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A Call For Physicians To Contribute To Solutions, Not Costs



July 29th, 2011

 It’s time for America’s physicians, particularly its highly paid procedural specialists, to make a choice.  Are we primarily businessmen with a keen eye on the financial bottom line, or are we above all professionals, well versed in the healing arts and dedicated to our patients’ care, regardless of their circumstances? 

America’s medical system is breaking apart:  the high cost of health care, of which we are a part, has fractured state Medicaid budgets and threatens our Medicare program. Patient care is suffering across this great and wealthy land.  Will our principal role in the health care crisis be as contributors to rising costs, or can we contribute to a desperately needed solution?

Last year, Arizona made headlines with its decision to defund several organ transplants from its Medicaid program.  This was a death sentence for individuals with certain blood cancers and forms of heart and lung disease.  Now, Arizona has asked the federal government for permission to remove 280,000 people from its program.  New Jersey’s Governor Christie has proposed denying new Medicaid coverage to adults in families of three whose household income is more than $5,300 a year, down from the current cutoff of $24,645.

Looking From The Vantage Points Of Both Physician And Patient

For me, the harms of the Arizona and New Jersey situations resonate deeply.  As a physician, I’ve seen firsthand the damage that can result when patients do not receive the care they need due to a lack of medical insurance. I am also a cancer survivor.  I desperately needed a bone marrow transplant to save my life from non-Hodgkin’s lymphoma.  If I had been an Arizona Medicaid patient, I would have been ineligible for such a procedure, and I would now be dead. 

For the first year after my transplant, because of my inability to work, our family income fell below New Jersey’s current limit of $24,645  but remained above the proposed new limit.  As a New Jersey Medicaid patient, I, therefore, would have been ineligible for insurance just when I needed it most.  Individuals living in families with total earnings below $25,000 simply can not afford to pay the hundreds of thousands of dollars for the health care that I needed to survive my transplant.  Unfortunately, my situation is hardly unique; from the cost of care for chronic diseases to the costs of treating injuries from car accidents, Americans’ medical expenses often reach far beyond any possibility of payment without the help of insurance. 

Nor are the cuts limited to just these two states.  Twenty states reduced their Medicaid benefits in one form or another in the year 2010 with 13 more states following suit this year.  In all, 40 have reduced their pharmacy benefits since 2010.

However, try as I might, I cannot be angry with the leaders of these states.  Medicaid expenses are consuming up to 38 percent of their states’ general funds, with Medicaid often their fastest growing budgetary item.  Furthermore, with the loss of the temporarily increased Federal Medical Assistance Percentage on June 30 of this year, the states’ share of Medicaid spending will increase 25 percent or more.  The states and, indeed, the federal government need help meeting their health care responsibilities.

While the fiscal crisis affecting Medicare is not as acute, it is no less dire.  Payments to providers are projected to exceed revenues to Medicare’s Hospital Insurance Trust Fund in just 9 years, and Medicare’s actuaries project the exhaustion of this fund by 2029.  As a consequence of these fiscal realities, many reform efforts continue in Washington to reshape Medicare’s future.  For example, the Republican led House of Representatives has passed Rep. Paul Ryan’s voucher plan for Medicare.  It changes Medicare to a defined contribution entitlement and shifts costs onto the elderly.  Not only would America’s seniors be required to pay considerably more for insurance — the  Congressional Budget Office estimates that by 2030 new enrollees would incur nearly triple the out of pocket expenses to buy coverage comparable to traditional Medicare — these vouchers, by design, will not keep pace with the historical health care inflation rate. 

The GOP voucher plan would most likely leave our senior citizens to pick and choose which health care concerns they can afford to address during any calendar year, obviously lowering the quality of care for those with chronic or serious medical conditions.  The elderly, in a voucher system, would need to ration their own healthcare spending, choosing which ailments bother them the most at any one moment while likely delaying comprehensive care for underlying diseases such as heart disease or diabetes.  No longer could physicians generally assume that the money was available for the care that they were discussing with elderly patients.  Even if such a voucher plan never becomes law, these are historical times for Medicare; the political will is slowly being mobilized to make large scale alterations to this program, and it is certain that significant changes lie ahead that will deeply affect the quality of care for our patients.

