How did Medicare become the highest paying carrier?
Editor’s Note: which features contributions from members of the medical community. These blogs are an opportunity for bloggers to engage with readers about a topic that is top of mind, whether it is practice management, experiences with patients, the industry, medicine in general, or healthcare reform. The series continues with this blog by Carol Gibbons, RN, BSN, NHA, who is CEO of CJ Consulting, which specializes in healthcare revenue cycle management. The views expressed in these blogs are those of their respective contributors and do not represent the views of or UBM Medica.
Recently, I was working on credentialing with a client who is starting a practice in South Texas. I was shocked when we started getting contract proposals from the carriers and most of the major carriers were all at 80% of the current Medicare rate. I have been very vocal about the rates carriers pay physicians and the resultant physician’s search for ancillary services to generate enough revenue to pay the bills.
Further reading: GOP Obamacare replacement bill puts physicians, patients in charge
A medical practice cannot survive on visit revenue alone without seeing an extraordinary number of patients every day. We see practices struggling financially that have high Medicare or Medicaid populations because of the complexity of their healthcare without appropriate reimbursement for managing these highly complex patients. The only way for practices to survive is to add equipment and/or staff to provide additional ancillary services, develop cash pay services in their practice or see so many patients that the provider has little time with the patient.
Without ancillary services, the physicians only have time to push more medications to solve health problems and little time to coach patients to lifestyle changes that could reduce the numbers of medications they are on. If they do add ancillary equipment to their practice, many times they over order studies to generate enough revenue to pay the increasing cost of running a practice.
As a consultant, I vet best ancillary services every month for practices. There are so many people knocking on their door to sell them the next piece of equipment or weight loss product, the overwhelmed providers are calling consultants to vet these services. There is a direct correlation to the move toward ancillary services and the dramatic reduction in reimbursement to physicians to actually take care of patients over the past 10 years. Certainly, this ancillary tsunami adds cost to our healthcare system and does not always provide an outcome that actually improves patient care.
In the news this week: Apple looking to expand healthcare presence
We should not stop the use of ancillary services. We only need to analyze the use of ancillary services to determine if this allows the provider to spend more time with each patient and improve their overall health status. If the service is just to generate income and the time with each patient does not show health improvements, then that just adds cost to our healthcare system. I have found the practices that are the most successful in changing patient behavior through ancillary services are those that teach the entire staff to be “health coaches.” Everyone has to be focused on improving health, not just medicating illnesses.
I also get angry when I look at the year-end financials of the major carriers in comparison to the fees they are paying new physician practices. If you pay attention to recommendations from investment advisors, Humana, Aetna, United Health Care, Cigna, etc., are recommended to investors because the company stocks are paying good dividends and have an increasing stock value. This is good for their investors but happens at the expense of their providers and to the detriment of their customers. It has not resulted in an improvement in population health that could drive down the overall cost of healthcare in our country.