Progressives hate corporations but love Obamacare. The irony of Obamacare is it pushes doctors into corporations, as it forces the private medical practice to disappear. Dr. Scott Gottleib writes in the Wall Street Journal:
Big government likes big providers. That's why ObamaCare is gradually making the local doctor-owned medical practice a relic. In the not too distant future, most physicians will be hourly wage earners, likely employed by a hospital chain.
Why? Because when doctors practice in small offices, it is hard for Washington to regulate what they do. There are too many of them, and the government is too remote. It is far easier for federal agencies to regulate physicians if they work for big hospitals. So ObamaCare shifts money to favor the delivery of outpatient care through hospital-owned networks.
The irony is that in the name of lowering costs, ObamaCare will almost certainly make the practice of medicine more expensive. It turns out that when doctors become salaried hospital employees, their overall productivity falls.
ObamaCare's main vehicle for ending the autonomous, private delivery of medicine is the hospital-owned "accountable care organization." The idea is to turn doctors into hospital employees and pay them flat rates that uncouple their income from how much care they deliver. (Ending the fee-for-service payment model is supposed to eliminate doctors' financial incentives to perform extraneous procedures.)The Obama administration also imposes new costs on physicians who remain independent—for example, mandating that all medical offices install expensive information-technology systems.
The result? It is estimated that by next year, about 50% of U.S. doctors will be working for a hospital or hospital-owned health system. A recent survey by the Medical Group Management Association shows a nearly 75% increase in the number of active doctors employed by hospitals or hospital systems since 2000, reflecting a trend that sharply accelerated around the time that ObamaCare was enacted. The biggest shifts are in specialties such as cardiology and oncology.
Estimates by hospitals that acquire medical practices and institutions that track these trends such as the Medical Group Management Association show that physician productivity falls under these arrangements, sometimes by more than 25% (more on this below). The lost productivity isn't just a measure of the fewer back surgeries or cardiac catheterizations performed once physicians are no longer paid per procedure, as ObamaCare envisions. Rather, the lost productivity is a consequence of the more fragmented, less accountable care that results from these schemes.
Once they work for hospitals, physicians change their behavior in two principal ways. Often they see fewer patients and perform fewer timely procedures. Continuity of care also declines, since a physician's responsibilities end when his shift is over. This means reduced incentives for doctors to cover weekend calls, see patients in the ER, squeeze in an office visit, or take phone calls rather than turfing them to nurses. It also means physicians no longer take the time to give detailed sign-offs as they pass care of patients to other doctors who cover for them on nights, weekends and days off.
Most hospitals exacerbate these strains by measuring the productivity of the physician practices they purchase in "Relative Value Units." This is a formula that Medicare already uses to set doctor-payment rates. RVUs are supposed to measure how much time and physical effort a doctor requires to perform different clinical endeavors.
Medicare assigns each clinical procedure a different RVU and then multiplies this figure by a fixed amount of money to arrive at how much it will pay a doctor for a given task. A routine office visit has an RVU of about 1.68, while removing earwax has one of 1.26. Setting a finger fracture rates a 3.48.
This system misses all of the intangible factors that help gauge the quality and efficiency of the care being delivered. It focuses physicians on the wrong goals for promoting health, such as how well they code charts to capture higher-value "units."
Hospitals are beholden to the RVU system only because that is how they get paid by the government. Data from the Medical Group Management Association shows that physician productivity in these employed relationships, measured simply by RVUs, declines up to 25% compared with independent practices. The Advisory Board ABCO +0.32% Company, a health-care consulting firm, estimates that when hospitals last went on a physician-acquisition binge in the late 1990s, productivity fell by as much as 35%. Those arrangements mostly failed, and the hospitals divested the stakes they had in individual doctor practices. The physicians went back to practicing out of their own offices.
All of this reduced productivity translates into the loss of what should be a critical factor in the effort to offer more health care while containing costs. Yet hospitals aren't buying doctors' practices because they want to reform the delivery of medical care. They are making these purchases to gain local market share and develop monopolies. They are also exploiting an arbitrage opportunity presented by Medicare's billing schemes, which pay more for many services when they are delivered at a hospital instead of an outpatient doctor's office.
