Dropping out of Medicare will break my heart

I met with my staff yesterday to discuss the effect of a 27% cut in Medicare reimbursement on our patients and our office.  I had a really lousy day, explaining to my elders what would happen if Congress fails to act.  One of my patients aptly pointed out that Congress has not acted responsibly in the last 20 years and that it would take a miracle for them to get their act together in time to avert Doomsday.

I’m not sleeping well these days.  While talking to my staff, I realized that my heart is breaking.  The practice of medicine is my second love.  My family is my first.  My choices are untenable.

If I drop out of Medicare, I hurt my elders.  The elders in my community worked hard to build this country, putting money into Social Security and Medicare while saving for their futures.  They deserve more than Social Insecurity and the downgrading of Medicare into Medicaid.  Having to pay cash for medical care will drain their funds and spirits.

If I stay in Medicare, I will have to find a way to reduce my overhead by 27% or reduce the level of care that my patients receive by 27%.  How in the world do you reduce overhead?

“Hello, ComEd, I can no longer afford to pay my electric bill.  Congress says I can exist on 27% less.  Can you brown-out my lights or turn them off on weekends and holidays?”

“Hello, Mr. Landlord.  By Congressional order, I am sending you 27% less rent this year.”

“No, Mrs. Bashful, we no longer have patient gowns.  I’ll step out so you can take off your clothes.  Please just drape them over your torso.  What?  Yes, it is cold in here.  The gas company would not take 27% less so they turned off our heat.  I’m sorry; we had to let the nurses go.  If you are uncomfortable being alone in the exam room, we can reschedule your exam on a day when your husband can take off work and be here.”

Cutting overhead won’t work.  So, how do you give 27% less care?  You don’t.  You either give 100% care or no care at all.  You can’t rush elderly patients in and out of your office and still care for them.  You can’t limit yourself to a “one problem per visit” type practice.  Caring for the elderly is not a business.

The older a person gets the more complex his care becomes.  The older a person gets, the harder it is for him to get to the office in the first place.  I can’t imagine telling Mr. Elderly that I can only take care of his sore throat today and that he’ll have to come back in the morning to address his sore hip.  And, by the way, he should make an appointment next week for his blood pressure:  and, while he’s at it, he might as well make another appointment for his diabetes.  Yes, I know it’s winter and there is ice on the sidewalks.  “Mr. Elderly, you have enough problems, please don’t fall and break yourself.”

“I’m sorry, Mr. Elderly.  I know you have been here 15 times this month.  The country is now on the “Great Austerity Program of 2012” and we won’t be able to get to your erectile problem until we resolve your hemorrhoids, depression, ulcers, skin rash, and sleep disorder.  Those problems should only take another month or two.  Please be patient!”

Yes, my heart is breaking.  I’m watching my second love die of Congressional neglect and mismanagement and there is nothing I can do.

Stewart Segal is a family physician who blogs at Livewellthy.org.

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  • http://twitter.com/Hootsbudy John Ballard

    Bring me a tissue, please….

    Dr. Segal, how are all those practices who have already dropped Medicare doing so? My wife got dropped after twenty years by the doctor who knew her medical history better than anyone else in or out of medicine. So we had to find a doctor who accepts Medicare. Concierge practices are the wave of the future, I hear. 

    As for spending down to Medicaid, unless and until something is done to address the costs of long-term care that will be the future for a growing number of families. Our national collective wealth as measured in individual net worth is rather quickly concentrating at the top of the economic scale. (Compare “average” wealth with “median” wealth and find that we are way poorer than Japan or England.) Unless something changes, our grandchildren will look forward to Medicaid in the same way that our generation anticipated Medicare. 

    That begs the question, of course, how many more will follow suit if the “doc fix” is not passed (which no one believes will come to pass, especially after today’s disciplinary lesson for the Tea Party members of the House). Does that mean that HMOs and places like Mayo and Kaiser will be asking patients to bring their own gowns? I think not. 

    You might check out that Direct Primary Care (DPC) model described in an earlier post here.

  • http://makethislookawesome.blogspot.com/ PamC

    This isn’t just the elderly. This is everyone disabled with a chronic illness, too. That includes 20-year-olds.  Medicare: now accepted nowhere! 

    • Anonymous

      The disabled are covered by Medicaid, not Medicare — what he was concerned Medicare would be downgraded to. That line kind of unnerved me. Why shouldn’t we be protecting the poor and disabled as much as the elderly; why does it not break physicians’ hearts to have to drop those patients? They deserve care and it is often just as complex.

  • Dedangelo

    And what is your yearly salary, doc?

    • Anonymous

      Less than what he deserves considering his job involves the responsibility of caring for peoples’ health and took at least 11 years of rigorous, post-high school education and training.

      • Dedangelo

        Disagree. The entitlement mentality among certain members of the profession needs a good hard slap in the face. Our standard of living is decreasing.

        • Anonymous

          “Standard of Living”: Whose standard of living? Non-physicians? Why should their salary decrease as a result of that? They are not causing our standard of living to decrease. Any perceived decline in the quality of medical care (shorter appointments, etc) is more to do with pressure from insurance companies than anything else.

