This blog will hopefully give other docs an inside look at the trials and tribulations of transitioning a busy solo family practice office to a third party and managed care free practice.
Sunday, March 16, 2008
Leveraged Healthcare
The past ten years the change has not been for the better.
Demand has increased.
Supply has shrunk.
Why is this?
Health insurance has given patients access to physicians for copayments as opposed to true market fees. This is leveraged care at its finest.
The demand for primary care has gone up exponentially. But the respect we receive as physicians has shrunk.
Could the low copays have anything to do with it?
Is this good for our system?
I say No!
The present system will fail soon.
A good analogy is todays housing market and the subprime mortgage debacle. Homeowners paid very little for homes they thought they could afford. But the housing bubble artificially inflated the value of their homes. When the bubble burst, and when interest rates went up, they could no longer afford payments on their mortgage.
Our present healthcare system. Patients pay copays (subprime mortgages) for their healthcare. Healthcare costs are artificially inflated due to large overhead caused by government and insurance mismanagement. Take away the large overhead and insurance intrusion and healthcare (mortgage payments) would again be affordable.
What will happen when the insurers and government can no longer keep up with the artificially high demand?
Will they continue on the present course of price fixing and burdensome regulations that only add to the cost of care?
We need an end to leveraged healthcare.
We need a system that brings the cost of healthcare down.
We need a system that would make health insurance once again insurance, and not prepaid leveraged healthplans.
Taking money out of the system, opening up the free markets, would once again make healthcare more affordable, and cost our patients and the government less. The uninsured would once again be able to afford insurance.
But we need to first remove leveraged payments from our system!
Sunday, March 9, 2008
Solutions for our healthcare system
For our follow-up to our initial open letter to America, we must continue with our patient focused concerns. We must also show that we can make changes to the present system that will increase affordable access to care for all, and cost our government less. It will also keep the present industries in business, but would necessitate a change in the way they do their business. We are the workforce in healthcare. We have the power to induce change if we remain united in our goals. This followup letter must show our continued unity with a focus on improving our healthcare system for all.
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We the Physicians of the United States of America, have taken an oath to serve the medical needs of you our patients. As written in our previous letter, the present system makes it more and more difficult. It is wasting billions of dollars a year, increases patient and doctor dissatisfaction, and ruins the needed trust in the doctor patient relationship.
It is time for a change. It is time our healthcare system returned to the principles of our founding fathers, of individual responsibility, where medical decisions are made solely by you and your doctor.
Here are my proposals:
Medicare:
Freeze spending at 2008 levels- this will help our federal government keep costs down and allow Medicare to continue for future generations, while taking up less of our nations GDP.
- Allow doctors to balance bill patients above Medicare set rates. This allows doctors to keep up with their ever increasing overhead. This also allows doctors to remain open to treating Medicare patients. It also opens up Medicare to free market principles, which invariably will keep fees low and quality high.
- Allow secondary medicare insurances to pay more than Medicare if fees rise. These secondary insurers can compete in the free market, which they are very good at.
- End Medicare Advantage plans and the overregulation it causes.
- Means-test Medicare deductibles according to patients tax filings. Higher deductibles for wealthier patients, lower for poorer.
- Make preventative medical care for medicare recipients tax deductible.
Other Third Party Insurances:
- End Third party insurance meddling and determination of care. This third party intrusion into medical care has done the opposite of its intentions while producing profits in the billions. These profits drain the system of much needed resources for medical care. The profits based on ever increasing premiums have made health insurance so unaffordable to many, i.e. 47 million uninsured.
- End Insurance networks and give patients true choice in picking their doctors.
- End Referrals, preauthorizations, pre-certifications, etc.
- End insurance formularies, PBM’s which only serve to restrict and deny medications and increase profits for an unnecessary middleman.
- Stop P4P before it starts.
- Let the market decide the prices- lower cost alternatives will flourish!
End government mandates:
- all people should have equal access to care, but not all people need the same care. Equal care for all means mediocre care for all. One size does not fit all.
- Government should set up system of fair rules and then stay out of it. These rules should be enforced to go after the 1% of doctors, patients, and insurance companies breaking the rules, but leave the other 99% alone.
- Increase individual responsibility.
