Why Obamacare scares this cardiologist

I recently visited my cardiologist. It was a routine follow up after a heart attack a year ago. I enjoy our relationship. As a token of my regard, I came bearing a gift. It was a copy of my book Obama, Doctors, and Health Reform.

I knew he had qualms about Obamacare. He expressed doubts about the health reform bill’s merits. The bill will roll out over the next ten years. The big budget items covering the uninsured will start in 2014.

He did not think Obama is close enough to the doctor-patient relationship to grasp the bill’s implications. He feels the bill tampers with that relationship. It raises costs of care while discouraging bright young Americans from becoming doctors. One target of the bill, in his view, are specialists like himself. They care for sick Medicare recipients.

These patients account for a high proportion of Medicare’s costs. Some 5% of patients with chronic diseases — diabetes, heart disease, mood disorders, asthma, and hypertension- consume 50% of health spending.

In the end, to rein in costs, Congress has four basic options: ration care, slash physicians’ incomes, delay age of entry into Medicare, or means test Medicare. For political reasons, Congress is unlikely to overtly ration or to change Medicare entry or to ask those with higher incomes to pay more. That leaves the easy option — paying doctors less.

Even before Obamacare, he noted Medicare recently cut fees for heart procedures by 40%. He expected more cuts under reform. Congress uses its Medicare powers as a blunt instrument to lower physician incomes, often arbitrarily, capriciously, and unilaterally. There is nothing rational about it. Ominously, the reform bill proposes to gut $565 billion from Medicare over the next ten years.

The political jabber is that these cost cuts will come from reducing fraud and abuse, ending waste based on regional variation, and standardizing care under comparative effectiveness research, More likely, says the cardiologists, most cuts will take a bite out of doctor pay for high tech procedures, such as placing stents in heart arteries or inserting pacemakers. He says cardiologists feel this downward reimbursement trend is inevitable. Anticipating this trend may be why the number of new American-trained candidates for cardiology fellowships are in short supply, and dropping rapidly.

Other trends are going unnoticed, he observed. These include hospitals buying out cardiology groups in unprecedented numbers. Cardiologists are seeking economic security and the capital necessary to recruit new cardiologists. finance information infrastructures, and compensate for rising business expenses. Their fears and needs make them ripe for hospital plucking.

On their part, hospitals, fearful that health reform will negatively impact them, are purchasing cardiology and orthopedic practices. These practices contribute as much as 80% of hospital bottom lines. There is a drive to consolidate hospitals and specialty practices under one organizational roof. This will raise costs. Inpatient procedures tend to cost twice as much as those performed outside.

With that, I bid him farewell until next time.

Richard Reece is the author of Obama, Doctors, and Health Reform and blogs at medinnovationblog.

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  • David

    I could not agree more, that PPACA does little, if anything to reduce the health care costs. While the CBO has projected federal cost savings a decade from now, we will have to see whether their math bears fruit. In the meantime, however, some other discussion is appropriate.

    PPACA, the bill that passed this year has numerous provisions that will change the way health care is delivered in this country. Depending on your role as a patient, physician, insurer, etc. some of those reforms are good and some are not.

    Let us separate out some facts, however.

    First, the $565 billion being “cut” from Medicare is largely cutting kickbacks to insurance companies through the Medicare Advantage program. It is not directly cutting costs for benefits OR for physician reimbursement.

    Second, the cuts to physician reimbursement were completely removed from the health care bill (PPACA) due to the high cost of replacing the SGR ($250 billion). The Obama administration, however, tried numerous times to pass “the doc fix”, both as a provision of PPACA, and as a separate bill. Both of these efforts were blocked by… the Republican party (and some blue dog Democrats).

    Third, the “40%” cut for Cardiologists one of two things, and I am not sure what you are referencing. Either it is a cut in reimbursement for nuclear stress tests or a compound cut involving the 21% cut from the SGR and a second 20% cut that CMS has proposed based on flawed practice cost survey data. Neither of these were proposed or carried out by the Obama administration, they are CMS initiatives. Now, admittedly, Obama could potentially pressure CMS into changing their tune, but I doubt he has the desire or fortitude to insert himself into disagreements between physician specialties.

