The Medicare data dump: How the government gave physicians the finger

According to a study by Jackson Healthcare, the percentage rate of U.S. physician compensation is among the lowest of western nations.  In 2011, physicians’ salaries compromised 8.6 percent of the nation’s total health care costs.  This is in comparison to 15 percent in Germany, 11 percent in France, and 11.6 percent in Australia.  Detractors point to the fact that although the percentages speak for themselves, if you look at the total number of dollars (per capita health spending in the U.S. is double that of the average for the twelve other OECD countries), physicians are still compensated quite well.  Either way, in our bloated costly system, physician services are comparatively already discounted.

So it was with great pomp and circumstances, as well as consternation from various physician sources, that the government released data for all payments made by Medicare to physicians in the year 2012.   Lauded as a win for transparency, the administration argued that making such information public would lead to a reduction in fraud, greater research into healthcare costs, and empower citizen investigators to crack the code of our overwrought system.

In reality, the so called “data dump” was exactly just that.  The information didn’t account for the percentage of each physician’s practice as Medicare versus private insurance.  There was no recognition of pass-through costs (medications, chemotherapy, etc.).  There was no adjustment for range or severity of illness of each physicians patient population.

Besides physicians, it is unclear that this information will really interest anyone.  The government already knows who are the largest Medicare billers; they were privy to the information previously.  The public is so overwhelmed with the ACA, surgical report cards, physician rating sites, and the like, it is unclear that they will take the time or have the expertise to actually interpret the data.

Previous studies suggest that patients could give a hoot about such information.  And even if they could, finding a doctor who takes their insurance and hasn’t been narrowed out of a network is hard enough.

I can assume that the only real reasoning to release such information was to send physicians a clear and unmistakable message.  We are being told not so subtly that we are being watched: “Get on board with what is happening, or there will be consequences.”

That’s right.  Our government just flipped us the bird.

Jordan Grumet is an internal medicine physician and founder, CrisisMD.  He blogs at In My Humble Opinion.

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  • Markus

    The Jackson Healthcare site that you point to in your first sentence says that American doctors are highly paid, not as a percent of total national care, but in absolute terms.
    American doctors have many issues and problems that the general public should be concerned about. The physician community should voice these problems in terms that the general public can understand. I doubt that complaining about being underpaid while referencing an article showing the opposite is helpful.

    • buzzkillerjsmith

      The point is that since doctor salaries are a small percentage of total HC costs, that paying docs less will do little to change those HC costs.

      In fact, the whole system is very expensive, so putting the blame for high prices all on us makes no sense. And that is what many do–put it all on us. That’s the point he’s making.

  • Patient Kit

    You’ll be amazed at the huge number of patients who will not be able to come up with enough cash to pay all of their doctors upfront and then fight it out with insurance for reimbursement. Large chunks of the poor, working class and middle class population will not be able to see docs that way. Docs aren’t the only ones hurting financially. I

    As a patient, I am already on docs’ side on many of the issues discussed here on KMD, but not if you all abandon me if I can’t pay you directly upfront. So, although I agree that doctors should be more fairly compensated, my question to docs would be: Do you want to decide to limit your practice to treating only patients with money? And, if yes, what would you suggest the rest of us do when we need medical care? Do you have any idea how many of us there are?

  • betsynicoletti

    But, the government resisted giving out this information, and only did so when sued by the parent company of the Wall Street Journal. They did release it when ordered by a judge to do so.

  • Patient Kit

    OK. I guess this identifies a disconnect and lack of trust on my part about this. Because I don’t trust that doctors will charge affordable fees. Why would patients just automatically trust that doctors will charge much more reasonable fees when we are constantly hearing that doctors want more money? The general trust in doctors has to be rebuilt stronger before many patients will trust the affordable fee thing will happen.

    And what kind of position are sick people in to negotiate a lower fee when they desperately need to see a doctor? I don’t think doctors will convince me or anyone I know that direct fee is the answer to our problems re the cost of healthcare. I’m sorry but direct pay is going to be a hard sell to most patients who don’t have a lot of money.

    • Mike Henderson

      These concepts definitely need more detailed explanation. Hopefully I can do this. To summarize, direct billing could lower your costs, but would take time.

      Ideally all primary care physicians would stop contracting with insurance companies. They would then lower their costs significantly. The estimates vary, but docs spend a third of their income just getting paid. Those costs would be reduced. Second, not dealing with insurance company rules would free up their time and boost morale.

      If insurance companies are no longer paying for office visits, they would have the opportunity to lower premiums to reflect those reduced costs. More likely they would keep the profits, which is my concern for why direct billing wouldn’t work well for patients.

      If insurance companies actually reduced premiums it would be because they are no longer making payments to physicians but are also not getting their 30% profit for everything they cover.

      Let’s look at things going forward.

      • Mike Henderson

        ….forward. If your doc is receiving $70 to see you, you had to pay over $90 to the insurance company. Your doc had to spend over $ 20 to get paid, leaving less than $50 to pay the rest of overhead. In other words you paid over $40 that went to the billing process, which is just about what your doc was effectively able to get for your visit. What if you doc charged you directly $60 and was able to spend more time with you? You theoretically could get more time for less money if the middleman insurance company was cut out.

        • Mike Henderson

          I forgot to add that the exorbitant charges patients see that are sent to the insurance companies are part of the game that is played between providers and insurance companies. If we stop playing those games, there is no need for balance billing. But like you point out, trust needs to be built first and some plan developed to bridge over smoothly as patients are generally financially tapped out.

          Hope that helps.

          • EmilyAnon

            I’ve always been confused by the huge difference between what is billed and what insurance pays out. Can the provider at least take advantage of the loss with a big write-off at tax time?

          • Mike Henderson

            Unfortunately, I don’t know if the loss can be written off. I would assume it could be, but don’t know if this is really an advantage as I haven’t heard of this being promoted.