- Make healthcare insurance and payments tax deductible for individuals as well as employers. Employers should not be mandated to buy insurance for employees. But employers can compete for employees by joining co-ops for health insurance to allow their employees to purchase insurance policies based on individual needs. These policies become portable and individually owned regardless of employment status.
Increase availability of CDA’s and HSA’s.
- This increases individual responsibility while decreasing entitlement attitude towards healthcare. It may even encourage health savings for the future.
- Eliminate bankruptcies that allow discharge of medical debt. This increases individual responsibility and decreases use of our overcrowded emergency rooms. Primary care offices can provide cost effective care for non-emergent conditions.
- End lobbyists power over medical care and decision making. Medical decisions need to be made by doctors-patients PERIOD, and guided by free market principles.
Tort Reform: Defensive medicine cost billions. My local yellow pages has over 130 pages of lawyer ads, and under 40 pages of physician ads. Why the discrepancy?
- The present system allows for jackpot verdicts and is not sustainable. It is driving doctors out of business and into early retirement. A proper system is fair to all and does not increase the cost to all, for the benefit of the few who get jackpot verdicts.
- Propose a medical courts system where we are judged by our peers and not by public sentiment. This will allow for proper damages. It will also force change in the system to deal with medical errors as they occur. The present system does not.
Big Pharma: Your public perception is at the lowest it has ever been, and your stock prices are following. You need to change the way you do business. The free market will help your industry immensely. But todays back door deals with insurance companies and the medication-formulary system does not work for the greater good of our nation. For people without insurance to pay inflated costs to make up for the lower cost to insured patients does not work and is not fair. The system needs to have a level playing field.
- Immediately end DTC advertising.
- Have full transparency in medical studies. Publish all studies, not just those that support your products. No more manipulation of data. If you do, you will be called to task on it! You do not want a continuation of the Vioxx lawsuits.
- Stop dealing with third parties for pricing.
- End pharmaceutical formularies.
- With the cost savings, lower your prices to make your products affordable to all.
These are just my thoughts as a solo family physician. I am open to any and all options that we can add or subtract. But we need to focus on one common goal. What is best for our patients and sustainable for our nation.
Steven Horvitz, D.O.
Founder Institute for Medical Wellness
Sunday, March 2, 2008
February Analysis of Cash Transition
February 2008:
1st two months – January-February 2008 transition to Cash Only + Medicare
Solo physician, suburban practice, large HMO penetration.
Conversion to cash practice, Medicare, and Wellness-Retainer model at affordable market based prices.
January and February’s numbers may not indicate future months as some old insurance money came in and is included in percentages given.
Also 2 insurers remained thru part of January due to their contractual terms that I chose not to fight as it only set me back a few weeks.
But February’s old insurance money was very low as compared to January.
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Comparisons given below are percentages comparing Jan-Feb 2007 to January-Feb 2008.
I will try to post further months and quarterly data as it comes in.
Patient Volume decreased by 33% for Jan-Feb 2008
New patients seen decreased by 63% for Jan-Feb 2008
$ per patient seen increased by 204% for Jan-Feb 2008
Revenues increased by 73% for Jan-Feb 2008
Old insurance money should not take me thru further than March 2008. Feb 2008 revenues are consistent with Januarys with much less in old insurance income.
Ok All, Lets here the questions and comments!!
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The numbers posted above reflect my suburban solo family practice in a highly penetrated managed care location.
The numbers so far are very encouraging. However they may not indicate the future.
A large part of the initial revenues have been from established patients enrolling in my practices Wellness plans. The enrollment fees start at $200 per year. For more info on the wellness options please click here. In order to sustain the revenues and the increase in $/patient I must continue to enroll patients both new and old in these plans. I hope that March 2008 has equal numbers to the first two months, but April and on need to bring in new patients to the practice. I do intend to start a marketing plan shortly to bring in these new patients. I have had a few so far, and I believe word of mouth will spread to bring in these new patients as it always has in the past.
Why the optimism? The patients who have enrolled so far in the wellness plans have stated to me they are very happy with the product and feel the fees are very fair and reasonable. Also the service we have been able to provide with same day appointments and improved patient advocacy has been very well appreciated by my patients.
What are the problems so far?
The biggest problem so far has been patient’s not understanding that health insurance networks do not dictate who they can see for their medical care. They feel they are breaking rules if they go out of network. They do not understand that they can pay directly for an office visit without using insurance.
