Do it yourself: A personal approach to coding

By creating his own handheld computer program, family physician Andre Chen, MD, didn't just find a way to remember complex E&M codes -- he also birthed a one-person company that is giving him some extra income.

By Tyler Chin, amednews staff. May 13, 2002.

Sometimes inefficiency pays off. Three years ago, Andre S. Chen, MD, was struck by the sheer inefficiency of learning the federal evaluation and management documentation guidelines so he could bill appropriately.

The complexity of the guidelines made it impossible for him to memorize them, forcing him to use paper templates or to guess what elements he needed to document higher level E&M services. To address the problem, he decided to write handheld-based software that he could use as a handy coding and documentation reference tool.

The Chen file
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He bought some books, taught himself how to program, wrote the program, Stat E&M Coder, and then set up StatCoder.com. The "virtual" software company sells the coding software Dr. Chen created to improve his own efficiency and earns the doctor a nice chunk of change on top of his day job as a family physician at the Austin (Texas) Diagnostic Clinic, a 130-doctor multispecialty group.

"It's all virtual," Dr. Chen said. "There's no phone number, and business is all done by e-mail."

Thus far, the approach is paying off financially. Sales will reach about $60,000 this year. And because the virtual approach keeps costs -- and risks -- very low, most of that money will go directly into his pockets, Dr. Chen said.

Unlike traditional software companies, a virtual company does not need to have gobs of capital to operate, or have a large sales force or high margins to make money, said Dr. Chen, whose competitors include Medical Informatics Inc., a Tahoe City, Calif.-based company owned by Mark H. Spohr, MD, a former emergency physician. While Dr. Spohr was an electrical engineer and a programmer before he was a physician, Dr. Chen was a doctor who became a programmer.

Dr. Chen decided to do his own programming because he felt he could do a better job than computer programmers who don't understand clinical practice and don't use the software themselves, he said. The result is that their software doesn't do what doctors need, which explains why doctors are so dissatisfied with medical technology today, he asserts.

He also decided to write his own programs because it was "much more efficient to learn to do it myself" than hiring and telling a programmer what he wanted, Dr. Chen said.

Dr. Chen's initiative and business experience also have helped him reach a position of leadership at his group, influencing the practice's board of directors to name him chair of the budget committee, said William Evans, MD, a family physician who practices with Dr. Chen.

"He's unique in that he sees problems before they actually become an economic burden," Dr. Evans said. "He will see things that most of us take for granted and ignore [and do something about it]."

Problem or opportunity?

Dr. Chen said he looks to those problems as fodder for potential applications that he can write and market to other physicians.

"People like me who are in practice ... know what's inefficient because we do it every day and it doesn't make sense," he said. When he identifies a problem, he asks himself whether he can create something that makes it easier and can he "get it out there to enough people and make it compelling enough?"

After he writes a program, he posts it on medical handheld software sites, using feedback from beta testers and customers to refine it. "It took me over 11/2 years to come up with a final version [of Stat E&M Coder] I was happy with because other clinicians would send me e-mails or make suggestions," Dr. Chen said.

His advertising strategy revolves around letting users download and try his software for free for an extended period of time. He's betting that they will buy the software after they see its value and then tell their colleagues about it. "Word of mouth is very important," he stressed.

Dr. Chen also advertises his coding products by giving away handheld-based clinical programs, including a cardiac risk calculator. The programs don't cost doctors anything, but they include plugs for his commercial products, which cost $50 to $75.

Dr. Chen estimates that he spends about two hours a day on his business. "I usually come up with a new version every couple of months, making small changes based on user feedback, bug reports and new ideas."

He does not harbor huge ambition for his business. "In business school, we call this a lifestyle business. It's not going to make millions of dollars, it's not going to be a traditional company that you take public, but it's enough to support the lifestyle of one or two people. All I have to do is double the sales."

And that would be enough to satisfy Dr. Chen. "You don't need to start a company and hire a bunch of people and go public to be successful. It just has to be profitable enough," he said.

What customers say

Physicians who have purchased Dr. Chen's software say it was worth the price they paid.

"It's absolutely worth it because you get an idea of what sort of things you need to document for higher levels of service," said Morris Jenkins, MD, a family physician at an eight-doctor group in Calhoun, Ga. "I also find it to be helpful for services ... such as outpatient consultations and home-visit services that you don't do day-in and day-out so that you don't get a good feel for what level you should charge."

Dr. Jenkins paid $50 for Stat E&M Coder and said he recouped that in one week, if not in one day. He estimated that if a physician used the software for a Medicare office visit once a day, it would make a difference of $5,000 to $6,000 annually based on the $25 differential between each level of service for Medicare.

"Many doctors are frightened of using the higher-level codes because of concern of getting audited, investigated or accused of fraud and abuse, and they tend to knock the level down," Dr. Jenkins said. "This allows you to get more back with an appropriate level of coding."

Although the software was written by a doctor, that did not influence him to buy it, Dr. Jenkins said. He bought the software because it was easy to use, intuitive and fast, he said. "But it probably is very easy to use because it was written by a doctor who understands the way we look at things."

Joseph F. Meyer, MD, an internist in a 30-doctor multispecialty practice in Walla Walla, Wash., also found Stat E&M Coder useful. "Even though I consider myself quite learned regarding the ... HCFA guidelines I find it impossible to remember them all." he said.

But Dr. Meyer cautions that physicians shouldn't rely solely on the software tool because they still need to have a baseline knowledge of how to code for E&M visits before they can use it effectively.

"This program will not teach the newbie all he or she needs to know about coding," he said. But "the person who is fairly comfortable with coding and even an expert coder will find this program useful as a quick coding reminder and coding reference."

The fact that a doctor designed the software influenced him to get it, Dr. Meyer said. He also bought the software because it was "much better" than what he had before, he said, adding that he had previously typed codes in his handheld device for lookup.

He did not look at other programs because he thought Dr. Chen's product was the only one available for handheld devices when he bought it in 2000, he said. "I still use it several times a week to remind myself of what is necessary for the different levels of service and different [practice] settings," Dr. Meyer said. "I believe it has helped me document better and also code more accurately."

ADDITIONAL INFORMATION:

The Chen file

Andre S. Chen, MD, 35

Education:

BA, biology, University of Texas at Austin (1988)
MD, University of Maryland School of Medicine, Baltimore (1992)
Family practice residency, Central Texas Medical Foundation, Austin (1992 to 1995)
MBA, University of Texas at Austin, McCombs School of Business (1997)