This billing structure exists because hospitals are politically favored in Washington. Their mostly unionized workforces give them political power, as does their status as big employers in congressional districts.
ObamaCare pushes this folly largely based on a naive assumption that models that worked well in one community can be made to work everywhere. President Obama has touted "staff models" like the Geisinger Health System in Pennsylvania and the Mayo Clinic in Minnesota that employ doctors and then succeed in reducing costs by closely managing what they do. When integrated delivery networks succeed, they are rarely led by a hospital. ObamaCare seeks to replicate these institutions nationwide, even though their successes had more to do with local traditions and superior management. That's hard to engineer through legislation.
Dr. Gottlieb is a physician and resident fellow at the American Enterprise Institute.
Sunday, March 31, 2013
More Obamacare changes coming to medicine
Subscribe to:
Post Comments (Atom)
31 comments:
Uh...it's pretty hard to blame the increase in doctors working for hospitals on Obamacare.
Didn't anyone around here noticed that the increase in Baptist Hospital and UMC satellite offices began long BEFORE Obamacare?
Also in play were the creation of " boutique" practices like " sports medicine".
When the medical profession began to use business models to increase profit in the mid 80s, the growth of large corporations with whom " mom or pop" single practices could not compete was inevitable.
These large medical corporations can take advantage of economies of scale not available to a single practice physician.
Really? When was Obamacare signed into law?
The goal of hospital owned clinics isn't the delivery of good quality healthcare, it is about the referrals to the hospital. Self proclaimed best ever doctors that don't actually treat patients, but instead act as referralists, are the most rewarded. They will get you an endocrinologist for your diabetes, ortho for your sprain, neurologist for your headache, and neurosurgeon with an MRI for your back pain. It is all about the referrals.
I've noticed a whole lot of store-front clinics have sprung up in Madison and on the parkway in Ridgeland. Seems there are about fifteen new 'drop-in' clinics. I'm guessing that's because people are damned tired of sitting in a waiting room for hours, even after having an appointment. People can't go to 'Baptist Hospital or UMC', 7:03, to see a doctor. Well, not unless they're indigent or illegal. What do you suggest?
Don't you suppose this is the same reason the auto dealerships on extreme South State Street disappeared? Customers, including those of us needing to see a doctor, EXPECT vendors, even those wearing white coats, to come to US now.
I remember Pelosi, during the runup to Obamacare, promising that 'even those of you who want to quit your jobs and go into something like art or photography can do that without fear of having no health care'. Those types and progressives don't give a hoot in hell about the destruction of medical practices. And they're becoming the voting majority.
As to your 'Sports Medicine-Boutique' comment, those people are meeting a critical need that would not and could not otherwise be met.
April 1, 2013 at 7:25 AM
I disagree. Wasted money goes to non-docs (PA's NP's) and primary trying to manage things a specialist can diagnose and treat quickly and effectively. Believe me the specialists are happy to see the patient, diagnose the problem, fix it or set the patient into to maintenance mode for the Primary doc to help manage.
Medicaid bill at the legislature went down Easter Sunday....the Hospital Association was the main driver in the defeat because they want Obamacare here....all democrats voted against...special session loomimg. So if you know someone that works for the Hospital Assc. feel free to tell those communist what you think.
Reasonable progressives don't "hate corporations" (yes, there's idiots everywhere), they usually just want the law to treat corporations equal to or at least not more favorably than non-fictional people.
Guess you missed the part where Obamacare abolishes new physician owned hospitals and won't allow current ones to expand.
7:31 ..ever heard of University Physicians? My primary care doctor is a University Physician at Grants Ferry and I receive specialist care from another University Physician. Appointment only, prompt service. I have full insurance coverage and I pay for service and could choose to go anywhere. University Physicians are private physicians working under the UMC tent. Baptist also has a string of private pay clinics.
Reasonable progressives ...
THERE is an oxymoron.
