce them (and rightly should), but it's so much more complicated than just walking out the door and the presence of that choice to divorce doesn't mean the cheating spouse is somehow excused in their behavior because the relationship has already been established.

If this contract change and business model was something only NEW practitioners had to choose, that would be different, but that's not the way it is.
 
This is just another. EyeMed took the time to answer questions on Gary Gerber's radio show, LIVE, but all they did is fill the "air" with company talking points. That's all you'll get here and nobody should expect anything more.

I disagree. You may not realize this, but we've been talking to VSP for over three *years* to try to get them to come onto the site and engage with members. (yes, years.)

If they were just coming to spew talking points, they would have started doing it here a long, long time ago.

I take Jim's word at face value -- he said he wants to engage with members, and has even offered to take conversations offline (ie, on the phone) to make sure that he answers everyone's questions.

And from the looks of the questions that are being submitted, there are basic issues that many folks don't know the answer to. (ie, the nature and frequency of audits, how reimbursement is determined, etc..) People may not like the answers, but isn't it better to try to clear the air than to leave people guessing?

Where else can rank-and-file ECPs directly and anonymously (if need be) engage C-level execs at an insurance company -- and get a response?!
 
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