Questions on Medical Transcription, the IRS, and Some New Terms

Is an independent medical transcriptionist a contractor or an employee? It’s an oft-repeated question in the medical transcription community, even for those who are still finishing medical transcription training. The question is important because its answer determines whether a medical transcription services organization (MTSO) pays withholding tax or not.

This question in fact was the bone of contention in a well-known legal wrangling between the IRS and an MTSO. The latter won its appeal recently, sparing it from paying the IRS $500,000+ for withholding taxes and its attorney, for his fees compensation.

The IRS defines employees who are subject to tax withholding as:

"Under common-law rules, anyone who performs services for you is your employee if you can control what will be done and how it will be done. This is so even when you give the employee freedom of action. What matters is that you have the right to control the details of how the services are performed."

On the other hand, independent contractors, are defined as:

"People such as lawyers, contractors, subcontractors and auctioneers who follow an independent trade, business, or profession in which they offer their services to the public, are generally not employees. However, whether such people are employees or independent contractors depends on the facts in each case.

The general rule is that an individual is an independent contractor if you, the person for whom the services are performed, have the right to control or direct only the result of the work and not the means and methods of accomplishing the result."  

The case was won for the MTSO by a tax lawyer who was able to present the correct documentation showing that medical transcriptionists are independent contractors.

Meanwhile, another important question was recently answered—not in the courtroom this time, but in medicaltranscription.com via the article, “What’s the Difference Between an EHR, EMR and PHR?”

The piece takes up the cudgels for medical transcriptionists and those who are still taking medical billing and coding training or medical transcription training who are a little uncertain about the exact meanings and importance of these new digital-age acronyms. The descriptions below are based on the explanations in that article.

EMRs or electronic medical records are patient records in electronic form which are made within the hospital or in the doctor’s office. They replace the paper chart system that was previously used. EMRs are used by the medical provider (the doctor or the hospital) and staff to maintain patient care.

EHRs or electronic health records are electronic medical records and then some. EHRs are designed to be shared in digital form among medical providers, say between the medical oncologist and the radiology department, and then with the surgeon. This digital information may be shared with the hospital and the patient, too.

PHR or personal health record is an electronic health record that’s owned and maintained by the patient himself, but which can be accessed by others (usually a physician) if given the authorization by the patient. It’s typically stored in a secure web portal and contains such information as lab findings, imaging reports, immunizations and other data gathered by medical providers.

Meditec.com, a top portal for billing and coding training, pharmacy technician classes, and medical transcription training, gives medical coders and medical transcriptionists professionals the training they need for a fast-digitizing medical-documentation industry.