Physicians Have The Opportunity And The Obligation To Lead

Physicians are in the enviable position of being able to offer needed leadership to help guide our state and federal governments through this time of transition.  Both the states and federal government need better systems to deal with their healthcare obligations while preserving all that is best with American medicine: access to cutting edge care, the sanctity of the doctor-patient bond, and the ability to care for all Americans using Medicare and an expanded Medicaid program.  Physicians, with our daily immersion in our medical system, knowledge of effective treatments, and understanding of patient behavior are among the best resource available for improving both Medicare and Medicaid for the good of our patients.

Specialty physicians are also in the position of being able to make some financial sacrifices to improve the solvency of the system and give our state and federal governments a measure of needed relief from their health care liabilities.   In my own specialty of orthopedic surgery, when surveyed in 2010, we enjoyed an average income of nearly $515,000; other procedural specialists’ incomes range nearby.  Many specialists also enjoy lucrative partnerships in imaging or surgery centers, pain clinics, or physical therapy centers that add hundreds of thousands of dollars per year to our incomes.  Our incomes compare very favorably with those in any other developed nation, and they outpace the reimbursement for primary care doctors by a factor of between two and three. 

We need to acknowledge that a severe funding shortfall exists in American medicine and that it is affecting the health of our patients.  We then must take a leadership role in bringing down costs.  Ultimately, every health care provider, from doctors, to hospitals, to pharmaceuticals, must be prepared for sacrifices.  Some group must have the courage to stand first and be counted.  Specialty physicians can most easily afford to take this leading role.

By denying a problem exists on the cost side of the equation, physicians are excluding themselves from a leadership role in solving one of the great current challenges of American medicine: balancing health care spending with available revenue.  Emblematic of this attitude was the presentation of Resolution #8 at this February’s American Academy of Orthopedic Surgeons meeting which stated: “The…AAOS Board of Directors continue[s] to support the Association’s taking appropriate steps to challenge reductions in Medicare reimbursement for orthopaedic procedures” and even threatens unspecified litigation to defend us against such cuts.  Such a stance will not bring orthopedists, or any other organized medical group, to the table where new Medicare or Medicaid policies are crafted, nor will they help us defend our patients against unwise or arbitrary cuts in services.

Physicians, not politicians, understand which treatments are most effective and which promising therapies should be most vigorously pursued.  But if we continue to deny that costs are part of the problem and insist that governments simply need to find more and more money to fund organized medicine, politicians will inevitably make funding—that ultimately becomes treatment—decisions that physicians should be making, and this will not yield anything close to the best possible use of health care resources. 

After being fully informed of the enormity of their decision to defund bone marrow transplants, Arizona State Representative Jack Kavanagh, a top Republican, responded, “It’s difficult to be linked to a situation where people’s lives are jeopardized. . . .  Thankfully no one has died as a result of this, and I believe we have time to rectify this.”  Without physicians at the table, offering their expertise and to be part of the solution, Arizona’s legislators relied on faulty studies to guide their decisions.  Who does not believe that doctors could have provided much more nuanced, evidence-based proposals for saving the state money, particularly if a measure of financial self-sacrifice were on the table? Absent such input, other states will follow the lead of Arizona, and arbitrarily eliminate critical medical services, dooming some of their citizenry to unnecessary death or disease.    

The simple days of practicing medicine in this country are over.  We can no longer turn our backs on events occurring in our state and national capitals and the significance of these events for our patients.  Physicians have the knowledge and skills to help solve this crisis.  We must acknowledge that this exigency is upon us and work to save us all – physicians and patients alike – from this health care crisis.

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1 Trackback for “A Call For Physicians To Contribute To Solutions, Not Costs”

  1. Cost: News and Commentary - Health Care Cost Monitor
    August 17th, 2011 at 9:36 am

4 Responses to “A Call For Physicians To Contribute To Solutions, Not Costs”

  1. paradocs2 Says:

    Dr. Rickert, thank you for raising the issue and thank you for being so straight forward and honest about your own circumstances.

    I have a lot to say. I am a family doc in solo practice for over 35 years. If we docs pay attention, practicing physicians can make a whole lot of honest observations that can have a great impact on the system and public policy. I think most Docs do not have the interest to pay attention to what patients have to cope with in actually getting their medical care. I have a lot of cogent observations. First let me say that in my opinion the insurance companies have been and recently have grown into the biggest barrier to good medical care. They are also monstrously expensive and drain between 25 and 30% of the health insurance premium away from clinical care. That “health reform” should be based on having people buy into commercial insurance is a farce.

    (1) Just to pay attention to us docs for a minute…I know local hospitals and some of the finest local specialists who have chosen to drop out of large insurance programs (Blue Cross, Aetna, United Health Care) because their imposed provider payment rates are so low they cannot cover expenses.