            The reason for the exorbitant mark ups is this: insurance companies pay the lesser of what you charge or what they allow. Therefore, every service you provide has to be over what every insurance companies allows. There has to be a systematic way to raise all of the prices and thus there is a lot of padding to the price. For example, most companies will pay $35 for an EKG, but one will allow $50. Because physicians have lost control of what they are paid for and what they actually get paid, they are driven to get maximum reimbursement for every single service provided. If you are a patient and inquire about the prices a physician charges, those prices were produced with billing an insurance company as the goal. In my mind, price lists have little to do with their actual costs.

          • Patient Kit

            I think a lot of patients, myself included, believe that those exorbitant fees on our statements next to the fees actually paid by insurance are the retail full prices that doctors would charge us if we didn’t have insurance. And we’ve all heard plenty of horror stories about uninsured patients actually being charged, by both docs and hospitals, far more than what most insurance pays. If that is not true, then patients need to be educated about this pronto.

          • EmilyAnon

            At my hospital, what they bill insurance is the same as what they bill a self-pay. They will deduct 20% if the self-pay patient pays in full in 30 days.

            Just for example, one chemo session was billed to my insurance for $22,700. Blue Cross paid $12,030 (2006 prices). And I had 9 sessions which comes out to the hospital receiving $108,000. A self pay with hospital discount would be $163,000. Surgery, hospital stay, labs, etc. of course are in addition. If I didn’t have insurance I probably wouldn’t be here today. Who could afford that out of pocket.

          • Mike Henderson

            The pricing that providers concoct to charge insurance companies are just part of the game and is difficult, at least for me, to explain. Those prices are really just a starting point. By law, everyone has to be charged the same. Your doc can’t charge you one price and the insurance company another. To maximize reimbursement from every insurance company for every service, the prices are inflated well above their true or reasonable cost. It is similar to the way cars are marked up, but patients don’t realize the full price is negotiable. Many providers also don’t seem to realize that negotiating with cash paying patients is to their advantage.

            However, docs can have a cash, paid at time of service price list. These prices should more accurately reflect true cost. This makes sense for typical office visits, but not hospitalization, surgery or chemo.

          • Patient Kit

            In discussing payment models for healthcare, my POV is always coming from a patient who is currently being treated for ovarian cancer. I’m NED now but it could recur at any point. I’m only one year out from initial dx. Maybe this is why the idea of direct pay is one more level of terrifying to me — because it sounds like a potential giant barrier to care to me. I’m not thinking in terms of only needing an occasional routine primary care office visit for some one-time mundane problem.

            To those “healthy” patients who feel like they don’t need much healthcare anyway so why pay for coverage of things you think you’ll never need: That serious diagnosis can come quickly and suddenly and very unexpectedly to any of us. That is one thing that every single one of us have in common.

          • Mike Henderson

            The idea behind direct pay is that quality should go up and overall cost go down – at least that is what I would expect if most primary care physicians did this and had true competition keeping prices in line.

            If primary care physicians have enough time, this would generally reduce the number of tests, medications, procedures and referrals. You pay for all of these through premiums and pay the insurance company to administer the plan. Currently we deal with the lack of time to treat patients by overutilizing medical resources, again, which you or someone else pays for. With fewer tests and visits, your overall costs would come down – that’s the hope anyway.

          • Patient Kit

            Emily, first, I’m so glad that you had good insurance, were able to get the care you needed and are still with us today. Those numbers are terrifying. In the year and a half since my cyst that turned out to be ovarian cancer was found, I’ve been in three different insurance situations (Blue Cross to uninsured to Medicaid). Now, as I’m on the verge of going back to work, I’m also on the verge of becoming uninsured again once I start receiving a paycheck. If I become uninsured again, there is no way that I will be able to afford to pay for the followup care and monitoring I need every 3 months. Every step of the way, since the day I was diagnosed, I have been living with that ax hanging over me, threatening to cut me off from access to the medical care I need. It’s horrible that our healthcare system makes people live in this kind of fear while they are battling cancer. Before all this happened, I had the same Blue Cross plan for 20 years until I got laid off. People who think they are covered, especially by employee-based insurance, shouldn’t get too complacent. It can disappear unexpectedly just when you really need it.

          • EmilyAnon

            Kit, I so understand your anxiety about being uninsured with our type of cancer. But it isn’t a given that a recurrence is in your fuure. I’m still here 10 years from my stage 3C diagnosis. From stories on the ovca online support community some patients in need have been treated pro bono. In fact one was operated on by my surgeon that way. Supposedly some hospitals and doctors set aside spots for compassionate care, even free drugs are available from pharmaceutical companies. I think there is a searchable list on the support group site.

            You said you like your surgeon very much, would you be comfortable to ask him the ‘hypothetical’ question about his policy toward treating uninsured patients? What gets me is that if the doctor/hospital accepts medicaid payment, why can’t the uninsured patient just pay that same amount out of pocket. I know, it’s against the law or policy or whatever.

            About my healthplan, the PCP staffed clinics have just been bought out by UCLA, which you might think is positive, but our doctors feel otherwise. If the change worries them, then I’m worried too.

          • Patient Kit

            Emily, I understand that, thankfully, my cancer won’t necessarily recur and your story is a source of real hope and inspiration for me. Thank you. I am still in the time period in which it might more likely recur, so I’m trying to stay vigilant and stick faithfully to the follow up monitoring plan.

