False Assumptions

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Commentary - April 2009  


Tex Med . 2009;105(4):5-6.  

By Bohn D. Allen, MD  

The fact that employers turned to health care payment plans to control the escalating cost of health care is not a testimonial to the value of managed care. Rather, it is a failure of the employer to understand free-market dynamics and the fact that it is impossible for an employer to understand the health care needs of his individual employee (i.e., choice and self-determination of medical care).

In the past 20 years, patients have relinquished their health care needs to their employer, the government, and the insurance companies. They have depended on their physician to be their advocate for the care they perceive they need or want. Physicians are forced to police a system they did not want or create. The result is a fractured patient-physician relationship.

Consumers and physicians are demanding that individual patients be allowed to reclaim control of their own health care decisions through individually selected, purchased, and owned health insurance. Insurance companies must accommodate this dynamic and no longer depend upon the employer to purchase employees' health insurance. The employer-directed health plans now require such high deductibles, copays, and premiums that employees essentially are paying the major cost of the insurance without choice of the plan or their doctors. Employees no longer see value in these employer plans and are opting out of them. Insurance companies, in the future, must market individual health care policies to remain competitive. This approach will force third-party payers to create value as perceived by the consumer (the patient) and get rid of the one-size-fits-all mentality.

The strongest endorsement of consumers wanting to take back control of health care was their rejection of the HMO concept and capitation. They demanded choice of their physician, hospital, and point-of-service. This will be why the public will reject the concept of a nationalized one-payer system. In an information society, consumers are in control. 

"Fighting for Survival"  

In our current arcane reimbursement system, which pays physicians less than their cost of providing services, physicians are forced to devalue their services to a point that they are fighting for survival. This is not by the choice of physicians. The commercial payers have unconscionably adopted the same payment level of the government without negotiation, using the leverage of the Federal Trade Commission and the Department of Justice to enforce their policies.

Thus, physicians must work harder and longer, see more patients, and perform more services to generate enough cash flow to pay their overhead and keep their doors open. In spite of that, the 2008 TMA physician survey shows that 74 percent of physicians have to subsidize their practices, by either foregoing income or taking out loans. Many have given up funding their retirement. As a result, many physicians are dropping out of the traditional practice of medicine and are turning to large groups, employment opportunities, ancillary services, alternative, or complimentary medical practices paid for outside of the traditional insurance reimbursement system. Many doctors in primary care are turning to direct-access practices, health information coordinators, and other services paid directly by the patients.

When physicians devote one-third of their lives to obtaining their education, training, and experience, they are going to figure out a way to make a living. They have to! They have too much time and expense invested in it. Most physicians don't even start earning a living until they are in their 30s and are still faced with paying off $200,000 in medical school and residency debt. 

Physicians are not less caring or less devoted to their patients. They have not abandoned their moral or ethical calling; they are simply trying to survive in a system they did not create. Contrary to the belief of some, they are not greedy! They are simply trying to get a return on their investment of time and money and at the same time perform a service to mankind for which most have had a personal calling.

The economic reality is that physicians are locked into a system with their hands tied behind their back and forced to operate by a set of economic rules they have no power to change. They have no legal authority to negotiate the price of their services or to strike. There is no other profession in such circumstances or that would tolerate it. It is amazing that many physicians are still functioning in an environment that pays them less than they received in the 1980s and less than their costs.

If we don't resolve some of these conflicts, physicians will retire early, find other business models, or drop out of the system. We already face serious physician shortages in the near future, especially primary care physicians and some specialties. If this occurs, the patients ultimately will lose access to care; no system, including a nationalized system, will solve the problem; and rationing will result. In spite of all of these problems, for the immediate future, physicians will remain true to their calling and will continue to labor in the trenches taking care of the sick and injured, hoping for better times and days.

Dr. Allen was the 2004-05 TMA president.  

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Editor's Note: The views contained in this commentary do not necessarily reflect the views of Texas Medicine or the Texas Medical Association.