DB gives primary care some respect. “We could solve this problem if we aligned the incentives towards primary care, rather than away from primary care. Primary care physicians are underpaid – relative to their colleagues – and have to work very hard, long hours. They get little respect within the medical community – and yet they deserve the utmost respect because (in my opinion) they truly have the most challenging profession.”

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  • Anonymous

    Serious question – how do you physicians get paid? Do you have contracts with the hospitals for a set sum that includes some overhead but not all? How do you determine what is adequate compensation? Are the contracts pretty diverse in terms of time commitment and pay schedule or are they all pretty similar?

    For those that don’t work in hospitals, do you simply sign up with a health insurer(s) and negotiate fees for certain procedures?

    CJD

  • dr john

    Kevin: The Stark Law does not get the blame it should for the creation of ER overcrowding and for the decline of primary care diagnostics.
    The Stark Law assumes that if a primary care doc owns an x-ray machine he’ll overuse it, just to rip-off the system. Stark’s arcane regulations and red-tape make owning lab and radiology equipment impractical for all but a few of us.
    Nowadays almost every diagnosis depends on some sort of lab or x-ray study. Often it takes days-to-weeks for a proper outpatient evaluation to be completed because local hospitals save the x-ray slots for themselves. Ergo, more patients go directly to the ER for their work-ups, where their x-ray studies are the hospital’s first priority.
    Question: Why can my dentist own an x-ray machine, but not me?
    (Imagine going to your dentist with a tooth-ache: he gives you a slip to go to the local hospital for dental x-rays, telling you to return for treatment in several days.)

  • Anonymous

    CJD-

    Your question does not have an easy answer. In general, for a doctor in private practice, reimbursement negotiations must be undertaken with every insurance carrier (there is nothing “simple” about signing up with them). Their reimbursement rates in general are based on the rates that are set by the Center for Medicare services. Every patient visit is billed at a certain complexity level (1-5) based on a ridiculous compendium of items including history obtained, exam done, “risk”, management, and tests obtained. Then the claim is submitted to the insurace company, and they pretty much pay what they want on the claim based on their negotiated fee for that level visit. In general, I get back about 65% of what I actually bill. This needs to cover all overhead and expenses.

    Keep in mind, many insurers do not pay for physicals (including Medicare). They don’t pay for counseling issues. For example, I can talk to someone for 30 minutes about smoking cessation, but I won’t get paid a dime for it. However, once they get COPD or lung cancer, the money rolls in! Smart system, isn’t it.

  • Anonymous

    CJD,

    I don’t think I could explain it 1,000 words or less, and that is just for me. there would be a thousand other scenarios for other doctors. In general as an ER doc the chart is “coded” to see what medical complexity and procedures were required then sent to the patient, insurance, medicaid, medicare, phantom illegal alien address, etc. There are some different arrangements with different insurers. “Downcoding” is rampant as they think you will be too busy to care which is often true. Then in the end about 36% of the dollar bill is returned

  • Anonymous

    I knew, given the nature of the forum, that answers would necessarily have to be condensed, but thanks to those of you who did answer.

    So how do we change this broken compensation system? Is it possible to take the government out of the system?

    Do you think with the corporate financial crises in part precipitated by health benefits promised in many industries that a new model will arise there which will fundamentally change things?

    CJD

  • DBR

    CJD asked: “So how do we change this broken compensation system? Is it possible to take the government out of the system?”

    Would that it were possible, but when have you EVER seen government reduce its involvement in citizens’ lives….?

    The third party payor system has destroyed health care and created an entitlement mentality about medicine. After all, since I’m not actually PAYING for anything, I can demand the best, the most and often the unnecessary. If I don’t have insurance, I can show up at am ER and I know somebody will take care of me – never mind that it costs ten times more to diagnose the common cold in an ER than in a family doctor’s office…
    Americans are under the impression that the medical profession owes them health and happiness – and expect not to pay a dime for it, generating an: “If someone else paid my grocery bills, I’d eat filet mignon every night” mentality. And, sadly, there are so many millions of dollars wasted throughout the system on things that don’t remotely resemble medicine that the ultimate providers of health care, i.e., DOCTORS, are getting an increasingly smaller share of it…

    Which, in addition to the medical liability mess, is the reason I tell both of my sons that they’ll go to medical school over Mommy’s dead body…

    DBR

  • Anonymous

    Donna, that’s a foolish thing to do, considering if you want your sons to be economically well off, physician is still the best choice by far among professions.

    But to be sure, professions are a calling as much as a business, so if they just want to make money, a business degree may be a better choice.

    CJD

  • Anonymous

    One other thing – it’s interesting that you want government out of health care because you believe it has made a mess of it, yet you want more government in the legal system. Strange.