            I actually saw my wonderful GYN ONC yesterday morning for what was my one-year post-surgery check up. He picked up right away on me being more stressed out than usual and so he asked me how I’m feeling emotionally, which opened the door for discussing my stressful insurance situation. He expressed a lot of concern and compassion and is willing to do anything he can to help me. First, he’s going to give me a letter about my surgery and cancer dx that emphasizes how essential it is for me going forward to continue to be monitored for cancer every 3 months. There is a special cancer program within Medicaid that I might qualify for that I’m going to try for first. If that fails, I do feel like I can talk to him about whether he, as a doc based in a teaching hospital, has any other options that he can help me access within the hospital system. He doesn’t want me to skip seeing him for a year and then come back at some point with a more advanced recurrence any more than I do. I’ve never trusted another doc this much in my life, so I hope we can come up with something together to make this system work for me. I may be about to start a full-time freelance job that pays $20/hr but comes with no healthcare benefits. So, we’ll see if Medicaid will continue to cover me under their cancer plan if I get that job. I’ll just be making enough to cover my rent and monthly bills. There won’t be enough income to buy insurance and pay high copays and deductibles. I’m continuing to look for a job that does come with healthcare. But in the meantime, I’ve been thisclose to becoming homeless and need some income to keep a roof over my head.

            I hope your docs being acquired UCLA works out well for you. Try to remember that my terrific doc is hospital based in a system similar to UCLA (NY Presbyterian with Cornell and Columbia U med schools) and I don’t ever want to leave this doc. There are some down sides, to be sure, to being part of a big system like UCLA. But there are some up sides too. I hope it turns out to be good for you.

          • EmilyAnon

            Kit, your doctor sounds like a gem. I’m so glad for you. In my situation, I hate change when things are going well. There’s a lot going on that I’m not privy to, but my docs don’t seem happy, so that worries me. We’ll get a notice at the end of the year as to who and what will be affected. Meanwhile we just have to carry on.

          • Mike Henderson

            Physicians are required to charge the same price to everyone. Those prices you see are really intended for insurance companies. In another post I explain this in more detail. Unfortunately some patients are charged the full “retail.” In a nutshell, those prices are meant to maximize reimbursement from every insurance company for every service. There is a lot of padding well beyond the true cost of service.

            However, cash payment at time of service can be much lower. If you are paying cash, absolutely ask up front for a discount. I respect patients doing that as I know the typical list prices are primarily intended to be sent to an insurance company. Cash up front is cheap to collect.

          • Patient Kit

            Let’s see if I understand this correctly. All healthcare providers (doctors, hospitals, labs, imaging, etc) routinely severely inflate their fees to maximize what they will actually get from insurance companies? Why do you have to do that if there are already set agreed upon contracted fees that insurance will pay and providers have agreed to accept?

            Then, by law, you have to charge uninsured patients those same inflated rates? I knew about the really high bills patients get but I didn’t know why. And, to be honest, knowing why doesn’t really make it any less scary for uninsured patients. So, those fees might be negotiable, depending on whether the provider is willing to negotiate? But only if the patient has the entire chunk of negotiated fee in cash the same day?And we’re supposed to go to docs who barely know us and, what?, hope they will be willing to negotiate with us? A moot point really unless we have all the cash available immediately.

            I think the uncertainty of this kind of direct billing is too scary for me to deal with on top of the uncertainty of cancer.

            So, during my uninsured months after I lost my BC after

          • Mike Henderson

            Starting at the top of your post, yes the supposed list prices are meant to maximize reimbursement. In the state I am from, when Medicare released hospital charges, it was clear that cost varied widely. The key to understanding is knowing the insurance companies don’t publish what they will reimburse, each company reimburses different amounts and providers have to have a set amount of charges and finally, they pay the lesser of what is allowed versus what the provider charges. So, if a provider charges $35 and the insurance company “allows” $50, they reimburse the $35. You have to imagine that a hospital has thousands of services and products they charge for. The goal of the game is to make sure that every charge is higher than what is allowed by every insurance company. It is considered leaving money on the table to not get every dollar an insurance comany will “allow.” Consequently, patients see these outrageous prices and think to themselves “I need to get insurance.” The insurance companies have providers playing the game, forcing patients to get insurance. which is why the prices are so high.

      • Patient Kit

        I do understand how direct pay could be good for private practice primary care docs. But I do not see how it would be good, financially, for most patients.

        First, I don’t believe for a minute that if our insurance stops covering primary care that they will pass the savings along to patients. I think it’s a sure bet that insurance companies will just keep bigger profits for themselves. And then, I will have the direct cost of primary care in addition to my insurance costs but those primary care direct fees will no longer count against my deductible. And with doctors constantly saying that they need more money, I don’t really trust that doctors will pass any savings along to patients either.

        I’m open to hearing more about how this would work in patients favor financially, but right now I just don’t see it at all. I do get that it would be better to have happier docs who have more time for us. But it still has to start with being able to afford you.

        • Mike Henderson

          Your points are valid. I don’t have any reason to believe the insurance companies would pass any savings through to patients. This is the primary sticking point as to why this wouldn’t necessarily work well for patients.

          However, I do believe physicians would more likely than not charge reasonable fees. We are well aware that patients are financially strapped and most won’t go for it. We do have incentive to be charge reasonable, realistic fees. Unfortunately, as you point out, the fees wouldn’t be deducted from the deductible. Insurance companies want to be the middleman and make patients think they are protecting them from gouging by physicians – they are a wolf in sheeps clothing. In my opinion, they are the ones gouging patients.

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

    Is it? So people get hit by insurance companies with high premiums and high deductibles, get hit by government taxes to pay for health care, get hit by employers who won’t let them have even a tiny sliver of “productivity gains”, and now you want permission to hit them again?

    The reason primary care is not paid enough to function correctly is not that people don’t already pay too much for health care. The reason is that someone else is redistributing their money to the most powerful “stakeholders”, a.k.a. common thieves.

    You (just like everybody else) are being robbed by those high above you, not by the masses below. Who do you think owns the WSJ, the requester of physician data? The less money you make, the less they can pay their “workforce” and keep it calm and “productive”. Nothing is simple anymore…

  • Patient Kit

    Sorry, but no. Balance billing is not the “simple solution” to the cost of healthcare, at least not from the patients’ POV. Maybe I’m misunderstanding what you mean by balance billing, so please correct me if I’m wrong.

