This gave me my chuckle for the day (I have a very dark sense of humor). The American Medical Group Association, an umbrella organization representing medical groups including such groups as the Mayo Clinic, has looked at the administration’s proposal for Accountable Care Organizations, one of the PPACA’s flagship strategies for delivering quality care to patients at an affordable cost, and become alarmed. Here’s a snippet (PDF) from the letter the organization sent to Donald Berwick, the chief administrator of the Centers for Medicare and Medicaid Services:
We write today, however, to express our serious concerns over the direction of the Proposed Rule. On its face, it is overly prescriptive, operationally burdensome, and the incentives are too difficult to achieve to make this voluntary program attractive. As you know, most policy experts believe multi-specialty medical groups are best poised to become ACOs in the short term. However, in a survey of AMGA members, 93 percent said they would not enroll as an ACO under the current regulatory framework.
In addition, the letter openly acknowledges something I’ve been saying around here for a long time:
Further, if ACOs are not successful, we are concerned that the only alternative to future delivery system “reform†will be draconian cuts across the provider spectrum. Such an approach would not change the way we deliver health care and ironically, would likely result in greater volumes of services provided.
or to paraphrase, if the reimbursement per procedure is reduced, we’ll jack up the number of procedures we perform to make up the difference.
Let me repeat this very plainly. We can’t afford to let the cost of healthcare increase at the present rate and we can’t reduce costs within the confines of the fee for service model. We need basic reform.
Hat tip: Associated Press
“…to paraphrase, if the reimbursement per procedure is reduced, we’ll jack up the number of procedures we perform to make up the difference.”
Our very own steve said this very thing to me in an Obamacare debate at one point. I’m sure you keep archives and could find the thread and comment if so motivated. I asked steve if he really meant that, and if was not just an ill thought out an emotional response or brain cramp. He did not take the opportunity to recant.
I just don’t understand this approach to medicine. Perhaps my father was a rare bird, but he spent a great deal of time telling patients they weren’t sick or didn’t need such and such procedure, and no he wouldn’t prescribe this or that. However, many times they simply quit his practice and went where they could get what they wanted. Perhaps this informs my worldview that the patient needs to be exposed to price. I don’t think you would have the same dynamic if that was the case.
If I gauge things correctly your dad would have been a few years older than I. That means he would have graduated from med school some time before 1965.
I think that makes a difference. Prior to 1965 physicians could earn an income that was comparable to that of other professionals. Afterwards, they could earn an income that was a multiple of what other professionals could expect. That had the unintended consequence of attracting different people to the practice than had previously followed it. I remember an editorial in the NEJM a few years ago which characterized the practice of medicine as offering a perfect combination of doing good and doing well. From my point of view that’s a very bad attitude for a professional.
Dave –
Let me modify that somewhat. My father graduated in 1958. Its just an anecdote, but I recall a conversation with him at one point when he pointed out that my grandfather, also a GP, counseled my father as he was starting out to “get his shot practice going.” My father was incredulous. “I went into medicine to practice medicine, and to have a relatively autonomous lifestyle, not to make money.” (Although fully understanding he would be relatively financially well off. He originally was a language arts graduate who taught at a military academy; riches and autonomy were not in the cards there.)
I’ve worked and associated with some of the best, and the filthiest and despicable, people on the face of the earth. In a steel mill, large corporate, small business, private life, and the rich and famous. The best, and the filthiest, reside in all those camps. Its really all about character. Period. Not money per se. Its one of the reasons I laugh, and know I’m not dealing with the sharpest knife, when I hear current events attributed to “Wall Street greed” or such, as if greed was invented recently, or doesn’t infest many professions and individuals.
I’m not naive. Wasn’t born yesterday. But I just don’t conduct my life in such a fashion or think others should. Perhaps more to the point of your essay, I believe that realiance on market checks and balances as people inevitably pursue their own self interest is the best way for us to conduct and police our collective affairs, as imperfect a model as that sometimes may be. Apparent free lunches just don’t work.
PS –
Much of the “non profit maximizing behavior” I cite, and what became an issue between my father and mother, occurred in the 70’s and 80’s.
Drew- When I said we, it was a generic we. I am somewhat, though not entirely, limited in the ability to increase numbers of procedures in my specialty, anesthesia, but even if we were not, my group is, if I do say so, pretty ethical about that kind of stuff. We pass on a good bit of free money. (I have written quite a bit about this at my own place of and on. For many years my hospital was by far the low cost hospital in our area. My group was the low cost group in our area for our specialty. This did not increase our market share.) However, I know a few docs who do not hesitate to maximize income. Fortunately, they are a minority. Much more insidious is the invisible hand at work. When you look at the wide disparity in utilization rates across the country, it usually centers around practice style. Money is more of an indirect motivation.
This is also the point I keep trying to make with Dave. If all you do is cut fees for providers, you may end up incurring much higher costs for the whole system since doc salaries are much smaller than the spending they control. I still think that utilization is the way to go
Steve
steve –
You know me. I make a statement such as I did to elicit just the type of response you gave. All professions – all of lifes defined groups – have a range of persons and personalities and characteristics. (Its one of the reasons generalized comments such as “Wall Street greed” or “greedy bankers” are so foolish.)
I have no idea how much control you have over the practice. But I’ve often thought that medicine is one of those professions that has not done a good job of policing its own. This opens it up to all the demagoguery of politicians, the trial lawyers and suspicions of the general public.
To coin a phrase, you are in the crosshairs of the current administration. Good luck.
PS – to be clear. I understand your dilemma. “Hedge funds” are a current favorite political whipping boy. People consider our fund a “hedge fund.” They don’t know what they are talking about or what we really do. But the regulators (Dodd-Frank) are coming after us as if we were doing some of the shennanigans of the NY and international big boys. Its just political crap.
Now I have to get back to the business of firing widows and orphans, and stripping assets to leave smoldering hulks of once great companies…………
There are a lot of gray areas. You can either wait out a pregnancy, consuming your time and energy for a delivery that will ultimately bring in less money. Or alternately, in a gray case, you can perform the C-section, get more money, and spend the weekend with your family. The temptation to do the latter, particularly in a 50-55 hour/week job, is pretty great. And you’re not doing a needless c-section. You’re just taking a case where you could go either way… and going a particular way.
(My wife is relatively conservative about such things and has a c-section rate of a little over 10%. This is significantly below the hospital’s expectations. When it comes time for salary negotiations, we expect this to be brought up.)
So you have some mercenary docs out there, who are probably few but cost the system a whole lot of money. You have some docs for which everything is a nail for the hammer that they have (hospital equipment, scalpel, etc.), as well as situations like the above (though I don’t know where else that might apply but obstetrics).
Another factor in the transition is, I think, the medical malpractice environment. Even if it’s way overblown (and I think it often is), it’s something that doctors feel very intensely. On top of the guilt about not having done everything you could, if something goes wrong. So there are other incentives to do more.
That being said, if you passed national tort reform tomorrow, it could well be that there is a lot less saved that people suspect. Whatever aggressive care was originally the result of defensive medicine has become standard practice. But it’s another factor in why medicine has changed over the years.