How Medicare undermines primary care

When I was a family medicine intern, I met a diabetic patient in the hospital who had stopped seeing his regular doctor after he lost his job and his health insurance.  His untreated diabetes made his feet go numb.  He stepped on a nail and didn’t realize it until he noticed a smell that cost him his foot.

He spent thousands of dollars on the surgery and subsequent hospital stay—far more than it would have cost him to visit his primary care doctor and get the medications he needed to stay well.

Not all medical care is created equal. Keeping patients healthy by preventing disease (the definition of primary prevention) or catching disease early to prevent complications (the definition of secondary prevention) saves the crippling costs of the tertiary care that America excels at, which we reward preferentially with our current reimbursement schemes, and which is breaking our economy.

In the 2004 Health Affairs article “Medicare Spending, the physician workforce, and beneficiaries’ quality of care,” Katherine Baicker and Amitabh Chandra show that the states that have the most primary care doctors in relation to other specialties usually have better quality care–with lower costs.  As long as all patients can get the right care at the right time at the right place, including access to specialist care and the procedures they need when they need them, emphasizing primary care prevention and wellness creates a healthier population for less money.

Part of health care reform will be paying more for the primary care that keeps patients well.

Unfortunately, the current method by which Medicare reimbursements are decided undermines primary care.  (As the largest insurance program in the nation, it drives the payments of private insurance too).

Since 1992, payments have been decided by assigning a relative value to the work that a physician does—based on physician effort, years of training required, and cost of equipment—then multiplying this by a set amount based on geography to determine how much physicians will be paid.

The “resource based relative value units” are determined by a committee sponsored by the American Medical Association, the Relative Value Scale Update Committee, or RUC.  This committee decides the relative value of different types of medical services. The RUC is comprised of a representative from each of 23 specialty societies, along with six other representatives.  The primary care specialists who comprise more than fifty percent of health care providers–family physicians, pediatricians, general internists –get only three votes out of twenty nine in deciding “resource based relative value units.” The American Medical Association has two representatives, including the Chair of the closed-door discussions.  (The AMA makes $70 million each year from licensing the fee schedules, and is the fourth single largest Congressional campaign donor.)  Not surprisingly, Medicare payments, decided primarily by specialists, favor increased reimbursements for procedures and increased use of new technologies.

Let’s compare.  What is the relative value of stenting a heart? (24) Of taking an hour to conduct a complicated discussion on end-of-life decisions?  (2.5)

Incentives drive care, which drives results.  Right now, reimbursement schemes pay specialists a lot to do procedures in a fee-for-service basis, and literally don’t pay primary care doctors to take the time to talk to patients to make sure they’re receiving the best care possible that they need. Disease prevention, screening, treatment, management and care coordination have gotten short shrift.  I get paid more for a two-minute wart removal than for the complex coordination of the care of elderly patients as they leave the hospital with multiple medical problems.

If an Independent Payment Advisory Board has the power to determine reimbursements for Medicare–which covers a quarter of insured patients, and would drive reimbursements for all insurance companies–and if the Independent Payment Advisory Board uses that power to pay primary care physicians more for the work we do counseling, coordinating care and otherwise keeping patients healthy—then without costing more money, our health care system would create a healthier America.

Kohar Jones is a family physician who blogs at Progress Notes.

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  • Henry Ehrlich

    I had to shepherd my parents through years of decline.  Even with MD friends and relatives to advise (and with an earnest and otherwise competent internist, along with AARP supplemental insurance) the process was incoherent and frequently seemingly counterproductive.  In a physician-rich region, finding a geriatrician who wasn’t running a rehab/nursing facility and therefore out of touch, was impossible.  There was no intermediate step between riding out an event in ignorance and calling an ambulance.  A surgeon disregarded our wishes and performed the wrong procedure on my mother.  A cardiologist on call tried to send my father for an MRI that would have told precisely nothing, and then claimed an inability to give a hospice diagnosis, while the next day a doctor from her practice said he would happily give one and if my Dad lived six months he would give another.  I am all for Death Panels, and I know my children, who were very supportive throughout this ordeal, know that.