          Entitlement: Are you kidding me? The entitlement in the general population needs a good slap in the face. Just because you are struggling — heck, we all are (I’m on Medicaid, for Christ’s sake) — does not inherently mean you deserve to be making a significant amount or that they deserve less. Physicians are not slaves to society. They are working professions who are providing a service that most of value (if you doubt it, how would you feel if physicians went on strike?) and they dedicated years of their life to provide. They deserve to be fairly compensated and the idea of physicians making less than 100k seems awfully unfair when you take all that into account.

          On the reverse side, you have people who believe they are entitled to hours of a physicians’ time without paying anything, that physicians who bend to their every well and, God forbid life happens and something not to be perfect, that they can just sue them and all will be well. THAT is entitlement.

          • Anonymous

            Note: I said I was on Medicaid. No, I do not pay anything; however, I am incredibly grateful for what they provide and, if I could, would pay them more than Medicaid agree to.

          • Dedangelo

            Still disagree. For the record, I was a healthcare provider for 19 years. Frankly, I would love to see some strikes in this country. The 1% is killing us all. At present, we are all slaves to them. In addition, there are plenty of physicians who don’t make six figures who also don’t whine about their profit margin decreasing or threaten to lay off staff.  Conversely, there are physicians who sold their souls to managed care compainies and big pharma. Our society would do well to take physicians off their pedastal, and physicians would benefit from it as well. They could be seen as human rather than God.

          • Terry M

            What kind of healthcare provider were you, Dedangelo?  (I’m not saying I necessarily agree or disagree with you, but I’d like to be able to put some of your statements into context.)

          • Dedangelo

            I was a hospital and community mental health psychotherapist. Sat on utilization review panels (the real “death panels” ) and did case management. Provided clinical supervision and professional education.

          • Anonymous

            First off, your primary care is not in the 1%. Depending on his specific salary, he can be anywhere from 250k to 200k too low. The same goes for many, many specialists (most likely, even most). How can you argue for your opinion if you do not even seem to know this?

            Second off, this black and white view of the 99% vs the 1% is absurd. This idea that all of the 99% are slaves or victims (if so, so is this physician!) to the 1% and that the 1% is out to make our lives difficult. While there are some awful, awful 1%ers (who are usually more a part of the %.01), the vast majority are not. The vast majority, through some combination of hard work and (in corporate) a creative mind, earned their keep.

            Physicians fall under this group (well, they would, if the majority were actually 1%ers…). That and the fact that they are dealt quite a bit of responsibility.

            (I believe a major contributor to this myth about the 1% were the few 1%ers in the banks who crashed everything. Factually, per bank, 2 – 5 people TOTAL [out of thousands of people] knew about it. There was no mass conspiracy with most of Wall Street).

            (One more thing — many people work hard. Compensation wise, skilled labor should > unskilled labor. Anybody can do unskilled labor so, while it is important, the compensation will be less. Especially if that skilled labor is in high demand vs the supply).

            Furthermore, “members of the one percent volunteer much more of their time,
            effort and money to charitable causes than do members of the general
            public” and a “typical (median) member of the one percent donates about four percent of his or her income to charitable causes.” (December 5, 2011 | Research; A Rare Survey of the One Percent, Northwestern). 

            Most physicians are not seen as God and most physicians don’t see themselves as god. The majority are looked at the way that you look at them and the majority feel the same as the original author of this piece. 

            And it doesn’t matter if you think it would be best to “take them off their pedestal”. It’s about fair compensation. Get off your own pedestal! It would do everyone good to stop thinking they are entitled to more. If you want more, there are numerous paths to take to achieve this.

            Very few physicians, furthermore, make <less figures. Of the ones that do, the majority are part time. So, no they are not complaining. That is still irrelevant. If one complains about something has no bearing on if it should happen.

            Also, what are your qualifications? "Psychotherapist" is a broad term. Are you an MA, MFT, MSW, PhD/PsyD, etc?

          • Dedangelo

            Glad I touched a nerve. It obviously needed to be touched. It speaks to the insanity of the silos we are in as does your defensiveness.
            The point is (again) that our Standard of living except for the 1% is falling, and physicians are in no way entitled to be an exception to this phenomenon. Is it hard? You bet. Get used to it. The choice is yours — are you willing to lower your standard of living to keep your office staff employed and provide healthcare to your Medicaid patients? Or will you be petulant because the American Dream died for you too?

          • https://me.yahoo.com/a/8lPLyDsl3uS.LfDfaSVX3iw8FEhj7vq1#44b0c joe

            I disagree with you. The “1%” salaries are anywhere from 340K-500K depending on the source.  The fact is the vast majority of docs (especially in primary care) don’t fall into that category.  Do neurosurgeon’s fall into that group? Likely, but I am not going to fault someone who spent 15 years of education after HS and operates on a brain for that salary. As alluded to above the 27% cut (though kicked doen the road two months) is much more than 27% when overhead is taken into account. Medicare has gone up around 1-2 % in the last decade total (look it up). How much has your expenses gone up in that timeframe Dedeangelo? Speaking of salaries, how much has YOUR salary gone up in the last decade? Let’s touch another though unrelated “nerve” Dedangelo, you state you were a mental health “provider” and then left. The simple fact is as a medical doc I have found the LEAST responsive providers happen to be in your “former” specialty. Indeed, I am essentially the psych doc for most of my patients. When I page a “mental health” provider I would say less then actually 1 in 5 pages is returned. Unacceptable for a surgeon or a medical doc. It is truly sad as a “middle age” italian chick you left a field in such dire need of “providers”.  Look in the mirror before making grand pronouncements on the rest of who are still in the trenches.