    Health care reform should not be a partisan issue, but the same assertion could be made for numerous topics that Washington chooses to opine on. Unless physicians are engaged in the process, however, Washington will legislate and regulate as they see fit and they will do so in response to the other players in health care that do choose to engage.

    • Marc Gorayeb, MD

      “Kickbacks” to insurance companies. Interesting “fact.”
      Republicans are terrible obstructionists. Another interesting “fact.”
      Obama has nothing do to with CMS initiatives. Thank you for a third truly fascinating “fact.”
      That last paragraph makes me feel uneasy. What does being “engaged” mean? I guess we better go along with Obamacare to get along; or else if we don’t get along, well, then others will just have to make us go along.
      Who needs Tony Soprano?

      • http://fcgadgets.appspot.com/ Jay

        If you are not engaged, if no one is protecting your interests in DC (the AMA does NOT represent the majority of physicians’ interests), who *will* protect your interests?

        Given the hours that most competent specialists choose to work, and the difficulty of practicing medicine while canvassing K Street, it is more or less incumbent for politically vulnerable groups to retain decent lobbying status in DC. Insurance companies and device manufacturers have the luxury of hiring full-time lobbyists to do nothing but protect their interests. If you are not engaged, what exactly do you think will happen?

        Decisions are made not by the best and the brightest, but by those that show up. If physicians can’t fix the AMA, or find a replacement to “engage” legislators in their best interests, the easy political targets (“rich doctors”) will continue to get the short end of the stick, while obscenely profitable groups who *are* engaged will suffer very little.

        Democracy is two wolves and a sheep deciding what to eat for dinner.

  • rezmed09

    These conversations about cuts and buyouts are really incomplete without the “bottom line”. Frankly, the cardiologists around me are making $400 K to over a $million per year – take home. some have been doing massive overtesting – not following the ACC guidelines and profiting immensely. And they are not all working long hours. Yes specialists deserve more pay , but how much more? 2-3 or even 5 times more?

    So they are finally going to make less – like primary care has, and maybe they will find out that the cost of doing business is less if they become employees – like Primary Care. The squeeze has been on PCPs for the last 15 years and they are leaving practice early. This is probably happening to cardiologists but not in my experience.

    The bottom line is that we need payment reform. This system is so complicated that our fights have been over amounts and with each other. In our zeal to maintain payments and income we refuse to accept the simple solutions offered by reformed health care systems from Canada to Switzerland. In the end we will not be government employees but rather corporate employees. Is that really any better?

  • David

    The Medicare cuts come from the Medicare Advantage plans where insurance companies take a premium from the federal government to provide essentially the same services that the government provides directly, only it costs more when the insurance companies provide the services. Perhaps my wording was unfair, but some people would call that a kickback.

    In the most recent attempt to reform the SGR, which was voted on in November of 2009, the Republican party voted in <a href="http://www.kaiserhealthnews.org/Daily-Reports/2009/November/20/medicare-Doc-fix-vote.aspx&quot; nearly unanimous voice against the fix in the house, and then did so again to block the measure in the Senate. Is that obstructionist? You decide. Of course, Democrats are equally guilty of obstructing federal tort reform 7-10 years ago. I seem to recall that the Republicans were very interested in fixing the SGR back when they were in power, but now that someone else is, they have decided to take the other side of the issue.

    Could Obama step in an force CMS to change policy, sure, he’s the President. Should he? Gee, even we doctors can’t get along enough to advocate together without ripping each others throats out, why would you expect him to intercede?

    What does engaged mean? Doing something about it other than watching cable news and complaining. There’s many element of health care reform I disagree with and oppose, but there’s a lot in there that is good as well.

    Tony Soprano? Really? Are you suggesting that only the Democrats use their majority to pass legislation over the objections of others? Budget reconciliation has been used numerous times over the past twenty years. It’s nothing new.

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