Medicare- Should we still participate?

As you may know, at least those of you who have followed my blog, my practice is free of third parties, other than Traditional Medicare. My reasons were many, but one of the main reasons was that Medicare did not put burdensome rules and regulations between me and my patients.

If I need an MRI, I give my patient a prescription. No referral or precertification necessary. So I did not see a reason to stop participation with Medicare, especially as Medicare, in my area of New Jersey, is actually a better payor than other insurers.


But now, we are being threatened with a 21% fee schedule reduction for Medicare. While it may or may not occur, I am getting pretty tired of all the b.llsh.t. There will come a point, and it may be soon, that Medicare, in my office, will no longer be accepted. Medicare accounts for about 15-20% of revenues. If I withdrew participation, I would probably keep about 30-40% of my Medicare patients, similar to the percentage of patients I retained when I terminated other insurers. If other docs stop taking Medicare as well, I would probably retain more. Revenues from "Medicare patients" would probably remain neutral.


Every practice needs to make a decision for themselves. But if you want my advice, and since you are reading this blog, you at least want to read my advice, it is to make plans to opt out of Medicare, as well as all your other insurers as well. Start acting like any other small business, and market your product directly to your customers, who happen to be your patients.

Physicians are responsible for the healthcare mess we are in. We allowed ourselves to be drawn into the third party system, with the hope of growing our practices. We hoped that the third party system would change our incomes for the better.

So I have a question for you.

Just how is all that hope and change working out for you?


Start planning your escape from the third party system. If you are a specialist, who relies on big ticket procedures, start trimming your overhead, and bring your fees to an affordable level, that still allows you to profit. If you are in primary care, it should be an easier adjustment, as primary care usually has less big ticket items. I dropped my practice overhead by 50% when I made the transition. As I had no business background prior to starting my practice in 1998, yet I was able to develop a healthcare business model that works, there is no reason why you can not!

And for all the docs on salary at hospitals or in academia, who do not feel threatened by Obamacare, what will happen to you, and to your salaries, when your hospital system can not afford to stay in business due to lower "reimbursements"? The first place they will go to make up for the cuts will be your salaries or your jobs.

So the physician community must get together, to take back control of our profession, and move it away from third party control, whether from government or insurers. Start your plans to drop Medicare, along with all the third parties, before it is too late!