          • http://twitter.com/Hootsbudy John Ballard

            I want to interject a couple of points here. One has to do with the difference between professional compensation (also mentioned above) and the other regards the difference between income and wealth. 
            ~~~~~~~~~~~~~~~~~~~~~I’m being redundant here, but it’s worth repeating that compensation and profit are not the same. In fact, anyone who knows how to read a P&L (also called a balance sheet) knows that compensation takes away from profit. That’s why when a company has a massive layoff the stock often goes UP, not down, because it has shed one of its biggest expense — human labor and whatever benefits and insurance premiums it takes to retain it. I really wish doctors would stop rattling about how much they “make” or “earn.” It is more accurate to state how much they were able to be paid separately from how much corporate profit their corporate entity was able to report as taxable profit. Those two numbers are not the same. Regarding income and wealth, these are two entirely different realities. ►WEALTH is another word meaning “net worth,” total assets less liabilities. ►INCOME is a revenue stream, typically expressed in 12 month increments, which affects wealth (net worth) but that effect is by no means the same in all cases. (Income may increase wealth or it may also decrease debt, also called negative net worth.)For those with small or in many cases negative net worth, income is an addition to net worth. In many cases this means reducing negative net worth or adding modestly to a small nest egg. This is what is carelessly called the “middle class.”There is a small number of individuals (arbitrarily referred to as the 1%) with such a large net worth that it will furnish a handsome living not only for themselves and their families, but their heirs for generations yet unborn. For that select group the previous 12 months’ income is mostly ADDITIONAL wealth, added to an already large net worth. I’m not arguing about who should or should not get anything. I’m simply trying to bring clarity to a very muddy discussion. 

      • http://www.facebook.com/people/Dr-Giorgio-Patino-Md/100001263297391 Dr. Giorgio Patino Md.

        How less?  I can’t sympathize with physicians that want to drop Medicare patients, I don’t understand the reasoning… We entered into this field to “do no further harm” and assist where we could; not for the money.
        Thus as a western educated physician now practicing medicine in Mexico; I take patients all the time that can’t fit into the national health system, for lack of a job, lack of responsible government entities or other. Thus I have a few good paying clients and 85% low or non-paying patients that I would never, ever drop; regardless if the national health care system paid me or not. 
        To me that effort and lack of effort has led me to believe that the American Way in which I grew up with is dying….

        Dr. G. Patino MD.,
        Puerto Vallarta, Mx.

    • Anonymous

      In order to become a doctor you must spend 4 years in college (and pay the required tuition; scholarships are harder to come by these days), then spend 4 years in medical school (and continue to accumulate huge debt, most often well into the 6 figure range), then spend no less than than three years in residency (making in the $40K range, which is barely enough to pay back their student loans during this time). On top of the financial cost, the amount of time spent studying and working is astounding (they had to limit residents to 80 hours per week, which means that they could be working longer if it wasn’t mandated they can’t). All this is time spent away from their families and friends, just so doctors can earn the right to serve patients. Doctors delay having families, skip holidays with family, and spend countless sleepless nights just to serve patients. We do this because we care; money isn’t a big enough motivation to keep us going through this. Doctors are intelligent people, we could earn very good livings in easier professions. When I hear people like you demean doctors for earning a good living, I wonder if the next generation will be willing to put themselves through the hell that is medical education if they’re not going to be well compensated for it. How will you like it when all the “A” students are becoming lawyers (only 3 years after college and much better hours) and you’re left with the “C” students are doctors who neglected to study about your particular disease before you see him.

  • http://pulse.yahoo.com/_XVD6GI7PQMMR5KUA7GSFHKZC5I LisaR

    Anyone criticizing this doctor is out of their minds and playing for the wrong team. #1 The VAST majority of doctors do not enter the field for the money. To say or imply such reveals a shocking lack of knowledge as to the cost, both financial and personal, the dedication and the drive required to complete medical training. #2 This stupid government which is supposed to be “for the people,” is anything but and are the ones who created this flipping mess from the start. From top to bottom, from free ER care for ANY little perceived issue to the lawyers running Congress who inflated malpractice costs, you can blame your elected officials. Even this so called new Obama Plan is a joke. It is a huge kickback to the insurance companies and will place even more control over your health care treatments in the hands of cubiclites in Iowa somewhere trained to deny, deny, deny. #3, The average hourly rate for a family physician, after all of the extra time on things most patients take for granted, like return phone calls etc, is about $30 an hour. So, I don’t know what kind of doctors you people have who question how much they make cause I know whatever mine makes, it is NOT nearly enough. These are the people with the responsibility to keep you healthy. There is no price tag on that. I find the tone of this doctor’s article to be completely genuine and while I don’t know him from a hole in the wall, I think he seems to simply be trying to continue to care for his patients as best he can in a system that continues to devalue physicians. We need to get on the same page people. Side with your doctor!!  You know? The one who is trying to keep you alive and who advocates for you when the REAL profit makers want to deny you the care his experitse mandates.