Some believe that as an out-of-network physician that they will not have coverage for prescriptions, or other care accessed outside my office if I prescribe it. These are all issues that I have found need a lot of hand holding and teaching of how the system truly works. Once I explain how nothing changes other than my fee, a light goes on in their heads and it becomes a decision of a few extra dollars per visit to see me.
Another problem is all the other doctors in my area who still take their insurance and are thus cheaper per visit than I. But, I have already had half a dozen patients return to my office due to the inability of these other offices to accommodate same day appointments for sick visits.
Other Good Effects:
Expenses have gone down. My medical billing expenses have been slashed by at least 75%.
I have eliminated one medical assistant during my day hours, and went from two to one medical assistant during evening hours. I anticipate my payroll expenses to be slashed by about 25-30%.
For other good effects for my patients please see my blog post of 2-20-2008.
Wednesday, February 20, 2008
Copy of letter to my patients 2-20-2008
We near the end of February, nearly two months into the transition of my practice. Many of my patients, peers, friends and family have asked how the transition is going. So far, so good. The goals I have set for my practice are being met.
Please allow me to list a few of these:
1. Same day appointments- If you are not feeling well and need an appointment, the last thing you need to hear from your doctor’s office is that they can schedule you in three days. That just does not work! We have always offered same or next day appointments, and now if you call our office before noon on a workday, you will be offered a same day appointment. My father was also a family physician in a solo practice. He would always tell me, “Make sure you get patients into your office when they are sick, because if you wait a few days they may not be sick anymore.” I have followed my father’s advice.
2. Longer appointment times- When my office participated with health insurance companies, the large overhead expense forced us to try to see more patients per day. This would often cut into the length of time available per patient. Average appointment time prior to my transition was 12-15 minutes. Now we are scheduling for at least 20-minute appointment times, and longer for Wellness exams and physicals. My goal is that each patient gets the time they need for a full and comprehensive evaluation.
3. Less waiting time- With longer appointment times, I have finally been able to run on schedule. No one is perfect, but I have been doing a much better job of seeing patients at their scheduled appointment times. Another side benefit is less crowded waiting rooms and less time in the waiting room. In fact I am considering canceling some of my magazine subscriptions as no one is finding time to read them.
4. Creating a medical home for my patients- When contracted with health insurance companies my office staff and I would usually spend 4-6 hours per day on bureaucratic paperwork, referrals, precertifications and other health insurance nonsense that should have no place in our healthcare system. Well, no longer!! We now have time to serve as your sounding board to medical advice and treatment rendered by other caregivers and specialists. My office staff also has the time to help with the facilitation and coordination of your healthcare. This includes scheduling diagnostic tests and also referring and scheduling appointments with specialists.
I would like to restate my practice mission statement, as the words below are the standard of care that my office pursues.
To provide outstanding family medical care to our patients with a focus on comprehensive wellness and prevention.
To inform you of healthcare options that your health insurance carrier may not want you to obtain or know about.
To be an advocate for your medical care without regards to the health insurance bureaucracy.
Where patients go to be treated as a person and not as a commodity.
Where patients go to have a Physician who listens carefully and respects what the patient has to say and encourages the patient to say what is on their mind.
To give patients the ability to see their own Doctor and to make appointments without unreasonable waits.
To provide this care with an open mind, and to make your healthcare a team effort between Dr. Horvitz, his office staff, and you, the individual.
I appreciate the trust and confidence that my patients have shown in me. I take my job and my profession very seriously and I strive to treat every patient as I would want to be treated myself, and as I would treat my own family. I will always do my best to make every office visit or phone conversation worthy of your time.
If you have any suggestions or comments on how I can make my practice work better for you, please call or email. I will be happy to hear from you!
Steven Horvitz, D.O.
Founder Institute for Medical Wellness
Sunday, February 17, 2008
The Dumbing down of our profession
Twenty years ago we were called physicians and the people we treated we referred to as our patients, family, friends and neighbors. What are they referred to as today?
