American Physician Partners IPO. Apparently facing resistance, American Physician Partners as of Nov. 14 had cut down its initial public offering to 3 million shares at $12 to $14 per share, raising a maximum of $42 million. The Dallas-based start-up radiology PPM had originally hoped to go public the week of Nov. 3 with an offering of 5 million shares at $15, raising $75 million. APP did not comment on the offering because of SEC regulations forbidding talk about IPOs in registration. However, IPO analysts tend to view a reduction in a stock offering as a sign that investor interest hasn't been high. As of mid-November, APP planned to go public by the end of the month. (August, page 2)
Counting PPM dollars. Physician practice management companies may count all of the money member doctors receive as company revenue, the federal Emerging Issues Task Force has decided. The task force accepted recommendations from a working group consisting of accountants and MedPartners Chief Financial Officer Harold Knight. The task force, appointed by the Federal Accounting Standards Board, was investigating whether PPMs violate corporate practice-of-medicine law when they count more than their managing fees as revenue. PhyCor handles its revenue in this way, while many other PPMs have long counted every dollar their clinics receive as revenue, even the money those clinics kept for themselves. (September, page 3)
Another Medicare billing settlement. The Health Services Foundation, the group
practice for teaching physicians at the University of Virginia in Charlottesville, Va., last month reached a settlement of $8.6 million with the federal government to resolve Medicare billing issues. In February 1996, the 420-physician group initiated a voluntary self-audit of Medicare claims from 1991 to 1996. HSF then reported instances of incomplete documentation to the Justice Department and the two reached a settlement. Because of the group's initiative, HSF is now in full compliance, Executive Director William E. Carter Jr. says.
HSF also may have saved itself millions of dollars down the road. The federal government is stepping up its Medicare fraud investigations, and, under new legislation, unintentional billing errors may now be considered fraud. (November, page 3)