  • http://www.facebook.com/profile.php?id=558041620 Vikas Desai

    I understand your pain, but you can’t really believe they aren’t going to fix it, they put a patch every year, they will do the same this time around. If you really care about the medicare patients you won’t drop them, dont’ really see how that can benefit you anyway. Unless you are completely booked for 6 mos, there is always room for more patients. to drop medicare even at a rate cut will harm your practice bottom line..

  • http://twitter.com/Hootsbudy John Ballard

    As usual no one is making any distinction between professional compensation and corporate profits. A comments thread is not a suitable forum for a lesson in Econ 101 but briefly there is a big range of corporate arrangements in medical providers from super-sized operations with employees (including, yes, physicians, surgeons and specialists) paid in accordance with market wages — all the way down to cottage industry operations with one or a handful of doctors.

    Whenever i see the word “overhead” I stop thinking medical professional and start thinking entrepreneur. Those two categories are not incompatible but they sure have very different objectives. The aim of a medical professional is to earn a good living by providing medical care. The aim of an entrepreneur is to operate a profitable business. Those two objectives are not necessarily incompatible but the smaller the operation the harder it is to turn a profit. The economy of scale is why the big fish eat the smaller ones.

    I saw an article lately reporting that more doctors are opting to work in hospitals or other very large operations rather than being independent operators. Income may be less impressive but the headaches are also fewer — more in-house resources, predictable schedules and fewer worries about liability. The pay is lower but the environmental differences and quality of life are huge.

    • Anonymous

       “The economy of scale is why the big fish eat the smaller ones.”

      Actually, there are no economies of scale in medicine. Larger practices are notoriously less efficient than smaller ones, and hospital run organizations even less so.

      What the larger organizations can do is negociate higher insurance payments (sometimes 3 or 4X what smaller groups get for the same service), and collect “facility fees” (even for an office that’s on the other side of the county from the hospital!).

      The AG of Masschusetts determined that it was the higher negociated payment schedules that were the main driver of health care inflation in her state.

      • http://pulse.yahoo.com/_2LRZNHDZS6DU45WQ567LPQ7CMI ninguem


        What southerndoc said. The MGMA’s factoid is a FP like me, needs 4.5 employees per doc. I have two. The MGMA does not gather data from the small fish practices, just the big box places.

      • http://twitter.com/Hootsbudy John Ballard

        Absolutely right. I was in the food business and I get the point immediately. Home cooking is always better than eating out and the Mom and Pop restaurant always has the edge over any national chain. (We can forget about the Greasy Spoons for the purpose of this discussion.)

        Similarly, the concierge practices will (or should) outperform the volume outfits for exactly the reasons you explain. It is easy to confuse a public policy of furnishing adequate health care to a whole population against a gold standard for the select group able to pay more. That’s why some travel arrangements are first class and other coach.  

        • http://onhealthtech.blogspot.com Margalit Gur-Arie

          John, in this case home cooking and mom and pop restaurants are not only better, but also cheaper.
          There is no need for McDonald’s in health care because the lower quality is not offset by lower prices to the consumer.

          Just wrote a whole tirade on this exact subject…

    • Dan_McCauliffe

      John you are incorrect.  Many doctors are giving up practice to earn more as employees of larger organizations.  Medicare pays these employed physicians substantially more than if they remained in private practice.  For example cardiologists get paid 45% more for certain tests as employees of a hospital and in my state physicians are giving up their private practices to work in federal clinics where they get paid about 58% more than in private practice.  For more details on these government payment policies that are destroying private practice see:  http://www.burlingtonfreepress.com/article/20111204/OPINION02/112040334/My-Turn-Doctors-leave-private-practice-should-patients-care-

  • http://www.facebook.com/shannon.kramergiorgio Shannon Giorgio Petteruti

    I have to say kudos to you Dr. Segal. My husband is a family physician with his own practice. He has chosen to stay that way to deliver the best care he can give. There is a big push right now in our state for all the family doctors to be an umbrella under one of the bigger hospitals. This would mean answering to someone else which is not an option for him. He would have to spend less time with his clients and order tests that he doesn’t feel are necessary. So we can spend more money on healthcare, but have the physicians earn less and not have a proven better outcome for our clients. Let’s do the math here. 

    As he sat at his desk yesterday reading the article that came out about the 27% decrease he said “I don’t know what we would do?” Medicare is half his practice. Do we cut a medical assistant and tell the clients to take their own blood pressure and just let us know what it is? How about an EKG? I’m sure they could figure out how to hook themselves up to that. 

    This isn’t about the money. And you know what, even if it is….these doctors have spent 7 years training, plus the cost of it. They do deserve a high salary. Whether it’s 100,000 or $500,000. He still sees his clients in the hospital which is virtually a forgotten past time now since the inception of the hospitalist. He get’s paged at 2:00am because Mr. Smith, who is 75 fell while trying to make it to the bathroom and now broke his hip. He will happily go to the hospital before his 7:00am office start time to see Mr. Smith, who he has known for 25 years. Going back to the math…if Medicare get’s cut by 27% these hospital visits won’t be able to happen anymore.  