  • Anonymous

    1% of people consume 70% of the healthcare dollar. 10% of pople consume 90% of the healthcare dollar. Around 50% of the healthcare dollar is spent on the last 6 months of a persons life. The system will collapse because of this way of societal thinking. Until we deny repeat felony drug abusers in jail dialysis because they destroyed themselves, or deny 85 year old grandma a dignified death and instead intubate her and torture her for an extra few months of life, there will not be basic helathcare available for all. Society, lawyers, and family members expect this kind of treatment. Therefore I must continue to practice futile medicine.

  • dr john

    CJD is incorrect about medicine being lucrative, especially for primary care doctors.
    It is incorrect to compare the wages of doctors to ditch-diggers, for example, because (most)doctors would not have otherwise dug ditches for a living. No; they likely would be in the management of businesses, partners in law firms, etc. In terms of dollars-per-hour, they would have done better in lots of other fields.
    Examples abound. A buddy of mine is a high school principal who will likely retire soon, before age sixty. He had more money in his pocket than I until we were both about 40. He had summers at he beach. Full benefits. Based on his salary, his kids received generous financial aid in college.
    In contrast, I, in private practice, seldom take a day off, don’t expect to be able to retire until I’m about 70, and I paid through the nose for my kids’ tuition.
    Like the writer earlier, I discouraged my kids from medicine because of the low pay, the lessening autonomy, and the predatory loyas.
    I suggested Orthodontia; now that’s a good job!

  • drdarcy

    Hi CJD,
    You’ve mentioned that you think physicians are the “highest paid profession” a few times … why do you think that?

    I have a lot of anecdotal data like DrJohn’s … it seems like my friends (late 30′s early 40′s) who did business school or law school have done “better” than I, … comparing the time/money investment in “launching” one’s career, amount saved for retirement, etc. Some of this may be due to the dot com boom … I have a number of friends who did quite (okay, obscenely) well in tech, some of whom didn’t even pursue grad school, giving them a head start … but even just compared to the lawyers … I make more than the public defender, but less than anyone else. We all work about the same (ridiculous) hours. I don’t expect that I’m going to “catch up” later in my career … I think they’ll always have more money than I will, and be able to retire earlier, with more.

    I don’t know how private practitioners negotiate contracts with insurers, but I do know that my university hospital has negotiated the HMO contracts at reimbursement rates LOWER than those found in the community … despite the fact that we see the bulk of their patients. And, that our billing department doesn’t collect on an awful lot of charges … sometimes because the patient doesn’t pay their part, but more often because there’s a billing screw-up and no system in place to catch the mistakes … so they just don’t get re-billed after the insurer denies the first time.

    My clinic has never been in the black for the 8 years I’ve been here … research dollars support clinical services.

  • Anonymous

    Dentists do better than physicians, on average. They also depend less on reimbursement from insurance companies for their practice income.

    I agree with the posters above. Compared to other professions, medicine isn’t that advantageous. The long training, the expense of education and the delay to earning an above-minimal salary is the reason. Most doctors get a very late start at retirement savings (and less time for their investments to grow), buying a home and starting a family (with the educational expenses of their children to save for) and frequently have to do all of these in a much more compressed time frame than is typically necessary in other careers.

    In addition to that, there aren’t many hidden perks in the medical business: no contribution to retirement by employers, no employer-paid FICA share, no “paid” vacation, no employer-paid disability/life insurance, no club memberships, no company cars or other work-linked material benefits. You can go to a conference in a nice city, but your practice earns no money in your absence (even a McDonalds franchisee makes money when away) and you have to pay all your expenses. It is a self-employed occupation, in nearly the purest sense.

    Lots of these comparisons between incomes of different occupations fail to consider that.

  • Anonymous

    “You’ve mentioned that you think physicians are the “highest paid profession” a few times … why do you think that?”

    US Dept. of Labor statistics. Physicians are the highest paid profession by far on average.

    And all of the perks you say physicians don’t have, no other self employed professional does either.

    CJD

  • Anonymous

    Not quite true CJD.

    A lawyer can order in lunch, work at his desk or even have an informal meeting with other lawyers on a client-related matter, bill the time and the food to the client. And don’t tell me it doesn’t happen. I worked in a white-shoe office and saw it myself.

    A doctor can’t do that. I do business over my lunch hour–when it actually is an hour–all the time. Nobody pays for that.

    Lawyers can do business from the road, even when they are travelling on non-business or other client business. Do you think that doesn’t get billed?

    Surely you’ve heard the jokes about lawyers in hell and billing sheets?