    Are you saying that when docs sign contracts with Medicare, Medicaid and private insurance agreeing to accept a specific “negotiated” fee as full payment, that you should be allowed to bill for a fee higher than what you agreed to accept as full payment and bill patients for the balance? Like, for example, in order to see Medicaid and Blue Cross patients, you agree to accept $30 and $70 respectively from them as “full payment” but you bill for $150 and bill the patient for the balance of $120 and $80? Did I get that right?

    • Dr. Drake Ramoray

      You have balanced billing correct however we don’t negotiate fees with Medicare/Medicaid. You accept assignment and then they charge whatever they want. I am not in favor of balanced billing as the solution either, but you suggest that we have negotiating power with Medicare/Medicaid where we do not. We take their rates or don’t see their patients. There is o negotiation.

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

        From what I can tell, except in some very unique circumstances, small practices and small hospitals have no real negotiating power with private insurance either…

        • Dr. Drake Ramoray

          This is true and is part of the effect of the consolidation of medicine and economies of scale. Don’t see many mom and pop hardware stores do you?

          That being said there is a stark difference between being in a poor negotiating position and there being no negotiations at all. Many on this blog prefer a single payer system, and I for one would have to have the right to collectively bargain if it’s even going to be on the table.

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

            I prefer a tax financed system. I guess it’s a single collector system. Whether single payer or regulated not-for-profit multi-payer is in my opinion irrelevant.
            I would insist on your right to negotiate because I think labor has a right to argue for its prices, just like capital has a right to argue against its costs. If you want to trace the source of all our problems right now, including health care and doctors’ pay, you will end up with the neutering of labor unions.
            It’s no accident that physicians are now starting to talk about unionization. People that make a living with their hands are all considered labor, even if they have to use their head in the process, and the high-water mark has now reached the highest payed labor. It will get ugly fast…

          • Dr. Drake Ramoray

            I don’t discount that these systems work (with their own set of drawbacks) in other countries (I have in the past and may consider in the future moving to one of them to practice medicine).

            That being said you have more faith in the US government than I do, and that makes this discussion move far beyond the scope of this article. Lets just say our current system looks like what happens when a republic, a democracy, and an oligarchy, have a trist at a crony capitalism convention and you get our current government.

          • NewMexicoRam

            Now that I can agree with.
            You may want to see the graph on the medical blog called The Incidental Economist. Today’s version has an article about Medicare costs and doctor’s reimbursement. Look at the graph accompanying the article. Compare the inflation rate with doctor’s pay. It’s astounding.

      • Patient Kit

        I tried to acknowledge your lack of negotiating power with both government and private insurance by putting “negotiated” in quotations but, admittedly that was too subtle on my part. Plus, I was focused on the proposed concept of balanced billing as a “simple solution”.

        I can see how being able to balance bill patients would benefit private practice primary care docs, to a point. But I fail to see how it would benefit patients, financially anyway. Theoretically, we’d have happier docs who could spend more time with us.

        BUT…If patients still have to have insurance to cover everything but primary care visits, then we still have the same high premiums, deductibles and copays but our insurance no longer covers primary care. If you think eliminating coverage of primary care will cause insurance companies to lower costs for patients, I have a bridge to sell you. So, instead of paying a $25 copay, patients start paying a direct $100 to their primary care doc. And no primary care costs count toward the patient’s insurance deductible. Wouldn’t this balanced billing or direct pay concept have to make healthcare more expensive for patients? Not less expensive? I’m just not seeing how this would be good for a lot of patients.

        • Dr. Drake Ramoray

          Hi Kit
          Always good to here from you. I noted your quotations but there is not subetly involved as there is absolutely no negotation with Medicare/Medicaid. You either see patients at the dictated rates or you don’t. There is no air qutoes, quotations, or subtely involved. You are told the rate and you accept it your don’t.

          I agree however that this conversation format is ideal as you are continuing to argue against balanced billing from the patient perspective when I clearly stated I wasn’t in favor of balanced billing as a solution for patients or doctors.

          I just wanted to be clear that there is absolutely zero negotiation with Medicare/Medicaid in erms of reimbursement which is why I commented in the first place :)

          • Patient Kit

            Hi “Dr Ramoray”. Always good to hear from you too, especially since I was under the impression that you are fictional and met your demise in the elevator shaft after you dissed your writers by claiming you make up your own lines. ;-)

            I’m sorry that I wasn’t clearer in my earlier response. I do understand that doctors don’t negotiate with Medicare and Medicaid at all and that you only agree to their terms so that you can see “their” patients. I just think that trying to change that non-negotiable situation is a better place to focus than on how to get more money from patients. I also didn’t mean to continue on my rant about balance billing to you. I do know that you said you do not personally think balance billing is the answer. I guess the idea (not put forth by you) that balance billing is the “simple solution” set me off and, once wound up, sometimes I keep going and going like the Energizer bunny. Breathing now and absorbing all that you said.

          • Dr. Drake Ramoray

            “I just think that trying to change that non-negotiable situation is a better place to focus than on how to get more money from patients.”

            Yes, yes it is.

            “met your demise in the elevator shaft…..”

            You forgot about my brain transplant with soap opera star Susan Sarandon being the donor.

            http://www.youtube.com/watch?v=HxKY2Z9ymTA

          • Patient Kit

            LOL! Perhaps I’ve had way too much general anesthesia over the last 3 years and now I need my own new brain. Susan Sarandon’s would be a good one to get. Love her!

        • Mike Henderson

          I assume you have or will see my post below. Regarding the cost to see a physician, also add in the premium to the you paid the insurance company: to use your figures from another post, you pay over $90 premium, the insurance company pays the doc $70 (keeping roughly 30% for overhead) and the doc pays over $20 to get the $70. You paid over $40 in premium for the doc to get paid roughly $40. The “true cost” of that visit for you is over $115, not just a $25 copay. In direct pay, a physician could charge you $60 or even $80 and you theoretically would save money. The doc would double their income, could therefore spend more time with you. Spending more time in my own practice means I can listen, answer questions, educate and minimize unnecessary testing, referrals and imaging. I also have more incentive to do more for you each visit instead of fragmenting your list of concerns – you may also save money as you wouldn’t have to have as many visits.