    Running an office is a business. There is overhead. There are supplies. There is equipment that needs to be upgraded and maintained. Whether they will put a band-aid on it again this year or really cut payment by 27%, it changes the way physicians have to practice. And it is not at the benefit to the consumer. 

  • http://twitter.com/chasedave Dave Chase

    Thanks to John Ballard for linking to the “Primary Care Doc Fix is In” below. In that article, there’s a link to a house bill that would use the Direct Primary Care model in Medicare to pay for day-to-day healthcare needs  – here’s a direct link to that bill http://www.gpo.gov/fdsys/pkg/BILLS-112hr3315ih/xml/BILLS-112hr3315ih.xml. Call your congressman to support this. This is the way to lower overhead in primary care. As I have pointed out here (and Forbes, Reuters, etc.) - http://www.delicious.com/chasedave/DPCArticles – these practices are running with dramatically lower overhead (e.g., 80% less). Some have no admin overhead at all (e.g., AtlasMD, OrganicMedicineNow) or extremely low overhead (e.g., MedLion, Qliance) while providing a high level of care at a very affordable price. 

    As I point out in the DPCArticles link, we are paying at least a 40% “insurance bureaucracy tax” by doing the equivalent of pulling out our insurance card for the equivalent of a Jiffy Lube visit. We never did this in the “Marcus Welby” era. By combining the model of just a few decades ago with a bit of technology, it is being proven daily by a rapidly growing cohort of docs that it can be done. Like anti-lock brakes and airbags, retainer-based medicine started with the wealthy (concierge medicine) and has reached the masses (Direct Primary Care). There’s a whole new ecosystem of practice models, business systems, service providers and technology companies that have sprung up in response to the success of these models. I hear of a new org at least once a week stepping in to fill the void. Necessity is the mother of invention. The docs taking action say they feel no reason to be a victim when there’s a solution out there for them. They plan to start with 10-20% of their practice and gradually grow the DPC portion of their practice — a few are going cold turkey and switching wholesale. Some MDs who just finished residency are going straight into it – e.g., AtlasMD’s Josh Umbehr.

  • http://twitter.com/livewellthy Stewart Segal

    Recently, I have noted an anti-physician sentiment on the internet.  Docs are often viewed as the rich 1%, living off the sweat and toil of the masses.  It is apparent that many patients resent the income physicians receive for delivering their medical care.  My article, “Broken Heart,” was recently published on KevinMD.  One of the responders questioned my salary and suggested that I should be able to take the hit and absorb Medicare’s 27% cut.  Another reader suggested that I must be an entrepreneur because my article addressed the realities of practice overhead.
    In response to these readers, I started to do some research into the average hourly wages of workers in the US.  Now, I’m really upset!  According to the government site I found on the internet, I should be making $78.61 hourly.  I’m not!  Between the office and the hospital, I have slightly over 60 hours a week of scheduled work time.  By my calculations, I am making $59.65 hourly.  Apparently, I’m making 25 % less than my colleagues already.
    Reviewing 2010 figures for average hourly income reveals that dentists average $67.81 an hour, lawyers $54.21, pharmacists $53.64, judges $57.34 and I just paid the serviceman $100 an hour to service my mother’s lift chair.  Of course, the serviceman splits his fee with his company; but the hourly rate I paid was far in excess of my own hourly income! 
    What upsets me even more than making less than the median hourly rate for family practitioners in the US is that hourly rate figures for physicians are inherently misleading in the first place.  While my hourly rate is $59.65, that rate does not take into account the hours a week spent answering after hour phone calls or the late night trips to the hospital delivering urgent care.  It doesn’t account for being on call Christmas or New Year’s Eve, answering phone calls and talking to pharmacies often because those same patients calling had been sick for days or weeks and didn’t want to come into the office to be seen.
    For those who begrudge their physician’s income, try calling a plumber at midnight on Christmas Eve.  Even better, just call the plumber on any Saturday and ask how much he charges for a weekend emergency call.  I think it will quickly become apparent that the plumber’s fee for unplugging your clogged drain will be more than my fee for dealing with your clogged artery.
    I hope this addresses the issue of physician income for those readers who feel that physicians are fat cats, living high on the hog.  In actuality, I have no complaints.  I love what I do, holidays on call and all the rest.  I wouldn’t do anything else in the world!

  • maggiemahar

    Dr. Segal,

    Take a look at today’s newspaper and you will discovcer that, once again the SGR cut  has been deferred.
    And it will continue to be deferred, over and over again.

    There was never any change that your Medicare payments woudl be cut by 27%  I’m afraid you are the victim of conservative fear-mongers who want you to believe that Meidcare is on the verge of collapse. (Doctors fees cut by more than 25%, doctors refuse to take Meidcare patients, etc.)  Those fear-mongers are playing on your paranoia.

    The SGR formula will never be applied to doctors’ fees across the board. For years, Congress has refused to do it– and will continue to do so.’The notion of whacking all doctors’ fees by the same amount is both a crude and a stupid way of reining in health care costs. Virtually everyone in D.C. understands that.

    Why then doesn’t Congress repeal the SGR formula? Because conservatives find it such a useful club in their fear-mongering campaign.

    The media also loves the opporutnity to write these scarey stoires every few months– over and over again.
    Such headlines sell newspapers and TV advertising .