    I would say medicine is like other clinical professional occupations, except it seems to be ruled more by third-party reimbursement than others, and it takes much longer to complete training (twice as long as a J.D. plus a LL.M. in Taxation, if you want a comparison, or at least four times longer than a typical MBA)) Dentistry doesn’t worry about Medicare.

  • Anonymous

    “A lawyer can order in lunch, work at his desk or even have an informal meeting with other lawyers on a client-related matter, bill the time and the food to the client. And don’t tell me it doesn’t happen. I worked in a white-shoe office and saw it myself.”

    Sure, in a white shoe office to (some) corporate clients, undoubtedly. But how many lawyers are there doing that? If, like the vast majority of lawyers, you’re in a small firm with small businesses for clients, try sending that bill out and see what kind of response you get.

    Your real beef is with how you’re paid. And if you guys put half the effort and money into reforming that as you do tort reform, you’d probably be much, much better off.

    CJD

  • Anonymous

    CJD: Tell me how much time to you bill a week for your phone calls? I am on the phone multiple hours per week and you know how much I can bill for it….$0. Your lack of knowledge of the business of medicine is appalling. How about you become educated on the subject before opening your trap…. otherwise you just look like an idiot.

  • Anonymous

    My practice is only 30% billable hour, so the number would be meaningless. You seem to have this belief that every lawyer in the country works for a massive firm billing out at $250/hour to Fortune 500 companies. That’s simply not the case.

    I don’t pretend to know much about the business of medicine beyond the basics; very few Americans do. That’s why I asked about it. Why that is appalling to you I don’t know. It should make you wonder why your lobbying organizations aren’t doing a better job of explaining it to the public when the way you are paid appears to be one of the chief complaints of physicians.

    What’s more, there is nothing that prevents you from going to an hourly model, or any other model that doesn’t involve third party payors, other than you aren’t willing to take the risk. Since you’re not, you should sack up and quit whining.

    CJD

  • dr john

    Thanks for the advice, C, J.D.
    Have a nice day off tomorrow, Martin Luther King Day.

  • Anonymous

    I’m not a federal or state employee, John. I’ll be at work – in fact I’ll be in an arbitration. I do take vacations now and again though, I will admit. I’m sure you’ve never done that.

    But you have a good MLK day as well.

    CJD

  • Anonymous

    Yes or no answer bottom feeder, have you ever billed a client for the time you have been on the phone. Please leave out the explanation, just answer the question.

  • Anonymous

    “and it takes much longer to complete training (twice as long as a J.D. plus a LL.M. in Taxation, if you want a comparison, or at least four times longer than a typical MBA”

    Isn’t some of a physicians’ training paid training?

  • Anonymous

    “Yes or no answer bottom feeder, have you ever billed a client for the time you have been on the phone.”

    Charming, but I realize you’re just angry because you’re so ignorant. Since I know you could use it, I’ll educate you. If I’m talking about the case, of course. That’s in my contract with the client.

    Are you mad because you’re not smart enough to put that in your own contracts for reimbursement?

    CJD

  • Anonymous

    “Isn’t some of a physicians’ training paid training?”

    Yes.Residents are usually paid a stipend. Work hours are officially limited in most states to 80 hours/week, with varying compliance. Salary is low, typically less than what a junior teacher with a bachelor’s degree would be paid, and there are few benefits (one-year contracts), no retirement benefits whatsoever, usually a limited medical plan, parking, (if you are in a kind program), and a small meals allowance for nights on call. No vehicle reimbursements, even for call duty, no travel expenses, and usually a small allowance for travel once a year if you are presenting a paper.
    The average hourly wage usually falls below the federal legal minimum wage in most locations.
    Most residents do not earn enough to accumulate savings in training, particularly if they are trying to pay educational loans at the same time.

    Medical school is unpaid and the tuition and expenses are often high. Some schools are budgeting nearly $60,000/ year, which is just incredible.

  • drdarcy

    CJD,

    I don’t think that it’s that we’re too stupid to “do better” with contracts … I do think there are a number of cultural factors and educational factors in medicine that make many doctors very bad business people.

    However, those individuals who start ‘health maintenance’ organizations tend to be excellent business people.

    As I’ve said, this is not something I’ve had the need to do myself, but my friends in private practice find it emotionally very difficult to say “okay fine, screw off” when an HMO or a PPO or Medicare offers a crappy contract.

    They think of the many patients they like and want to continue seeing, who cannot afford to pay out-of-pocket. They think of wanting to help people.

    From your previous comments, it sounds like a desire to help people is why you’re doing what you do, rather than making $250/hr writing contracts for big companies like many of my friends. That’s good … as a society, we want most of the doctors, and lawyers, to be “not just in it for the money.”