    • Anonymous

      That sounds very difficult, Henry.  I wish our health system’s approach to end-of-life care was more coherent, so patients wouldn’t have to deal with counterproductive, hands off care, as your family suffered through.  It sounds like your father and your family would have benefited from getting connected to hospice sooner. Hospice does not equal death panels–it equals supported care at the end of life. I wish physicians were paid to guide patients through these difficult choices.

  • Anonymous

    It seems that your example shows that employer based healthcare undermines primary care.

    I have presented several health problems to primary care and have found the diagnosis was wrong or that the doctor didn’t have the time or expertise to give me any meaningful advice.

    Every time there is an example about how important primary care is, the patient is diabetic.

    • Steven Reznick

      It is a shame that your experience with primary care providers was not beneficial to you. The author is trying to point out that the high volume conveyor belt style of primary care medicine that has evolved so that the practices can meet all the regulatory and insurance based rules increasing their costs and resulting in shorter less personal attention is the real cause of dissatisfaction by patients and physicians alike. It is a combination of poor reimbursement for cognitive services and coordination by Medicare based on the biased RUC and insurer and employer driven initiatives which have not worked. I bet you changed primary care docs several times in the last few years based on what health plan was offered at work and who was now on that panel?  I bet at your initial office visit your complete health and personal history was obtained by you filling out a piece of paper rather than the physician taking a history verbally in the room with you?  Did you see the doctor or the nurse practitioner or PA?  Did you spend more time in the waiting room than in front of the doctor? These type of issues drive the patient and physician crazy.  All that is known is that where patients have access to primary care doctors the quality of care and patient satisfaction appears to be better.If you choose to look at your own personal experience rather than the big picture it is likely that you will never develop a long term relationship with a doctor who will be your advocate in the dysfunctional health care system. Your care will remain episodic and crisis oriented. If that is the case I feel sorry for you

  • Anonymous


  • Anonymous

    I agree, but I feel that there should not be a shift of money from specialists to primary care doctors.  Reimbursements should go up for PCP and stay the same or higher for specialists.

  • Violetta V

    Keeping patients healthy by preventing disease (the definition of primary prevention) or catching disease early to prevent complications (the definition of secondary prevention) saves the crippling costs of the tertiary care that America excels at, which we reward preferentially with our current reimbursement schemes, and which is breaking our economy.

    How exactly did you go from a concrete case of a patient with a disease, diabetes, to this sweeping conclusion is beyond me. You are talking about prevention of complications in someone who is already sick and is at very high risk of such complications, but then you use it to draw a conclusion about primary prevention.

    But your generic conclusion talks about primary prevention which often involves people whose risk of the conditions you may be trying to prevent is considerably lower, in some cases – quite low. In terms of primary prevention e.g. statins to prevent first heart attack or biophosphates in people with osteopenia, the number of people you need to treat to prevent one case of heart attack or one fracture is quite large. With the guidelines that get stricter and stricter, you end up including people with fairly low risk. In this case, your cost-saving argument is completely invalid. Ditto about catching the disease early – screening thousands of people for years, evaluating false positives and then paying for overtreatment that results from overdiagnosis is considerably higher than the cases where the earlier treatments make a difference. In fact, there are studies that show that contrary to what some people claim prevention while is a good thing – we all want to live long and stay healthy (although I doubt that I’d want to take a drug for years if the probability of my benefit from it is 1% – it all depends on risk/benefit ratio).

    Now, it may well be possible that the rest of your arguments have merit. However, you hurt your own case when you make these leaps of logic and make unsubstantiated statements like the one above. There were studies that actually showed that prevention while being a good thing doesn’t save money.

  • pmfischer

    Many specialists are overpaid for repetitive procedures that require little thought and no stress – think cataract surgery, stent placement, back injection, xray reading.  We need to reduce payment for these procedures more than anything else. In my community, the perfect morning for a cardiologist is not to fine tune someone with heart failure, but to place 8 stents, and if they are all in the same patient you save the time of having to scrub in more than onece!!  Go to our site and contribute to our legal effort to sue Medicare for trying to demolish primary care through their payment decisions.  paul fischer md

  • Anonymous

    So basically, replace one board with another and hope they do it right.

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