8:48. Yes, those are the same facilities I choose to use rather than 'going to a hospital to see a doctor'. I've used both St. D and Baptist clinics in Madison for a number of years now. And I'm sure 'University Physicians' on Grants Ferry is identical in concept to those two.
I still can't understand how doctors in all these drop-ins can make a good living. If I'm not mistaken, on 51 in Madison there's a paint store, an ear/nose/throat clinic and some sort of cardiac facility all in a row. Almost one stop shopping.
I for one will never again in my life show up at the MEA empire and wait my turn. Although they're owned now by St. D., they're no longer the only game in town, thank God (or whomever).
Speaking of drop-ins and boutique clinics, I was surprised a couple of years ago to find out my doctor had quit the practice at Baptist and opened a botox/weight loss/feel good clinic. They'll all eventually figure out a way to get around Obamacare or they'll open bait shops.
Assuming this plays out as the article suggests, we will have a physicians' union in about five years. And healthcare will become a zoo.
"Liberalism (Progressiveism) is a mental disorder." What I once thought was a tongue-in-cheek title for a book, I now have come to KNOW that phrase as an absolute truth! My personal observation is: In order to be liberal, you have to have the ability - and willingness to suspend / disregard the truth. You have to be able to look at the sky and claim that it is a color other than blue.
Liberalism will certainly be the ruination of this country. From political correctness (wouldn't Josef Stalin be PROUD) to socialization of our medical system, etc., I believe that to be true with every fiber of my body!
And why liberals believe they will be immune to the problems caused by their insane policies is beyond anything I can understand........
Regarding University Physicians and UMMC, neither are in-network with the plan my huge employer offers through CIGNA, one of the largest insurance companies in the U.S. Every single physician, clinic or hospital my family and I have used are in-network with CIGNA. However, if I'm indigent, not a U.S. citizen or on Medicaid I'd be welcomed with open arms. So all the wonderful ads that they run in the Clarion Ledger along with the glowing articles about new procedures are of no use to us. It's especially painful that my state income tax dollars go to fund the very institution that I can't use. It's really a darn shame too since University Physicians has some really great docs.
3:46; blame it on the overpaid, big-headed clinic managers and big-time-accounting staff who are too damned lazy to 'manage' the writeoff required to be in-network. The doctors at these places don't make those decisions.
3:22, by overwhelming majority, most scientists are of what political orientation? No brains at all.
Go back to your 6,000 year old earth.
Peace.
The business model was being adopted in medicine in 1985. That's the earliest I knew first hand about it around here, but not the first adoption elsewhere.
Medicine used to be a profession, not a business. It used to be about healing.
If a system is about profit rather than delivery of services, a business model works.
And, yes, KF, the medical and pharmaceutical industries are driving the politics. We'd have long ago contracted for medicine in bulk were that not the case.
4:49 why don't we be honest about this? They don't WANT to be in the network because they don't want to accept the ridiculously low payment for services offered by the PPO health insurer. I elect to pay a higher premium for a "major medical" plan instead of a "PPO" plan because (a) I want to be the one deciding which doctor I will see and (b) because I believe my doctors of choice deserve the fee they charge. I will soon become one of the millions Obama lied to when he said I could what I have. I will NOT be able to keep what I have because what I have will no longer exist once Obama care kicks in...as this article explains.
CIGNA is the only major group UMMC can't reach an agreement with; they insist on payment schedules that would result in losing money on basically every patient, and that would not allow for the long-term survival of UMMC or University Physicians. The premiums may be low for employers, but I've heard they are like this in every market.
University Physicians are not paid by your state taxes; the faculty practice plan is supposed to be self-supporting, and pays UMMC for overhead (the "Dean's tax", as it was known). The hospital, of course, is partially supported by the state. And your taxes do support a small fraction of Medicaid, but would support the same fraction wherever the patient chose to get his/her care.
The inevitable long-term outcome of all the pressures in Obamacare is for 1) private insurers to go bankrupt; 2) physicians to be forced to abandon private practices to join groups or "accountable care organizations"; 3) once single-payer replaces the individual insurers, then government will dictate ever-decreasing prices, otherwise they could never afford to pay for care for an ever-enlarging group of patients.
