Doctors may be forced to accept Medicare rates to stay licensed


Massachusetts has a problem.

In April 2007, they became the first state to require residents to have health insurance. Reportedly this has resulted in 300,000 newly insured patients and lowered the uninsured population to 5%. But of course, given the relatively poor reimbursement rates for primary care providers, especially when it comes to government insurance, the state is facing a growing shortage of primary care providers.

Without an adequate supply of primary care physicians, however, the plan cannot guarantee timely access to care, creating a gap between coverage and actual provision of services. As a result, waiting times to see a primary care physician can amount to weeks and even months in some instances.

It’s ironic since the health care reform bill in Massachusetts was supposed to stress the importance of preventative care but because of the relative shortage of doctors to deliver preventative care, many patients are seeking primary care from specialists. Unfortunately, specialists also specialize in expensive care. Thus, health reform in Massachusetts has resulted in decreased access to primary care and higher costs.

This is what happens when you call an expansion of government health care spending, health care “reform” instead of legislation that actually reforms a broken system. This may be a bad harbinger of what is to come for the rest of the nation.

What can Massachusetts do to actually reform their primary care system? Well, they can improve primary care reimbursement or revamp the reimbursement system to reward overall care and good outcomes rather then only rewarding physicians for visits (quantity over quality) or medical school debt repayment. But why pay doctors more for better care when you can just force them to accept lower reimbursement rates (as low as 110% of Medicare rates) “as a condition of their licensure” that would effectively make these physicians employees of the state?

[Senate bill 2170 and house bill 4452] would require physicians and all other health care providers to accept 110% of Medicare rates for health insurance for small businesses. For physicians, acceptance of set rates would be as a condition of licensure! Moreover, physicians would have to accept all such patients – and such rates – if they participate in any other plan offered by that insurer.

The stated purpose of such a misguided bill is to try to decrease health care costs for small businesses but all it does is show how little the sponsors of these bills understand medical economics. These bills make no distinction between primary care providers who are in the best position to decrease costs and specialists who tend to increase costs. Both are penalized equally. Nor do these bills require private insurers to pass on savings to employers. The end result is likely to be a net loss of physicians to nearby states and many who join the increasing ranks of physicians who have cash only practices.

Even from a practical standpoint, these bills are confusing. What does “as a condition of their licensure” mean? Does this apply only to new applicants or to re-applicants? Are physicians who refuse to accept lower rates going to be stripped of their licenses? What about physicians who are employees of private health clinics who do not have control over the rates that are accepted? Will they be forced to quit or risk losing their licenses? Aren’t people in the Northeast supposed to be generally smarter or does that not apply to their state legislators? Is this the beginning of the nationalization of health care in this country? Is this a good time to get out of the profession of medical care?

Chris Rangel is an internal medicine physician who blogs at

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