It is my understanding that a 27% cut to reimbursements acros the board is going in to effect next week unless some action stops it. I know this has been going on for years but the threat seems more real this time. How are you going to address this change and are there ways to create more revenue within the confines of the current guidelines?
Impending Medicare Cut
- Thread starter 4ophtho
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Anyone considering going cash only? Strip down overheads, barebones billing, only do EMR if it increases profitability, deliver high-quality care with less stress about Medicare/insurance reimbursement?
The problem with that is that the other 10 ophthalmologists on your block will take a patient's crappy insurance. In other words, no patients will want to go to you unless you offer something really special that no one else can do (i.e. unlikely). For that to work, ophthalmologists need to band together (also unlikely).
If you have 50% overhead, a 27% cut to reimbursements means a 54% cut to income. Seems like it would be impossible to make up for that and if it were to stay that way you'd probably get paid more by switching to that job you could have gotten straight out of college.
Not to mention that the job market across all fields of medicine that rely heavily on medicare would drop to zero. Many employed physicians will probably be laid off because they couldn't collect more than they're being paid.
Not to mention that the job market across all fields of medicine that rely heavily on medicare would drop to zero. Many employed physicians will probably be laid off because they couldn't collect more than they're being paid.
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50% overhead is pretty low. Most private comprehensive practices are a bit higher than that. Retina can get that low or lower. The biggest problem will be in academics, where the overhead for departments is much higher 70-100+%. Many other specialties have higher average overhead % and will be hit even harder.
Agreed.
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this would be no different under romney...let his name never be mentioned again
It is amazing how complex of a system delivery of healthcare and reimbursement of services has become. There are just so many layers stuffed between the doctor and patient -- just baffling. I wonder what doctors from the early 20th century would think of our current healthcare bureaucracy.
Not true.
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The Sustainable Growth Rate cuts ("SGR"), wherefrom the 27% across-the-board scheduled Medicare cut is coming was in play before Romney's candidacy and even Obama's first inauguration. It has been a feature of the existing Medicare legislation that has been postponed serially and nearly annually (in some years delayed more than once by continuing resolutions) all the while rolling up ever larger percentage of cuts in order to adjust downward the aggregate spending under the Medicare program to match the rate of inflation. It was a flawed idea from the outset, completely ignoring the demographic balloon in Medicare-eligible Americans and the progressive increase in the quantity and variety of medical services for which coverage by Medicare is authorized, and the generally rising longevity of Americans from the inception of Medicare in 1965 (Part A) and 1967 (Part B.)
A 27% cut is not a survivable condition for the physician services market with the other features that have applied to Medicare reimbursement since at least 1986. In that year, Congress authorized Medicare to set maximum allowable charges for services provided under the Medicare program and made participation conditional on capping the rates for services, irrespective of actual costs to the providers. Formulas were devised to quantify the amount of resources required for a particular service (time, education, risk) and fudge-factor "multipliers" were factored against those aggregate resource numbers to calculate the Medicare allowable rate. Supply and demand had nothing to do with it; the entire scheme is straight from the central planning committee playbook. The problem is that the calculations and the multipliers are made-up numbers and are tweaked for political and budgetary reasons and have resulted in allowables that have increasingly departed from fair market prices and actual costs of operations of medical practice. If you ever wanted to know why finding someone to stent your LAD was so easy but getting someone to adjust your diabetes and hypertension medications was so hard, the answer is right there.
If the SGR is not reversed, the only primary care practices that will be participating in Medicare anymore will be those at Federally-Qualified Health Clinics, the euphemism for the patchwork of government-subsidized clinics that had to be subsidized independently in order to have services available under the Medicaid program because the payments were so low and so unreliably made that Medicaid beneficiaries couldn't access care anywhere. This is where a lot of Medicare beneficiaries will find themselves going, to a government clinic. Soon to follow will be specialists whose payments have been whittled down to the margins of sustainability, particularly those that derive most of their revenues from E/M services or from procedures that are not well or adequately reimbursed (general surgery increasingly.)
The only condition that has any hope of allowing the survival of Medicare as we know it under the condition of the SGR cut is the simultaneous lifting of the cap on balance billing. That should be done as an emergency legislative measure and as soon as possible.