PS to a poster above - in almost all cases, it is illegal for doctors to unionize - it is an anti-trust violation. This has led to some bizarre situations. A few years ago Blue Cross lowered theit payment for colonoscopies so low in Minnesota that all but one gastroebterologist in the state refused to perform the procedure for anyone covered by BLue Cross. I forget how many GI specialists there were, but they denied collusion, and said (to pick a number out of the air) that all 179 of them individually came to the independent conclusion that they couldn't afford to perform colonoscopies for that rate. Blue Cross, after hearing from their members, eventuall raised their reimbursement.
It's an all-around ugly mess, and it's going to get worse.
Cigna does not have a network, they rent from Aenta
UMMC can't afford to provide services at the price CIGNA dictates but they can afford to provide services at the price medicare and medicaid dictate?
A good first step to dealing with our medical crisis is to discover what actual costs are!
A tiny paper pill cup is not $12! Neither patient nor their insurance company should have to buy a hospital gown as if it were new until it rots.
And, insurance companies shouldn't get to whine about patient costs without being forthcoming about their actual expenses versus profits on each policy holder over a life time rather than in a fiscal year.
We know there's a 400% mark up in retail. How much mark up is there in medicine? Do we even know?
And, when it comes to health, are we sure it should be a for profit business or is it so essential to a society that a fair compensation for services rendered is a better choice. Isn't health more like education than like widgets?
Does the business model (where CEOs get outlandish compensation these days) really work in health care ?
When our economy worked, a 20% profit was considered good. Consumer " good will" was included as an asset.
Now ,we worship money so much that we can't tell the difference between earning money and conning people out of it!
I Failed Math said...
UMMC gets a higher rate from Medicaid than other providers and Medicare most likely pays more than Cigna and does not deny services and refuse to pay after 90 days for services rendered.
6:27 I am not sure what "retail" you are talking about but as a retired (this year) retail business/merchandising analyst in just about all of retail you are wrong, way wrong!
My doctor story, move here from a few years in Durham,NC had a great doc there. One day went to see him and he tells me he is leaving. The reason, Duke owned the clinic and had decided he was spending to much time with each of his patients. So he left and one of the bests docs I ever had just vanished.
It would take an absolute fool to suggest medicare pays more than a major national carrier, after it's disallowance. And there ought to be MORE refusals to pay to those places that fraudulently pad their services, double charge and 'forget' which services were actually provides as opposed to 'allowed by physician'.
One would have to be a recovering idiot to suggest that medicare pays a higher dollar amount for a procedure than a nationwide group carrier. And if medicare doesn't deny services, it should.
Should have specified clothing...most other retail mark-ups are figured so when it's 50% off, the retailer will still make a profit and break even at 75% off.
And, yep 12:57 pm...assembly line medicine.
Medicine is the economy in the US. The insurance companies' golden egg is medical information. Hospitals are learning to utilize IT as are the physicians. The healthcare insurance companies are the envy of the federal government due to their statistical prowess. Obamacare puts the providers back in the drivers seat. European medicine is much more IT savvy...utilizing the info to forecast, target populations, and generally improve public health. They have organized research, scientific reporting, and care in a more rational manner. The EU insurance industry focuses on other lines of risk.
Software can 'do' the decision-making for most jobs. Decision tree software is probably being cooked up in some graduate student's basement in Boston. Medicine is an area where automation is just waiting to pounce. It will wring out the many inefficiencies, errors, drama, and bloodletting of the horse and buggy medicine we are accustomed to.
I've never been 'referred' to a specialist by my 'doc in the box' except upon request such as for procto or gall bladder test. MEA is famous for these referrals though. My company quit using them years ago for Workers' Comp since they sent every damned employee/patient down the road for tests, etc.
The Insurance companies have the motherlode of health information. Doctors and hospitals have yet to discover the relational database. In short, they cannot see the forest for the trees. Public health specialists, drug companies, and medical device manufacturers know healthcare very well. With Obamacare the states and the general government begin to play an adult role. Hospitals and doctors get computer savvy after years of being beaten up by the insurers and not improving the overall health.
Post a Comment