The Healthcare Bill, Rage, Concierge Practices, Cuts, Claims and Don Berwick (Yes!)

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HEALTHCARE BILL IMPACT ON INDIVIDUALS AND RAGE

A number of people asked me about the impact of health reform on them as individuals.  Here is a great story from the Atlanta Journal-Constitution that takes specific examples of individuals and families and speculates on how the new bill(s) will impact them.

For 2010, the changes are minimal:

  • Dependent children may be covered by their parents’ health insurance policies until age 26.
  • A high-risk insurance pool will open for people with pre-existing conditions who have been uninsured for six months.
  • In 2011 Medicare will pay for an annual checkup, and deductibles and co-payments for many preventive services and screenings will be eliminated. The Medicare prescription drug doughnut hole will gradually narrow every year until it is eliminated in 2020. People in the  “doughnut hole” could receive a $250 rebate this year.

I have to say that I’ve been dumbfounded by the fury raised over the passage of the new healthcare legislation.  I realize that the bills separate people into winners (uninsured, providers with uncompensated charity care, patients with pre-existing conditions, Medicare patients, providers who see Medicaid patients, families with adult children, etc.) and losers (companies who have to pony up more money for their retired employees, insurance companies, illegal immigrants, high wage earners, etc.), but this story placed the fury into a different perspective for me.  It’s a good read.

CONCIERGE PRACTICES

What does healthcare reform mean for the physician practice?  Many are predicting the rise of concierge practices (also called boutique medicine, retainer practices, VIP medicine and cash practices) as physicians find they cannot survive if their patient population is predominantly Medicare, Medicaid and uninsured patients. Concierge practices fall into two categories:

  • The first operates on an insurance+ model, which means that the practice accepts and files the insurance for the patient, but also requires an additional out-of-pocket fee of anywhere from $1500 to $1800 per year to be a patient of the practice.  The fee is to cover services that Medicare and commercial insurance do not, such as physicals, phone consultations, wellness counseling and patient education.
  • The second operates on a strictly cash basis and the practice does not accept or file any insurance for the patient.  The patient pays a flat fee per year for care (usually in the $5,000 to $15,000 range) and all primary care is provided for that amount.  The patient still needs to carry insurance for prescriptions, hospital services and sub-specialist services.  Imagine being a manager in this type of practice – no pre-authorizations, no insurance department, no eligibility checking, no refunds…

Concierge medicine has not been around that long, but it is growing in popularity by leaps and bounds. The first acknowledged concierge practice was formed in 1996 in the Pacific Northwest.  In 2002, CMS (Centers for Medicare and Medicaid) published a memo stating that physicians may enter into retainer agreements with their patients as long as these agreements do not violate any Medicare requirements.  In 2003, the Department of Health and Human Services ruled that concierge medical practices are not illegal. Today, there are approximately 5,000 physicians using the concierge model in the United States today.

MEDICARE CUTS, MEDICARE CLAIMS AND DON BERWICK

Shortly after all the shouting and voting on healthcare reform was over, Congress recessed for two weeks leaving the controversy over the 21.5% cuts required by the SGR formula still unsettled.  CMS has advised the MACs to again hold claims for services provided from April 1 to April 10 to give Congress a chance to get back to work and back to voting for an additional delay (or not) for the cuts.  If the cuts are allowed to stand, many physicians will start making their own cuts by minimizing the number of Medicare and Medicaid patients they will see.

Amidst this craziness, a voice of sanity is heard and it is Donald Berwick, MD, current President of the Institute for Healthcare Improvement (IHI) and probable Obama pick for the head of CMS. If you don’t know Don Berwick or the IHI, click here to read an interview with him about the IHI’s “100,000 Lives Campaign” or watch the video below of him speaking about the dimensions of quality.  Good stuff!

Posted in: Finance, Headlines, Medicare & Reimbursement, Memes

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2 Comments

  1. Cheryl Katz April 22, 2010

    I worked in a “boutique” cash-only group and the model was that the patients paid per our fee schedule and then were given a generic form to submit to their insurance companies for reimbursement.

    Our Pediatricians did not have to enroll in managed care plans and could collect an amount sufficient to stay in business because they had great reputations. They could provide hours of counseling and education especially to teens and anxious new mothers.

    But… oy the amount of work for the Manager and the parents. The paperwork that still was generated by their insurance companies and the need to collect from these new “self-pay” parents (especially the divorced ones) created a ton of new work.

    Cheryl, MPA

    • Mary Pat Whaley April 24, 2010

      Hi Cheryl,

      Thanks for sharing your experience in a cash-only practice. I know many of us wonder what it would be like to manage a practice that does not file insurance. It’s interesting that you comment on the paperwork regardless of not filing insurance – I’d like to hear more about that.

      Best wishes,

      Mary Pat