A 27% cut is not a survivable condition for the physician services market with the other features that have applied to Medicare reimbursement since at least 1986. In that year, Congress authorized Medicare to set maximum allowable charges for services provided under the Medicare program and made participation conditional on capping the rates for services, irrespective of actual costs to the providers. Formulas were devised to quantify the amount of resources required for a particular service (time, education, risk) and fudge-factor "multipliers" were factored against those aggregate resource numbers to calculate the Medicare allowable rate. Supply and demand had nothing to do with it; the entire scheme is straight from the central planning committee playbook. The problem is that the calculations and the multipliers are made-up numbers and are tweaked for political and budgetary reasons and have resulted in allowables that have increasingly departed from fair market prices and actual costs of operations of medical practice. If you ever wanted to know why finding someone to stent your LAD was so easy but getting someone to adjust your diabetes and hypertension medications was so hard, the answer is right there.
If the SGR is not reversed, the only primary care practices that will be participating in Medicare anymore will be those at Federally-Qualified Health Clinics, the euphemism for the patchwork of government-subsidized clinics that had to be subsidized independently in order to have services available under the Medicaid program because the payments were so low and so unreliably made that Medicaid beneficiaries couldn't access care anywhere. This is where a lot of Medicare beneficiaries will find themselves going, to a government clinic. Soon to follow will be specialists whose payments have been whittled down to the margins of sustainability, particularly those that derive most of their revenues from E/M services or from procedures that are not well or adequately reimbursed (general surgery increasingly.)
The only condition that has any hope of allowing the survival of Medicare as we know it under the condition of the SGR cut is the simultaneous lifting of the cap on balance billing. That should be done as an emergency legislative measure and as soon as possible.
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Unfortunately, none of.this solves the fact that Medicare as we know it is one big pyramid scheme. Woe to politician who eventually has to tell the American people that. Nobody wants to learn they're at the bottom of.the pyramid.
Actually...lifting the cap might not be a bad idea. It forces people to put some skin into the game so to speak.
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What about making up for lost income for things that insurance won't pay for, like charging more for a refraction, or practicing in a building where you are a partial owner and can charge a "facility fee" for an office visit like you would at an ASC? Any other ways besides relying on increasing volume or doing an OCT etc more frequently where you can make up for lost income? I'm not saying that we need to all have a vacation home and drive a luxury car, but we residents and beginning doctors all have hundreds of thousands of dollars in student loans and have been delaying major life milestones like starting a family, saving for a home, etc while working quite hard in the meantime with little to show for it in terms of financial success.
For instance, my kids' pediatrician charges every patient $12/year for "administrative costs/paperwork/etc". I figure this adds several tens of thousands of dollars in a busy primary care practice with a patient base of several thousand. Can we as subspecialists use similar strategies to help ease the burden of lower reimbursements and increased administrative costs?
I'm sure you can try charging these random cash surcharges. But guess what: patients are not going to want to pay them because they are accustomed to their insurances basically paying for everything. You should see my patients' faces when I tell them they owe me $35 extra out-of-pocket for a refraction. Patients believe that EVERYTHING is paid for by their almighty insurance. I've even had some patients demand that their desired Gucchi frames be entirely covered by their insurance.
Like someone mentioned before, strategies like this will only work if EVERY doc in the community is doing the same thing. Otherwise, these strategies will likely piss patients off enough for them to seek your "competitor" across the hallway. Again, we are weak because we are all divided and pitted against each other to fight for the scraps off of the insurance companies' (and governments') tables.
Like someone mentioned before, strategies like this will only work if EVERY doc in the community is doing the same thing. Otherwise, these strategies will likely piss patients off enough for them to seek your "competitor" across the hallway. Again, we are weak because we are all divided and pitted against each other to fight for the scraps off of the insurance companies' (and governments') tables.
What about doctors n the same area or tied to the same hospital coming together to standardize their fees such as these? I know private doctors can't "unionize" but is it illegal for doctors all affiliated with the same hospital to meet and discuss implementing a standard clinic surcharge or other fee schedule?
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If you are simply affiliated with the hospital and not employed by the hospital you can't do that because you and the other doctors would still be considered competitors under labor and anti-trust laws.
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I've had this experience too, as we all have had but let me make a suggestion....
If you are going to charge patients out of pocket for things (anything, really) you really need to do a few things to pull it off...
1) You need to let them know well in advance. People don't generally freak out if they get bad news. They freak out if they get unexpected news.
2) 90% of it is in the delivery and this means that either you or the staff member has to be very well trained in making the delivery. Far too many doctors offices have staffs that are overworked and bitchy. I completely understand why but giving off "attitude" won't get you where you want to go. We all have this idea in our heads that patients should just damn well be grateful that they are seeing as and being able to partake of our tremendous knowledge and skill but it simply doesn't work that way in eyecare.
A story...
My mom wanted a new frying pan for Christmas. Worst gift ever but that's what she wanted. So in the town where my office is there is a large restaurant supply house that has every kitchen gadget and appliance you can imagine. It's really a pretty cool place.
