travelbug73 said:
Something I really do not understand is how doctor's get paid, essentially, how the insurance companies and physicians' salaries/services provided by doctor's work. I think this information will help to-be-doctors a lot because none of this is covered in med school or residency.
I spent four months working in my dad's FP office, and I can answer this one for community FP anyway. The answer is complex.
1. Some patients, even now, pay cash for services, but they are the minority. The doctor is free to charge what he wishes if the patient will pay it.
2. Many patients belong to HMOs that capitate. What this means is that the HMO pays the doctor a fixed amount of money for each member whom it assigns to that doctor, regardless of how often the patient utilizes services. So if you are a patient on one of these kinds of HMOs, the doctor gets paid a set amount of money for you every month, regardless of whether you go to his office ten times, once, or not at all that month.
3. Some patients are on HMOs or PPOs that pay based on the visit and the services rendered. The doctor's office must send a claim form with the proper codes to get authorization for payment from the insurance company. So if you go to the doctor for a cold, he gets paid based on how long your office visit was (with like five different levels of involvement). If he performs services that do not have codes (or if he screws up the coding for authorized services!), he won't get paid. Many HMOs also charge patients a co-payment of $5-$20 per office visit (which goes to the doctor) to keep unnecessary office visits down. The doctor's office is responsible for collecting the co-payments from the patients.
4. Some HMOs offer risk contracts. They give the doctor a pool of money at the beginning of the year, and any expensive care required by his patients is paid for from that pool. If there is money left over at the end of the year, the doctor gets to keep it. If the costs of care go over the amount in the pool, the doctor must pay the difference out of his own pocket. So naturally, this gives the doctor a huge incentive to provide the least possible care, and my father refuses to take any risk contracts for exactly this reason.
5. Many elderly patients have Medicare (paid for by the gov), as well as some kind of private insurance that is geared toward elderly people. The gov. sets the rate of compensation, and if it won't cover a service, then the doctor can try to get payment from the private insurer.
6. Indigent patients have Medicaid, also paid for by the gov. Again, the gov. sets the rates. Medicaid reimbursement rates tend to be very low, so most doctors cannot have a huge proportion of their patients be on Medicaid, or they will not be able to afford to stay in business.
7. Worker's compensation pays for medical services for patients who have been injured on the job. This is paid for by the patient's employer. My dad sees injured employees from one of the grocery store chains here in FL.
As you can probably guess, dealing with HMOs, each of which has its own rules and codes, requires a huge amount of paperwork. My dad's office has several staff members who are dedicated to coding, negotiating contracts with about a dozen different HMOs, verifying patients' insurance information (because sometimes it changes from visit to visit or even month to month, and if you don't know that the patient has a new insurance company, you won't get paid), billing patients who owe money for copayments or private payments, re-submitting denied claims, etc.
Trust me, PC is not my friend's strong suit.