    Very few doctors can refuse to take all insurancce. Those who do serve an elite of wealthy patients.
    See this article http://www.msnbc.msn.com/id/34019606/ns/health-health_care/t/patients-face-bitter-choice-pay-or-lose-care/  which quotes patient advocates poitning out that :” The result, critics say, is a segregated system that offers extra access for extra cash, even as it escalates a looming health care crisis for everyone else” 

    See also this article on “Two-tier care . .. A Clniic with Two Doors”http://www.msnbc.msn.com/id/33863680/ns/health-health_care/t/clinic-two-doors-symbol-two-tier-care/

    Those who defend the concierge movement say they are simply giving patients a choice, the same way we all have a choice as to whether we want to buy a $5 latte or a $75,000 car. 

    But neither the latte nor the luxury care are necessitiets. Health care is a necessity., 

    This is why everyone should have equal access to the same high quality care.  The only that happens is if we all pool our money –the way we do when we contribute to Medicare through our payroll taxes.

    No one knows which of us is going to live to be 85, and enjoy Medicare benefits for 20 years. No  one knows who will die at 64.  No one knows who will suffer a serious, long-term expensive illness such as
    Alzheimers. So we pool our money, protecting each other against the unknonw.

    Docotrs who choose concierge medicine would divide us into the “haves” and the “havenots”

    Yes, many primary care docs are underpaid.  But the truth is that average (median) income for a primary
    care doctor in the U.S. is over $175,000. Half make more than that.

    This means that they earn more than roughly 97% of their fellow citizens.  I’m not saying that they shouldn’t
    earn $175,000 or $200,000 or $225,000.  But I don’t think we need to weep for them. .

    The primary care doctors who need raises are in the bottom half– especially those who treat many
    Medicaid patients and uninsured patients. (Under the reform law, those who treat Medicaid patients will, at along last, be paid as much as those who treat Medicare patients. And there will be many fewer uninsured.)

    Finally, here is what the future of medicine will look like:  More and more doctors will work, on salary
    for places like Kaiser, Mayo, or Geisinger. Many will work for hospitals (Already more than 60% are employed and work on salary). 

     When you and I go for primary care we will probably see a nurse
    practioner.  The evidnece shows that nurse practioners spend more time with patients, take more time listneing and getting a good medical history, are often better at teaching patients how to help manage their own chronic diseases. There is virtually no evidence that nurse practioners provide inferior care.

    When they are baffled by the patient’s symptoms, or when they are faced with a situtation where  they need help, the record shows that they quickly refer the patient to an .M.D.— much the way primary care docs
    refer patients to specialists.

  • caren4u

     David Himmelstein, MD and Sydney Wolfe, MD- worth watching…..  https://www.pbs.org/moyers/journal/05222009/watch2.html


  • http://twitter.com/#!/CloseCall_MD Close Call

    I like the future talk about salaried docs at Kaiser, Mayo and Geisinger.  But beware the unintended consequences.

    Kaiser had been on an NP hiring spree before they realized that they couldn’t see patients nearly as fast as FPs who had tens of thousands of more hours of clinical experience under their belt after finishing residency.  So… the pendulum has turned towards aggressively hiring FPs.  Same for the other large foundation models in our area. 

    Salaried docs… sounds like a great thing, right?  What happens when the docs start to unionize under these new employment situations?  Get used to seeing doctors strikes as much as you hear about nursing strikes.

    Another thing about these large health care institutions:  they can extract a pretty penny from insurance companies because of their market clout.  Sometimes 200% of Medicare rates, where a private solo doc can only get at or below Medicare.  This is a recipe for disaster that many people aren’t talking about and a common critique of the push for these new ACOs.  

    So let’s see…  you get go to a large impersonal health care facility with unionized MAs and other ancillary staff who can care less about being polite or knowing your name because – hey, their jobs are secure… staffed by some NPs, but a mainly unionized physician force that is charging 200% of Medicare rates to every private insurance company out there, PLUS adding on an “administrative fee” to every patient they see because, let’s face it, they’re the only game in town.  Oh yeah, and the docs are conducting a one day strike tomorrow because of a breakdown in contract negotiations.  

  • Anonymous

    Close calll–

    Do you have any evidence for what you say about Kaiser and nurse practionerss? (If you google my name, HealthBeat and nurse practioners you will find posts with many references to articles in peer-reviewed journals on NPs.Andn I haven’t read anything about Ksiser losing interet in NPs. . . . References?

    You may well be right that PCPs see more patients faster than NPs–but how is this a plus for patients, or for heatlh care reform? When doctors take more time listening to patients and  aking a medical history, this can mean that they order many fewer tests, and arrive at an accurate diagnosis in less time.