    RE: money during training … I don’t think student lawyers have such an awful deal … at least not if they’re going into something lucrative.

    When the contract-writing friends were in law school, they did get “summer stipends”, and perqs and booze and snackies at 5-star restaurants galore, working for the big and expensive firms. However, the public defender had to bring his own pens, and sometimes had to buy or bring clean clothes for his clients.

    While I did get paid a miminally livable wage as a resident and I had access to a lot of free pens, at no time in my training was I ever taught anything about reading an HMO contract, or even basic accounting. Nothing on negotiating with insurers, or really, negotiating with anyone. Nothing on setting up a business, managing taxes, setting up corporations, nada. I’m learning, but it’s slow.

    It is unreasonable for some of my colleagues on this list to expect you to be well-educated about medicine, and I have been embarrassed when they have berated you, often very unprofessionally, for holding views that are a perfectly understandable starting point for a non-physician.

    However, I am not sure, given the training of physicians in this country, it’s reasonable to assume docs will be terrific, or even minimally competent, at all of these contracting/negotiating issues it took my friends three years of law school to learn. And, really, do you want a bunch of doctors who are constantly and ineffectually arguing with rapidly changing insurers about whether an office visit, 30 minutes, moderate complexity, should be reimbursed at $35 or $45 or $65 dollars? What about 45 minutes? What about 15? What about maximal complexity? What if we draw labs? What if the NP sees the patient, not us? Aren’t we already providing poor enough ‘customer service’ and wasting enough patient time … as we hear so often?

    I’m not sure what the answer is, but I’m pretty sure encouraging physicians to go to business school is not it …

    Also, re: the department of labor stats … the margin of error on the physician salaries is huge … I think there is probably a bi-modal distribution there … with most physicians making “less,” but a smaller group of subspecialists making “more” and skewing the numbers upward … thanks for pointing me there.

  • Anonymous

    “Are you mad because you’re not smart enough to put that in your own contracts for reimbursement?’

    Bottom feeder:
    Since pretty much all of these contracts are some derivation of medicare rates, we can’t bill for our phone calls (there are exceptions). Of course I could just open a boutique practice, take care of the rich and charge up the wazzoo. But that is not why I became a doctor. Is that why you became a lawyer?

  • Anonymous

    “”Are you mad because you’re not smart enough to put that in your own contracts for reimbursement?”

    I don’t think it is that we aren’t smart enough, as much as not flexible enough and perhaps tough enough.

    Some doctors fear that if they don’t accept even disadvantageous contracts that their patients will take their business elsewhere rather than pay out of plan fees or change insurance carriers. And there is probably some truth to that.

    Others just know that their patients don’t have either the money to pay extra fees or the freedom to choose better coverage and they like them enough to suffer the losses, up to a point.

    Some doctors have complicated professional relationships with referring doctors. Specialists who want to get referrals from other doctors sometimes have to eat the bad in order to keep getting the good. Availability to one’s referring doctors matters
    as a means of retaining goodwill. Still, there are limits to this, too.

  • Anonymous

    “I don’t think that it’s that we’re too stupid to “do better” with contracts”

    Do not take my comments toward that particular anonymouse as directed toward the profession as a whole.

    ” at no time in my training was I ever taught anything about reading an HMO contract, or even basic accounting. Nothing on negotiating with insurers, or really, negotiating with anyone. Nothing on setting up a business, managing taxes, setting up corporations, nada. I’m learning, but it’s slow.”

    I think that’s a real failure of professional schools, law included – to teach you about the business of the profession. That being said, I appreciate your candor.

    It also leads me to this question – what are your lobbying organizations doing for you anymore? I know they’re strong on tort reform, but what have they done to help you deal with the insurers, to help you handle practice management, and other things related to practicing medicine AND making a living?

    CJD

  • drdarcy

    I think it’s complicated because there are so many players on the insurance side … even with the biggest insurers, there are 100s of local groups they contract out to … and these are always changing … and each state has slightly different insurance laws to manage. So, for example, if the AMA targeted Blue Cross/Blue Shield for some sort of focused action, they’d really be dealing with 100s of entities across the country.

    Obviously, there are some “big ideas” … national health care, etc, etc … but since physicians themselves don’t agree on what would be best, I don’t think the AMA is able to try to sell any one big idea to the rest of the country.

  • Jennifer*

    I do the billing for several doctors that work for the local hospitals part time.
    Most of my doctors are allowed to bill for their own services while making a monthly fee from the hospitals.
    I see it as a benefit as it allows the doctor to make monthly residuals while they are focusing on getting their own practice up and running.
    http://askamedicalbiller.blogspot.com/

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