          When we lose control of what we are reimbursed for and how much, the only variable we can control is volume of patients seen. To increase volume, one must reduce the level of service provided during each visit. You therefore may need more appointments and disruptions to your schedule.

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

            Unfortunately, the math doesn’t work this way anymore. Most people now have high deductible insurance to the tune of over $6,000 per individual (under ACA). People pay out of pocket for primary care, and for other things too.
            Here is the “funny” part though: insurance companies are effectively “balance billing” their customers when it comes to direct pay, because it is not applicable to the deductible.
            I know some DPC are making headway in this area, but those are big corporate DPC practices that can negotiate with payers/employers. Insurers need to control the primary care “provider” to make sure that you don’t trigger secondary and tertiary expenditures on behalf of the patient.
            We all need to mobilize against your loss of control over how premium funds are allocated. That’s where the money is, and that’s where the power is.

          • Mike Henderson

            I would say the math doesn’t work that way as much as it used to. For those whom that math doesn’t apply there is another way to look at it. Most people who have high deductibles won’t likely reach their deductible in a given year. Consequently, the fact that direct payment won’t be applied to the deductible won’t have any effect on their expenditures. Instead of focusing on the dollars, they should focus on value. Going to a preferred provider and paying a higher price while getting less service to have the fees applied to the deductible when the deductible will likely never be met, isn’t much of a value. Going to a direct primary care clinic, paying less and getting more service, I think, is worth the trade off of not having it applied to the deductible that won’t likely be met anyway.

            We have painted ourselves into a corner with insurance companies as the middle man. Reversing course will take many steps and back and forth between patients and physicians. Direct primary care will not work if suddenly and universally implemented. It needs to start with those that can afford it. My hope is that as the advantages become apparent, costs can go down, more people can afford it and so on. I do admit that exactly how it would actually turn out is beyond my imagination.

          • Patient Kit

            I did see your post below and have responded to.you there. I apologize for the delay in responding. Believe it or not, I’m doing all this posting from my phone between medical and job hunting activities, sometimes on a crowded bumpy city bus. This Friday, I have a GYN ONC appointment in the morning and a job interview in the afternnoon. Sadly, that means I have to wear a suit to the doc’s instead of easy access clothing. ;-) But getting back on topic, I have to agree with Margalit. From a patient’s perspective, direct pay primary care added to a high deductible insurance plan for everything else does not add up to less expensive healthcare for patients. I sincerely wish it did.

          • DoubtfulGuest

            All the best for your interviews, PK! (Don’t) break a leg.

          • Patient Kit

            Thanks very much, DG. Both my morning GYN ONC visit and my afternoon job interview went very well today. Need a Friday night margarita now after a swim.

            Still no computer between me and my GYN ONC (or his resident), BTW. They do anything on the computer outside of the exam room and just talk to me and examine me when they’re with me. :-D

        • NewMexicoRam

          Who said anything about eliminating coverage for primary care? It would only create a larger Co-pay– like medicare used to be prior to 2000. It would be good for patients because maybe more medical students would go into primary care!

          • Patient Kit

            Thinking about this some more, both private and government insurance have no incentive to provide a product that covers everything but primary care because insurance does want patients to see primary care doctors. In many cases, they want us to see primary care before a specialist. That creates a situation where patients are going to primary care soley to get a referral and both patient and insurance have to pay for two docs instead of one. And that’s a whole other issue. But, yeah, for various reasons, you’re right that insurance probably won’t stop covering primary care. So, insurance isn’t getting any less expensive for us.

            That said, I still think primary care docs should be paid more by the insurance companies, not by their patients. What I hear you saying is that you don’t have any power with the insurance companies to negotiate a more fair reimbursement from them. But you do have power over your patients to say,”If you want me to help you, you have to pay me more”.Go for it! But unless you already have really great relationships with all your patients, they’re not going to love you for making that power move on them.

          • NewMexicoRam

            Wrong, my friend. As long as I am willing to contract with the large insurance companies or the gov-ment, I have NO way to make patients pay more. So, unless I go solo and create a direct pay practice, I cannot charge more. I either see more patients, creating a patient satisfaction problem, or have to be satisfied with more work and less pay. It’s really that simple. Until docs strike, there won’t be any more money from payers.

          • Patient Kit

            Wrong about what, specifically? I understand that you can’t make your insured patients pay more now. But that’s what you want the power to do with balance billing, isn’t it?

            I think I do understand your dilemma, but I’m not getting the impression that you understand my dilemma at all as a cancer patient trying to survive in this system. And I think what really sets me off is your trying to frame this as something that has a “simple solution” because I don’t think any solutions will be simple or easy.

            I’m sincerely sorry that you’re going through such a stressful time right now. But so am I. Try being a cancer patient with limited access to healthcare and the constant threat of being cut off completely. You talk about doctors striking like it’s a threat. I’d love to see it happen. I’d love to see doctors get more organized and empowered. As a patient, I don’t see that as threatening. I just want to know when the heck you’re going to get around to actually doing it.

          • NewMexicoRam

            Then why can’t the insurers and gov-ment give me, as the doctor, the right to charge extra as I feel is needed, along with the right NOT to charge anything extra? As it is now, by law and by contracts, I still have to collect co-pays, even from patients I know can’t afford it. That’s all I’m asking for–freedom. If you were my patient and could show me you couldn’t afford the extra, that’s fine by me. No problem–I wouldn’t charge the extra. But don’t make your situation the norm for everyone else who are in the majority and can pay the extra. So, I still say it’s a simple solution. As least better than we have now. We all know nothing is perfect.
            If doctors strike, it will be just for the reason you are arguing against, yet you say you would support it. That is, the right to charge additional fees.