  • https://me.yahoo.com/a/8lPLyDsl3uS.LfDfaSVX3iw8FEhj7vq1#44b0c joe

    Once again Maggie you are showing your political “bias”. The lack of a fix of the SGR is hardly strictly a conservative bogeyman and does cross political lines. From ASCO in 2009:
    “What became known as the “Doc Fix,” S.B. 1776 failed to pass because the bill was not compliant with the previously passed Congressional “pay-as-you-go” provisions. Spending cuts were not included in S.B. 1776 to offset the cost of avoiding the 21.2% cuts in physician reimbursement. Unlike the party-line Senate passage of the Patient Protection and Affordable Care Act on December 24, 2009, 12 Democratic Senators voted against S.B. 1776. Apparently the old adage of “you get your votes before you count your votes” wasn’t sufficiently important in this case to ensure the bill’spassage” (note the 12 “democractic” senators vote).
    The fact is as our financial mess worsen’s and it will, look at the supercommittee that could not even agree on 1.2 trillion dollars in cuts. When it finally does come to ahead (and it will) some very, very draconian cuts will be needed to be made, who is to say the SGR will not be one of them? Don’t believe me? Ask a Greek. The only difference between the USA and Greece, Italy, or Spain is our unlimited ability to print money and time. That is until the dollar turns into an interwar Geman mark because China stops buying our treasury notes.
    As far as NP’s taking over primary care, that may come to pass. In reality much of the evidence you cite is survey form. What is not survey-based involves preventative primary care or basic illness treatment and chronic illness managment without exacerbation. I have read some of it and yes it seem equivalent for basic issues. I have NP’s in my own clinic. They are very good. They also know and use my open door policy when they have a question on a complex issue. It’s a little different with an independant NP. I will tell you in my experience (and I have seen no study to refute this yet, feel free to correct me) is that NP’s will refer to me much more quickly and much more often than a good internist or FP. I often have to take a big step back and complete the internal medicine workup before using my medical subspecialty knowledge. Do you honestly think this is cheaper? I am not knocking NP’s. I spent 7 years in training AFTER med school to obtain my knowledge base. An FP/IM spent 3-4 years in residency to obtain their knowledge base. It is the simply uninformed arrogance to think a 2-3 NP program is equal in total knowledge and experience. I firmly believe that a one year MINIMIUM internship should be required of an NP before an independant practice is considered. You see, the problem is Maggie you don’t have any clinical experience so you have no clue where I am coming from when I tell you of a young independant NP that sat on a patient with obvious lymphoma treating with multiple rounds of antibiotics before I saw that person in the ER. She thought it was an infection. She has not seen the process literally hundreds of times like I have or for that matter dozens of times like the FP’s/IM’s I work with. This job is all experience. That is the divide you and people like Ezra Klein will never get. You don’t have the clinical context to put much of your grandiose statements into. You have never been an RN or MD and spent time in the job. Lastly to put another hole in your money saving argument Close Call is completely right. The big organizations can and do require medicaid, medicare, and insurance significantly higher rates than independant practices. This saves money? The local federally subsidized clinic in town is significantly more expensive than the private clinics nearby. This saves money?

    • http://onhealthtech.blogspot.com Margalit Gur-Arie

      To your point, joe, and also to Dr. Mcauliffe’s point above, here are the numbers:

      “According to the Kaiser Family Foundation FQHCs had $39 Billion in revenues in 2010, 75% of which came from Federal and State agencies. They served almost 19.5 million patients with over 77 million encounters. Simple math yields a cost of over $500
      per encounter, with three quarters of this amount supported by tax payers.
      It would be interesting to find out how health, health care and cost of care would be affected if physicians in private practice in the same geographic areas were offered even half of these fees.” http://t.co/pzVTypLc

      I must note though, that this “separate but equal” system of clinics for the poor took off in earnest during the Bush administration (2001-2006). Not everything that ails health care is due to “ObamaCare” and what is to come.

      • http://pulse.yahoo.com/_2LRZNHDZS6DU45WQ567LPQ7CMI ninguem

        $165 a patient visit is better than the allowed rates by most private insurance plans. If they paid me that rate, PLUS all the other financial benefits of being a FQHC, tax-exemption, Federal Tort Claims protection come to mind, it would be a more attractive option than Blue Shield.

  • Close Call


    Re: Kaiser.  No references, just anecdotal – 3 Kaisers in the area, involvement in local FM residency program and casual discussions w their physician recruiters.  Maybe they’re just blowing smoke or it’s a regional thing (california).  I’d be curious to hear what other Kaisers are doing.  

    I’m certain that if there was a financial incentive for Kaiser to use NPs more than FM or IM docs, they would’ve replaced docs years ago.  Kaiser has never been one to shy away from large-scale investments to improve health (especially preventative services), while also keeping their care affordable.  If using NPs over docs is such a net benefit, they would’ve done it already.  Because they haven’t, I sense that there are subtle reasons not picked up by the numerous studies comparing PCPs and NPs.  I believe the  efficiency of seeing patients is one of them.  I believe the ordering of investigational studies is another (labs and radiology).  BMJ had a review article (done years ago) illustrating this.  http://www.bmj.com/content/324/7341/819.full. 

    But you’re right, time spent with the patient is important.  Most medical providers inherently know this, and as you know, are starting to explore inventive ways to offer extended visits (or visits augmented by phone and email contact) through alternative financing methods, i.e. direct patient practices, retainer, Qliance, MedLion, etc.  These practices offer the best chance of providing good, personal care at affordable prices.  If they’re run by NPs or physicians, I don’t think it matters too much.  Patients have the option of choosing based on the price, and other factors they deem important.

