Practice Management Alert

Explore the differences between an employee and an independent contractor.

Practices sometimes hire some aspects of their business out to other businesses or individuals. Coding and billing are often outsourced outside of the office.

Do you know which rights, responsibilities, and documents are tied to employees versus independent contractors?

Test your knowledge with these questions and then check your answers on page 5.

1. Juan is a certified professional coder (CPC^®) and has been hired by a cardiology practice to do their coding, billing, and collecting remotely. When they offer him the job, they confirm that he has his own computer, as well as the appropriate software and a private setting to work; agree on a rate of pay; and ask him to fill out a W-9 form. Is Juan an employee or an independent contractor?
2. Chloe is a practice manager for a pediatrician’s office looking to hire a CPC^®. The ideal candidate will work in the office, obey the business casual dress code for nonclinical staff, and use a computer provided by the practice. They are hoping the coder will work eight-hour shifts five days a week, even though the office is open more than 40 hours a week. Is Chloe looking to hire an employee or an independent contractor?
3. Marcia is a CPC^® who has worked for the same pulmonology practice for four years. She originally worked in an office but began working remotely in March 2020. She uses a desktop computer provided by the office and earns a salary and paid time off. Marcia can work whatever hours she wants, as long as she keeps up with the work. Is Marcia an employee or an independent contractor?
4. Lin uses his own desk and desk chair but uses a company-provided computer. When he was hired by a gastroen­terology practice two months ago, he filled out a W-2 form and returned it to the human resources department. He’s expected to be available to work from 8 a.m. to 4 p.m. on weekdays. He handles electronic protected health information (ePHI) and has to work from his desk to make sure that his internet connection is secure. Is Lin an employee or an independent contractor?
5. A family practice manager is hoping to hire two people to meet their large office’s billing needs. The new hires would sign a contract specifying the hourly wage and follow a particular protocol for submitting their hours; they would only receive pay for hours worked. The practice would reimburse the workers for the costs of paper, envelopes, and stamps used to send patients statements. Based on this information, should the practice manager ask the new hires to fill out a W-2 or a W-9 form?