          • Patient Kit

            On the subject of balance billing, I think you and I will just have to agree to disagree. You will never convince me that is in the best interest of most patients to pay more for primary care. I certainly don’t want to see it for my Mom who is covered by Medicare. It would be great if docs had the freedom to charge more or less, but it’s asking a lot of patients to trust you on that when your constantly saying you want more.

            As for you seeing my situation as out of the norm and feeling that the majority of patients can afford to pay more, let me assure you that there are millions in situations similar to mine out here. If your particular patient population can truly all afford to pay more, then maybe going direct pay or concierge is the individual answer for you. Go for it. Stop taking insurance. If you do, I hope it works and and you are happy. Just don’t ask me to support the idea of all primary care in this country going that way. I think it’s fine for a niche but it would make primary care too inaccessible for too many if it was the “norm” in primary care.

            Clearly, you and I, each in our own way, are under some extraordinary personal pressure. We both have to do whatever it takes to survive. I sincerely wish you well.

    • ninguem

      Well, then in that case Kit, why not ban balance billing, AND set the fee schedule to one dollar for an office visit?

      Instant solution to the cost of medical care.

      Other countries, some considered our Betters in healthcare organization, do allow balance billing in their own systems by the way.

      http://www.lemonde.fr/sante/article/2014/03/05/medecins-des-depassements-d-honoraires-de-56-3-en-moyenne-en-2013_4378184_1651302.html

      The French don’t like it, but the reality is, if the system continues to ratchet down payment, it’s inevitable.

      The original enabling legislation for Medicare, by the way, specifically allowed physicians to balance bill. Don’t be surprised when doctors look at this skeptically, as the docs were lied to in 1965.

      • Patient Kit

        I’m not at all saying that doctors visits should be $1 or that there are any instant easy solutions. In my currently cash-strapped case, that’s why I’m temporarily on Medicaid. And, no, I don’t think I should be billed for the balance between the inflated fee the doc submitted and the fee he agreed to accept from Medicaid.

        An uninsured friend came home upset from an office visit with her private practice GYN. She was upset because of her surprise bill. The laser procedure itself was $178. OK. But she was charged $662 to numb her. She said, had she known that, she would have had it done without the numbing. And she was charged $302 for a mandatory pregnancy test before the procedure even though she knew for sure that she isn’t pregnant. Isn’t $300 for a pregnancy test in a doc’s office a little excessive?

        This is why many patients don’t trust their docs when it comes to billing. And, really, how many detailed discussions about cost, do you have with patients BEFORE you see them and treat them?

  • Lisa

    A ‘job action’ where you stop seeing patients for three days is quite different than limiting your practice to those who can afford cash payments. Quite frankly, though I think such a step has the potential to backfire as the American public has been socialized to oppose unions. Unions are blamed for much that is wrong with this country. I don’t know if a doctors union will gain much traction. Btw, I am pro union.

    • Patient Kit

      I’m pro-union too, Lisa, and I agree that the vast majority of our country is anti-union. So, organizing a union is never easy. Not even here in NYC, let alone in TX and AL and FL. That said, some of the more successful unions that still have some leverage for their members are those that represent higher-paid professionals like actors, pro athletes and airline pilots.

      Following one of those models, I think a strong doctors union is possible because I think most people still think of doctors as both valuable and needed. The thing that doctors have to understand though is that any union is only as strong as it’s active members and good leaders. It’s not just a passive thing that you just pay dues to join, get a membership card and then do nothing.

      • Lisa

        If a doctor’s union is to work it can’t simply be about dollars for doctors. Part of the union’s goals has deal with the affordability and accessibility of health care for the average person.

        • Patient Kit

          Agreed. There is very little support from the public for any union that is perceived to be fighting solely for higher wages for it’s members. It has to be about far more than that.

  • buzzkillerjsmith

    Good info on the percentage of HC costs that physicians earn. I did not know that.

  • DeceasedMD1

    Because they are too corrupted and weak to go after the elephant in the living room

  • SherryH

    As a proponent of transparency I agree and disagree. Bringing prices to light is imperative to the process of health care reform. However, I just don’t think that the information coming out (what docs make on Medicare etc.) is very useful to the average person. From a patient point of view, it’s not the kind of transparency that I need, nor is it helpful to me in making choices, and I am guessing many would agree.

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

    Everything “they” are doing to you is just a byproduct of limiting the amount of money spent on people’s needs, whether by government, employers or people themselves. Every dime saved on “health care” goes into a corporation pocket. The best scenario would be to convince people that they don’t actually need doctors, and this is working rather well now. The second prong of this campaign is to convince doctors to stop worrying about individuals and start paying attention to “populations” because that’s how you optimize productivity. Many of your colleagues are playing along just fine.
    There is a small window of opportunity here, but it is closing fast (Buzz would probably say that it is already closed). People would JOIN you by the millions if there was something to JOIN. I don’t know how many more ways I can say this, but you need to stand up and lead this fight, or at least just stand up. And the message has to be right. It can’t be “let’s fight for my right to charge you more money”. I don’t care if theoretically this is the right concept or not. It doesn’t resonate well (to put it mildly).
    Let’s fight for your right to get proper medical care, or let’s fight for your right to see any doctor you want, or let’s fight for your doctor’s ability to be your advocate, or any combination of the above…. Even better, let’s fight for your right to share in the wealth of this nation, which you helped create, so that you can afford to see a doctor that’s on your side.
    Doctors who serve impoverished people don’t make as much money as those who serve a solid middle class. It is in your best interest to argue for an end to exploitation and massive inequality. It’s not a lefty concept. It’s just common decency and self interest.