    This should really be a different thread, but salaried docs and NPs are a different beast altogether.  If we think we’re going to be saving money when we can extract a 200% of medicare rate for physician or NP office services… yikes.  And we’ll have to re-think all of those studies done comparing NPs and physicians – the moment a payment for a service changes, even just a little bit, all bets are off.  It’ll be very hard to predict what happens.

    I thought healthbeatblog was great, by the way.  Sad to see it gone.

  • Jim Jaffe

    can understand why a cut would be painful.  cannot understand why you think Congress is going to let it happen, inasmuch as it never has before, which is why the threatened cut is now so big.  but what I need here as a civilian is a lesson in medical economics.  assume the improbable, that the cut happens and you respond by dropping out of medicare.  assuming you cannot immediate replace the patients you drop, each resulting empty hour results in a revenue cut of 73% below what you were getting before.  obviously, your utility companies aren’t going to give you a break because of that.  or are you assuming that you can retain as many patients as you now have and be as busy as you now are without participating in medicare.  there is at least a logical possibility that dropping out of medicare will reduce your income more than staying in and taking the reduced rate (which ain’t gonna happen in any case).

  • Anonymous

    Will hospital based doctors have the option of opting out of medicare?  I’m asking because Medicare funds new doctor training in teaching hospitals. Isn’t there a chance that this funding might be jeopardised if seniors are denied care?

  • http://twitter.com/livewellthy Stewart Segal

    Every year, Congress seems less able to deal with the finances of our country.  Every year people seem to be more and more complacent with their ineptitude.  Sooner or later, they are going to let the ball drop and break the back of the American medical complex.  Sooner or later, patients are going to have to pay their own way.  A 27% drop will force that eventuality.  Many of my Medicare patients will stay, spending some of their hard earned retirement income on medical care.  Those that leave will find it hard to find a doc in my community who accepts the new Medicare rate.  Yes, my practice will slow initially, giving me more time with my remaining patients.  With fewer patients, I will have to downsize nursing staff.  Not billing and fighting with Medicare will allow me to downsize my billing staff.  Everyone, patients, nurses, billing staff and docs will lose!

    • http://onhealthtech.blogspot.com Margalit Gur-Arie

      If this snowball continues on its current trajectory, I agree, sooner or later the Medicare ball will drop. Maybe not a full 27%, but it will drop. Private insurers will then proceed to drop the other shoe and reduce contractuals wherever they can, i.e. private practice.
      Net result will be that a significant number of doctors will choose the cash alternative (you were right Dave Chase; I was wrong) and patients who can afford to, and want to, will go to the concierge
      practice. The market will decide how many private docs are left and how
      much they can charge.
      Medicare patients will begin using those federal clinics, which are slated for an increase in reimbursement in 2014 above the levels they already have. Private patients won’t be far behind. If Medicare gets voucherized, the trend will accelerate, since you will see a rise in dual eligibility as seniors get pauperized by medical bills.
      The federal clinics will grow, expand and employ those shutting down their bankrupt private practices.
      Hospital outpatient clinics should be OK too, since I don’t believe the SGR is affecting facility fees in any way, so the impact of cuts is reduced, and hospitals will always find a way to make services profitable somehow.

  • Anonymous

    Does anyone have a tissue? Do you wanna doc fix? Let’s take all of your rejects, those elderly folks that live on $700 a month SS before the Medicare deduction, and let’s start a new health care program at stores like WalMart. Let’s take the payments you think are so insufficient and let’s ask WalMart if they can make something work for the old folks. You prima donnas make me sick! Your high end fee-for-service “designer health care” is way too expensive and will soon be replaced. As more and more hospital groups and insurance groups see the value of forming an ACO, maybe they will finally put fee-for-service (FFS) medicine in the grave where it belongs. Don’t tell me ACOs and just warmed up leftovers of the HMO era. They aren’t! In the new ACO model, fee-for-service ends. Doctors and other professionals in an ACO are employees and all receive a salary. Their mal-practice insurance is group insurance so it’s less expensive. These professional and salaried “employees” work regular hours and go home to see their families on a routine basis. Best of all, these new ACOs will be rated by their patients and so they will be paid according to wellness and good outcomes. They risk their profit margin and their funding if they don’t achieve wellness and good outcomes. In a nutshell, ACOs are nothing like failed HMOs, not even close! So, let’s celebrate the fact that greedy FFS doctors may soon be seeing less Medicare patients as they transition to “big box” medicine that ACOs will offer. Medicare doesn’t pay enough? Soon you small one-doc and two-doc FFS offices will get your wish. You’ll be seeing less old folks, won’t that be great!

  • http://twitter.com/ADI_Financial ADI Financial

    I would be interested to hear from docs what they think their gross margin is on patient care.  In other words, for every revenue dollar, how much does it cost to pay the physician(s) a market salary and cover the cost of assistants, supplies, and equipment usage?  Is it 50% or 40% or less?  If you take 27% of that revenue dollar away and still spend 50% to 60% to “service” that dollar of revenue, you’ll have less than 25% of each Medicare dollar left over to pay for the rent, utilities, billing, reception services, malpractice insurance etc.  I’m willing to bet there’s nothing left over, and if there is some operating profit remaining in that Medicare dollar, I’m pretty sure it’s not sufficient to support and reward the owner’s investment in the business.
    Learn more about new ways to think about your business performance at http://www.adifinancial.com

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