· Covered lives
· Health Care Consumer
· Capitated life
· “Name the Insurer” patient
· HMO patient
· PPO patient
With our entry into managed care we gave up the management rights of our profession and handed it over to corporate CEO’s of the health insurance industry. These corporate CEO’s have managed to increase year to year revenues and profits on the backs of physicians, hospitals, patients, and employers. Profits of the health insurance industry is in the billions year to year and continues to increase while payments to those that provide the medical care decreases.
How much money is spent on the insurance infrastructure that does not go into patient care?
If we were to take half of these profits and unneeded infrastructure out of the equation, could we put it towards better use?
Lets see some of what this insurance infrastructure has created by looking at an entire new medical vocabulary.
· Provider
· In-network provider
· Out-of-network provider
· PCP – (primary care provider)
· Physician extenders
· Prescriber
· PBM’s – (Pharmacy Benefit Managers)
· Formularies
· Tier 1, 2 or 3 medications
· Generic equivalent
· Managed Care
· Capitation
· Copay
· Precertification
· Preauthorization
· Insurance referral
· Utilization review
· Quality Assurance
· Incentivize
· Pay for performance
· Third party payer
· Contractual adjustment
· Assignment
· Claims
· Payers
· DRG’s
· Universal Healthcare
· HIPPA
Did any of these words appear in any medical dictionary prior to managed care?
Do you evaluate any patients in your office without using one of the words listed above?
My father was a family doctor prior to managed care. Had he been alive today, but in a twenty year time bubble, he would not understand the mess we have gotten ourselves into. He would say, “Just treat your patient’s well and to the best of your ability, and you will have a good career, a good business and a good reputation in your community.”
How many of our medical offices today are run with my fathers thoughts in mind?
Instead we have reacted to this insurance system quagmire in many ways.
· We try to see more and more patients each day.
· We hire more clerical and billing staff to handle intrusive rules and regulations.
· We go to seminars that attempt to teach us cost-effective healthcare.
· We hire physician extenders.
Does any of the above help with patient care?
Can we really evaluate and treat our patients in the 8-10 minutes we give ourselves?
So we hire medical assistants, billing managers, office managers and health care consultants to help run our practice.
They all help in the day to day operations of our practice, but how much of their time is actually spent with patients, and how much time is spent pushing papers, or on the phone with an insurer, etc?
We go to seminars that tell us to use electronic billing, to buy an electronic medical record, to organize our office to comply with all the insurers and governments rules and regulations. Does any of this help in our evaluations of our patients?
They tell us how to see more patients per day, and how if we only stay open every weekend and five nights a week, that our practices will thrive. But I for one, enjoy my work, but I work to live, not live to work!
Nurse practitioners and physicians assistants are hired to medically evaluate our overflow of patients. Is this a good for our profession? Are we allowing physician extenders to become commonplace in our healthcare system? If we hire them, are we not giving our blessing that they can do our jobs as well as we can? In essence we are hiring our own replacements.
Big business has also reacted to high healthcare costs. Walk in clinics staffed by nurse practitioners and physician assistants are growing quickly. Walmart clinics, and Minute Clinics are in direct competition with family practitioners. They are treating the bread and butter illnesses of our patients, which accounts for a nice percentage of most offices revenues. Do we accept these clinics as inevitable, or do we devise a strategy to compete?
Can we compete?
Do we have the will to save ourselves?
Can we enlist any group to help?
Who will understand the most?
Who needs us the most?
Who is closest to us?
· Lawyers?
· Insurance industry?
· Politicians?
· Hospitals?
· Universities?
· Media?
· Congress?
· President?
· Governor?
· Democratic or Republican party?
Can you find ONE in the list that has any interest in helping our profession get out of this mess and make a better system?
Our patients are the one group that we must get on our side. This will not happen if all we do is complain, without offering solutions for high quality and affordable healthcare. We can abandon all third party payers but we must not abandon our patients. We can and must reform our healthcare system by returning the pricing power to the physician, cutting out the middleman, and return to the primacy/centrality of the doctor-patient relationship. It is a trend we as a profession must set by example.
With the presidential election approaching, and the candidates all proposing fixes to healthcare, setting an example with a unified front must not be a dream, but a reality. All of these have factored into the dumbing down of our profession in our eyes, our patients eyes and the government eyes. If we are to survive as a profession, we need to take control back. We must act to set the rules before we lose control of our profession forever.
Steven Horvitz, D.O.
Founder of The Institute for Medical Wellness