    • Patient Kit

      I totally agree with everything you’re saying, Margalit. I do think patients would join this fight with doctors, but doctors have to start something for us to join. And, as you say, the main message cannot be about getting more money for doctors even if we hope that will be one of the ultimate end results for them.

      Where is that organized effort by doctors to fight back? Surely, there must be some activist docs out there? Some docs who can provide strong leadership to a doctor-patient movement against the powers that be for changes that would benefit both of us?

      All I keep hearing from docs is a pervasive “can’t do” attitude, an aversion to taking the risks that such a movement requires, a desire for someone else to do this for them and way too much talk about wanting more money, if not from the powers that control the money (because that would be hard), then from their easier low-hanging fruit sick patients who are even worse off financially than their docs.

      It’s as if no doctors have ever run a revolution before! :-)

      • Mike Henderson

        “All I keep hearing from docs is a pervasive “can’t do” attitude, an aversion to taking the risks that such a movement requires, a desire for someone else to do this for them…”

        Physicians can blame the insurance companies, lawyers, patients and politicians all they want. Won’t change a thing. I can change myself but not anyone else. We first must look at ourselves and change. Because of our position, knowlege and intrinsic alignment with patients we have the opportunity to effect positive changes, mutually beneficial to patients and physicians, in the system. I am blind as to why we aren’t more effective. Allowing things to go on as they are is only going to increase the dissatisfaction and is much more difficult to bear than change at this point.

        • Patient Kit

          I think a lot of peeps don’t truly understand what hard work true activism to effect real change is. Activism is not just a bunch of fringe lunatics uselessy protesting. Without real activism, we wouldn’t have, for example, civil rights, disability rights, gay marriage, environmental protections and as many non-extinct animals. Harder fights than healthcare reform have been fought and won in this country. I truly believe that an effective doctor-patient movement is possible. We need something like what is happening here in the discussions on KMD to explode and multiply. We need some true, brave and committed leaders to step up from both the doctor and patient segments of this coalition. We need peeps, both docs and patients, to start believing this is possible. Not easy but possible.

    • Mike Henderson

      I absolutely agree that physicians need to start advocating for ourselves instead of continuing learned helplessness with Medicare/Medicaid and the insurance companies. Not only do we need to do this for ourselves, but patients as well. When I was practicing primary care, my impression of the relationship I had with my patients was unethical. I knew that to make enough money to pay taxes, overhead, loans, support my family, and save for retirement, meant I had to shortchange my patients. At some point, that shortchange would lead to a bad outcome. I needed to see over 30 patients per day, or less than 15″ each. I knew very well the sicker patients were concerned I couldn’t spend enough time with them, and I also knew if they went anywhere else, they would get the same “short end of the stick.” I didn’t obtain an undergraduate degree, spend thousands of hours studying and training to be a physician to be treated or treat patients this badly. Unacceptable, and I no longer technically practice medicine.

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

        I was afraid that you will end up on the note you did. We have a problem, a big one, and we are not going to solve it if the best and brightest walk out without a fight. I am not judging your personal decision here, and I hope that wherever you are now, you can still summon the will to contribute some effort towards an equitable solution.

        • Mike Henderson

          I understand your comments well – I haven’t given up and agree that not practicing medicine is not a good thing. I have been taking a break. Currently I am in the beginning stages of working with a direct primary care clinic in a rural area.

          I am also trying to talk to local physicians about doing something, but so far haven’t gotten anywhere.

    • Eric W Thompson

      Medicare and Medicaid are government paid. The money they do or do not pay out does NOT go to corporate. It either goes to the bloated government or less charged to the tax payers.

      • ak123

        Medicare advantage certainly goes to corporate. When a medicare patient is seen in a bloated bureaucracy like USC, the money goes to corporate and the physician only sees a thin sliver.

  • Patient Kit

    A simpler way to say why docs continue to participate in insurance, Medicare and sometimes Medicaid is because that is where the vast “supply” of patients (aka customers) is. The supply of uninsured patients with ample cash flow is severely limited. There aren’t enough of them to go around to keep most doctors working. An elite few docs would quickly snap up those few elite patients who can afford to pay cash for healthcare.

  • Patient Kit

    I would be happy to see doctors take that kind of action. I hope it happens. And patients could be organized to take parallel action to support you. But your focus needs to be on demanding things like getting more negotiating power with insurance and the government so you can be paid more fairly by them, not on getting the greenlight to get more money from your patients.

  • Patient Kit

    I agree that any crack in the culture of secrecy is a hopeful step toward potentially gaining more transparency in the future. Change has to start somewhere and almost always starts imperfectly.

  • Patient Kit

    I don’t disagree about the evil middleman insurance companies and I would welcome a culture of doctor volunteerism and Good Samaritans. And it is strange that I trust some of my docs with my life but not with my wallet.

    My problem is that I have cancer NOW and have no money at the moment. I need access to medical care now. Maybe a little personal history will help you understand where I am coming from:

    My cyst that turned out to be ovarian cancer was initially found by a private practice GYN while I was still covered by Blue Cross from my former employer. Knowing that I was about to lose my BC, this doc told me that I needed major surgery asap, impressed upon me that it was serious and likely cancer and said I needed to “find the money” for surgery. I saw her one more time after I lost my BC. She wouldn’t even let me in the door unless I gave her $100 cash. She wouldn’t accept a check or credit card. Then, while in stirrups on the exam table and being told I probably had cancer (talk about a powerless position!), she asked me who I was voting for and said that if I voted for Obama I would get what I asked for. I’m never scheduling a doctors appointment on Election Day again, btw.

    Next thing I knew, I was out her door for the last time, on the street in shock and left to find a new doctor on my own. Knowing I likely had ovarian cancer, which I did, I spent the next 4 months uninsured and unable to see any doctor. Once I qualified for Medicaid, I ended up in the hands of a wonderful GYN oncologist at one of NYC’s teaching hospitals. I got the surgery and follow up treatment I needed. He is one of the best docs I’ve ever had and I’d like to keep him. I do trust him with my life. My former private practice GYN, I wouldn’t trust with anything.