    (2) Since the current recession started and state budgets have gotten into trouble Medicaid has become a nightmare. I feel a moral obligation to care for poor people, but now I have to waste office staff and time to obtain re-approvals for drug regimes already approved, for normal screening mammograms, for multiple re-requests for specialty care because the last two specialists approved are no longer participating, etc. I live in the central city and I just got approval for a MediCal patient with a fracture to see an orthopedist in the suburbs 30 miles away. Medicaid is just not a real health care system and for the President to make a large percentage of newly insured patients in his health reform plan enroll in Medicaid is going to be a farce.

    (3) Commercial health insurance premiums, co-insurances, and deductibles have grown so high that in my patient population they are huge barriers to needed medical care. For example, I now have patients who pay a $40 or $50 visit copay – which is more than their insurance company pays me for the visit. I have fully insured insulin diabetic patients who pay aver $250/ month for insulin and test strips since there are no generics available. One of these patients had 3 hospitalizations for DKA in the last 2 years.I have diabetics refusing referrals to eye exams, because of the added co-pay expense. A secretary who paid a $150 copay for her daughter’s tonsillectomy ended up owing over $1500 ( a substantial amount for her family) after hospitalization was required for post op bleeding.The ACA health reform preserves these copay and deductible burdens for most people.

    (4) And finally, these days about 15% of my practice is uninsured. As an experienced clinician I can often manage illnesses practically at little expense, but when MRI’s, CT scans, coronary angiograms, or endoscopies are indicated, the stretched kindness of other docs, the disdain of most facilities, and the collapsing and overwhelmed safety net institutions make appropriate care virtually impossible.I can only cry.

    I am inspired by the words of Dr. Berwick, now heading up Medicare, whose fine professional and moral ethic as well as his management expertise, has motivated him to be articulate about how important is is that there be justice and equity in health services as well as technical expertise and efficiency. It was stomach wrenching to see him pilloried for these high minded ideals. The corporate suits and financiers (and their bespoke politicians) are blocking progress in health reform and doctors must advocate for our patients and really fight to develop the integrated health system which our country deserves. Medicare for all would be the best first step.

    Jeoffrey Gordon, MD, MPH

  2. James Rickert Says:

    While I thank trturnbull for his comments, I believe that he is wrong about the number of physicians who would not see Medicare/Medicaid patients if reimbursement is dropped; I’d also dispute the notion that specialsists somehow lose money on Medicare or Medicaid patients.
    As the percentage of privately insured patients continues to decline, most specialists will have no choice but to see other patients; there just won’t be enough privately insured patients to go around. Already, Medicare and Medicaid account for the majority of most specialists’ patients.
    Also, the idea that we lose money on the treatment of Medicare/Medicaid patients is disingenuous. The reimbursement for these patients far exceeds the cost of their care, including rent, malpractice insurance, nursing, and the cost of billing. The residual money is profit for the practice. Only if a specialist includes inflated costs for himself does a paper loss appear. In other words, as an example, only if an orthopedist feels that he should earn $750,000 per year and values his hourly time accordingly, as opposed to our average of over $500,000 per year, can he feel that he is losing money on these patients.

  3. trturnbull Says:

    First, the Resolution, Resolution #8, passed with over 90% in support of all those who voted on it. Dr. Rickert’s views are clearly a minority viewpoint. Second, he should be wary of what he asks for. If Medicare or Medicaid reimbursement is reduced, many, if not most, specialists will drop out. Why should we work for less than we can make by seeing other better insured patients? No one asks Walmart to give reduced prices to the elderly or the poor. Doctors will drop out due to economic necessity. Already, most of us cannot make money seeing Medicare or Medicaid patients, including specialists.

  4. James Mhyre Says:

    The option of working with the state and federal legislative process to influence the government’s role in financing healthcare and reducing overall costs through various reforms including rationing or price fixing is neither available nor appealing to the vast majority of practicing physicians. But we are all patients too. We live the patient’s role with the medical consumption decisions that we and our families make and can be financially conservative, not just trying to maximize our benefits. We also collectively write the orders that drive most of American healthcare expenses. We need to work in our own practices and our own community hospitals to champion cost awareness and financial efficiency as another essential dimension in the clinical management process. This collective cost conscious ethic was prevalent during the managed care era a decade ago but has lost relevance in our current struggles to provide care to our patients while optimizing our own financial opportunities and mitigating risks.

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