Cover Story

Primary concerns

"Primary concerns" Continued...

Issue: "Medical care circus," Feb. 25, 2012

Scott Bledsoe is quick to emphasize that their medical practice provides plenty for their family's needs, including private school for their children. Their lifestyle is comfortable, but not as lucrative as it could have been if he and his wife had stayed in their previous careers. For Bledsoe, medicine is intellectually challenging and personally rewarding: "We could probably make a lot more money in medicine than we do. That's just who we are."

Other doctors I spoke with gave me more information on how they make money. Family physicians are paid less than most other doctors. Medicare uses a relative value scale to determine how much to pay for medical services, and primary care visits are near the bottom of the scale. A 25-minute office visit with a primary care doctor has one-tenth the relative value of services such as cosmetic surgery on the forehead or repairing a broken upper arm.

Medicare's reimbursement scheme is important because most private insurance companies apply the same principle of paying less for primary care than other services. Reimbursement rates for Medicaid, the government insurance program for people with low incomes, are set by state governments. On average, Medicaid reimbursement is 66 percent of what Medicare pays, though Medicaid rates are nearly equal to Medicare in the state of Kansas, according to the Kansas Health Institute.

While primary care doctors don't get much respect from Medicare, they can save the healthcare system money by applying the right preventive care at the right time. A 2004 study published in the journal Health Affairs found that the more primary care physicians a state had, the lower its healthcare spending. Adding one primary care physician to a population of 10,000 people reduced that population's Medicare spending by $684 per patient.

With inflation and practice costs rising faster than reimbursement, physicians have had to get creative to keep their businesses profitable. At Galichia Medical Group in Wichita, a practice with more than 20 primary care doctors and specialists, Dr. Chris Meyer, CEO of the group, treats most of the practice's Medicaid patients himself. "The docs are on a production salary; I am not," Meyer says. "I choose to do that so they don't have to."

One of Wichita's largest family practices, the Wichita Clinic, recently sold to local hospital system Via Christi Health. Dr. Kevin Hoppock said the more than 160 physicians of the clinic decided after the advent of Obamacare to hand over management to a larger corporation in hopes Via Christi could help bear the burdens of government regulation. Via Christi's Chief Finance Officer David Hadley said the hospital system hopes owning the practice will help it experiment with newer, more cost-effective models of care.

As family physicians look to the future, they have gloomy predictions about how much the current healthcare legislation can improve their situations. Obamacare would make more people eligible for Medicaid, as well as require states to close the gap between Medicaid and Medicare reimbursement. The most controversial portion of the act, requiring Americans to have health insurance or pay a penalty, would also likely lead to more people on Medicaid or Medicaid-like programs. The act does nothing to change the system for calculating payments, which puts primary care physicians at the bottom of the payment barrel.

In the meantime, Congress is considering cutting Medicare reimbursement by 27 percent. The cut is part of a formula called the Sustainable Growth Rate, which is supposed to make up for Medicare overspending. So far Congress has delayed the SGR cuts, but hasn't announced a plan to cover the costs of that delay, which runs out March 1.

Dr. Dee Ann Stults treats patients at a Wichita clinic primarily for uninsured and underinsured patients. She said she has access to more charitable resources for patients with no insurance than patients who have state-based insurance: Obamacare, she worries, "might create a large population of people who are underinsured or people who have some semblance of coverage but it doesn't really get them very far."

Just how large will the population of underinsured patients be, and how will that affect access to healthcare for all patients? One healthcare administrator I spoke with said a "tsunami of demand" is headed toward primary care clinics. Physicians would have to hire more mid-level providers to handle the demand, and longer wait times are likely.

The Supreme Court is set to hear arguments on the constitutionality of the law in March. If the law stands, officials who oversee Medicare have called the Patient Protection and Affordable Care Act unsustainable financially. One way the act proposes to fund the increase in Medicaid is by "substantially reducing the growth of Medicare payment rates for most services," according to the Congressional Budget Office. Healthcare providers will supposedly respond to lower increases in payment over time by becoming more efficient and cost effective.


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