    So, yes, I guess I feel recently burned by a private practice doc who told me I had cancer and then abandoned me when I no longer had insurance and couldn’t magically “find the money” for surgery.

    I am sincerely interested in working with doctors and patients to reform our system and make it better for both of us in the future. But, first, for me, there is the pressing issue of actually physically surviving into that future.

    But what is going

  • PoliticallyIncorrectMD

    Releasing this data had nothing to do with transparency, it created an appearance of it. The released data is inaccurate ant therefore misleading. Best case scenario – it is useless (garbage in, garbage out). Worse case scenario – it is part of the well orchestrated effort to blame physicians for inflated healthcare expenses and destruct public’s attention from real offenders. Based on your response, the strategy is working quite well.

  • Patient Kit

    Patients sign agreements with doctors all the time too without negotiating any of the terms in those agreements. So, I do understand your frustration. As for getting real, here’s my reality: I have cancer but no cash. A door that stays open but that I’m not allowed to walk through unless I can pay, looks like a closed door to me.

  • EmilyAnon

    Thank you Dr. Oakman and Dr. Henderson for taking the time to explain. The healthcare industry has cancer patients over a barrel. I have nightmares wondering when my access to treatment will come to a screeching halt.

  • Eric W Thompson

    People assume that if we got rid of the insurence companies all would be well. I believe that is wishful thinking. Americans seem to demand a lot of treatment. When I was in Europe, it seemed that patients were taught how to live with conditions rather than say have a joint replacement. I would be for single payer if people were taxed the full amount to support it. To provide equal care at a high level would require extremely high taxes.

    • Patient Kit

      I have been paying high taxes for my entire adult life that support our public education system, regardless of whether I have kids in the system. I’m fine with funding a good single payer health system with taxes. Routine medical care is something that every American needs and serious medical care is something that every American could potentially need. We need a system that provides that. Employers have been screaming loud and clear that they are struggling continuing to be the main source of health insurance. If not employers, who? We can’t all buy insurance individually. So government is the only obvious alternative to employer-based health insurance. If there are any other options besides (1) employers, (2) government and (3) every man for himself, I’d live to know what those alternatives are. Keep in mind that the goal is to provide good accessible medical care to all.

      • Eric W Thompson

        I am all for single payer. As long as there is a separate line item of the pay check for health taxes as with medicare and SS. And that the tax taken covers the full cost of the system. With the requirements put on the ACA so far that is somewhere around $1000 a month unless the care is limited.

        BTW the public schools mostly are poor and trending worse even as the tax paid to cover education goes up.

  • ak123

    I also discovered some new oxymorons, such as hospice critical care time.

  • Patient Kit

    I definitely think Medicaid and Medicare should pay doctors more (via my taxes). I just don’t think individual Medicaid and Medicare patients, most of whom are on limited incomes, should be the ones who have to pay the balance of the bill. We could talk about cutting wealthy people off of Medicare and using that money to fund bigger payments to doctors. But making Medicare a means tested program opens up a whole other can of worms. You know wealthy people will balk at the idea of giving up Medicare even if they don’t need it.

  • NewMexicoRam

    What did you think about the medicare article i mentioned?

  • Patient Kit

    The problem is that what you see as a “simple solution” that would make it possible for you to make a living, many patients would see as something that would make it harder and sometimes impossible to see doctors. It’s not a simple problem and there is no simple solution.

  • Patient Kit

    Only for those who can afford to access that care.

    • J Oakman

      Yes, I want everyone to be able to afford the best care, and the only way to get there, as I see it, Is to pour our resources into individual HSA’s, tax free, instead of insurance premiums. Health insurance expires by law when you turn 65, then they turn you over to the gov’t which at most has been collecting $1000 a year to pay on average $300-400 thousand dollars per beneficiary. Meanwhile, insurance executives are living quite nicely in the Cayman Islands or Switzerland on the profits from all those premiums you and I paid or our employers paid. But strangely there’s no money left to pay the doctors who care for Medicare patients. It has to be borrowed from the Treasury Dept., laundered by the Fed, put into the general fund, squeezed by the bureaucrats for their living wage and benefit packages, tapped by the insurance benefit administrators, and then divided between drug coverage, labs, durable medical devices, X-rays, hospitals and finally the doctors get anything left to fight over amongst themselves. Research Ben Carson’s ideas on healthcare financing. He would make a great HHS head.

  • Patient Kit

    Yes, seeing the charges and policies in black and white would definitely help. I will do some searches to see if I can find a few samples of the kind of practice model you’re talking about to see whether I could afford to see a doctor that way on top of my insurance expenses. I really am interested in looking at all possible solutions. But as someone without a lot of money, I start from a very skeptical place on the direct pay and concierge models. But I will look for some specific concrete examples to see if we define “affordable” the same way.

  • Patient Kit

    I have no doubt that some doctors here don’t like and/or agree with me. And thats okay. What makes this forum special is that patients and doctors are talking to each other here and we’re having intelligent, difficult discussions about tough, complex issues. I believe that docs and patients do have a lot of common ground and are ultimately on the same side. But we do also have some conflicting priorities. The kind of communication and hard conversations that go on here at KMD are a necessary process if we are going to build any kind of coalition that includes both patients and docs. It may be frustrating sometimes but it’s much more productive than each in our segregated corner preaching to the choir.

    I don’t think your assessment above of what docs want is fair or complete. They may want shorter hours and more money, but they also want better relationships with their patients and the freedom to do what they think is in their patients’ best interest. If there was a simple easy solution to what ails our dysfunctional healthcare system, it would be solved already. I, for one, am nor giving up.

  • Dub

    You can set fees, etc., convert to concierge or membership and still collect from the guvmint and insurance companies.

  • Dr. Cap

    I love the subtitle.

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