So around the first of December I go in there to try to buy her a Swiss Diamond frying pan which is a high end non stick pan. But in that section of the store, they had very little left. So I tracked down a sales lady (who already had a puss on) and asked if they had any more in the back.
"No. Whatever is out there is all we have."
"Do you anticipate getting in some more soon?"
"Maybe sometime in the next month or so."
"Ummmm....well....there's something kind of happening in the next month."
"I'm aware of that. If you want, you can call back in a few weeks and see if we have any."
"Ummmm.....ok.......thanks for your help."
So I walked out and ordered it online.
Now.....she handled just about the worst possible way she could have. She was essentially the most unhelpful sales woman in history. Here's a couple of better ways that would have worked....
"Oh no....we don't have any more..I'm really sorry. Those are backordered. I can't guarantee we will have any more in time for Christmas."
(Even if they are NOT backordered, LIE to me for Christ's sake.)
-OR-
Even better......
"Oh no....we don't have any more....I'm really sorry. Those are backordered. I can't guarantee you that we will have any more in time for Christmas. But if you want a really nice frying pan, let me show the All-Clad or the Emeril line. They are just as nice and we have those in stock."
If she went with the second method, I would have bought the pan.
If she went with the first method, I wouldn't have bought the pan but I would have at least left satisfied that the woman understood that it was supposed to be a present and felt badly she couldn't help me. (even if she didn't feel badly)
But what I got was essetially "sorry. can't help you. bye."
I doubt I'll ever darken their door again.
Regarding refration charges.....which is better....
"Sorry. Medicare doesn't cover it. It's $35.00"
-OR-
"Mrs. Jones....I know it's crazy but unfortunately medicare doesn't cover this one particular portion of the eye exam. I'm really sorry about that but if you want us to give you a prescription for eyeglasses it's $35.00."
Which would you rather hear?
Also, if you're going to charge people out of pocket for things other than a refraction you have to make sure you deliver a higher level of service or you do it in a well appointed office or something like that. Charging more "just because" rarely works.
Honestly, I wouldn't worry about this too much. They will provide a temporary fix again soon. The fact that this is not something many or even most physicians and hospitals could possibly sustain helps. Most of us are already near the limit of how many patients we can see per day and it's just not feasible to keep seeing more and keep lowering overhead (ancillary support) at the same time without making mistakes.
The government's plan is to slowly make things worse for us and see how much we can take, like we're frogs in a pot of boiling water.. they don't want to let sh__ hit the fan, have the whole healthcare system fall apart right after they passed Obamacare, and have the voter's anger turned against them.
The government's plan is to slowly make things worse for us and see how much we can take, like we're frogs in a pot of boiling water.. they don't want to let sh__ hit the fan, have the whole healthcare system fall apart right after they passed Obamacare, and have the voter's anger turned against them.
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Collusion is illegal. You would have to join together as a single practice entity, then you can fix prices all you want. Except Medicare and insurance companies have already done that.
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This is the only glimmer of hope, IMO. Letting this cut go through would be armageddon for the entire healthcare system. I just can't see them letting it happen.
I personally suspect the govt keeps SGR around to keep doctors in their place. Every year they can threaten us with a 27% cut, save us from it, and then give us a seemingly-small-in-comparison 2% cut instead.
Politicians won't let a 27% cut stay for very long because they'll get blamed for it. Politicians, along with everyone else -- hospital administrators, lawyers, insurance and pharmaceutical CEOs, the growing obese American public, etc -- want the full responsibility of healthcare to remain squarely on the shoulders of physicians; they will try to change the system indirectly by putting pressure on physicians from every direction but they would never do anything that might shift the responsibility and the blame to themselves.
Politicians won't let a 27% cut stay for very long because they'll get blamed for it. Politicians, along with everyone else -- hospital administrators, lawyers, insurance and pharmaceutical CEOs, the growing obese American public, etc -- want the full responsibility of healthcare to remain squarely on the shoulders of physicians; they will try to change the system indirectly by putting pressure on physicians from every direction but they would never do anything that might shift the responsibility and the blame to themselves.
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The Congress keeps SGR around because they just don't have any other better ideas to control costs that don't expose nakedly the fact that the government cannot possibly devise a plan to pay for the services they have promised in exchange for votes, mainly from seniors, who feel they have paid in advance for their benefits but whose consumption greatly exceeds in value all contributions, on a lifetime basis. SGR is increasingly like nuclear weapons, nice to see up on the mantel but no one ever wants to take it down.
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