Posts Tagged ‘insurance reimbursements’

Is End-of-Life Care Worthwhile?

Monday, August 27th, 2012

Even in the age of advanced healthcare directives and living wills, Americans still must cope with a dilemma when it comes to end-of-life healthcare for themselves or their loved ones.  Consider the fact that Medicare pays as much as $55 billion annually for physician and hospital bills during the last two months of patients’ lives.  That’s more than the budget for the Department of Homeland Security, or the Department of Education.  Estimates are that 20 to 30 percent of these medical expenses usually have no meaningful impact.  The federal government pays for a majority of the bills with no questions asked.  Medicare spends nearly 30 percent of its budget on beneficiaries in their final year of life.

Given this information, the question is whether extending someone’s life is worth the money it can potentially cost.  The solution potentially could have been a snap for Congress when it passed the Patient Protection and Affordable Care Act (ACA).  Unfortunately, the previously bipartisan issue quickly became a political hot potato.

According to Dr. Ira Byock, it costs as much as $10,000 a day to maintain someone in the intensive-care unit, even if the patient remains there for weeks or even months.  “This is the way so many Americans die. Something like 18 to 20 percent of Americans spend their last days in an ICU,” Byock said.  This discussion raises the philosophical issue of the value of human life.   According to Byock, “While many people question spending a lot of money to prolong the life of an elderly, frail patient, it was perfectly logical for a frail person to value life extension as much as a perfectly healthy person.  With advances in medical care, it can be argued that the value of hope has been increasing along with the statistical odds of staying alive until a cure is found.”

Over-treatment, according to Byock, is an unfortunate side effect of medical advances.   “We have enormous scientific prowess and remarkable diagnostic and treatment,” so that when you are admitted to the hospital, the system “moves you quickly towards the next diagnosis and then the next diagnosis after that for the next component problem in a whole picture that few people will see.  It’s a dysfunctional system that feels like a conveyor belt.  We have a disease-treatment system rather than a healthcare system caring for human beings.”  Byock notes that the same system can lead doctors and patients to regard any reduction in treatment, or even accepting that patients are going to eventually die, as failure.  There are amazing ways to combat disease and extend life.  “That’s all well and good.  The problem is, we have yet to make even one person immortal,” Byock concluded.

Dana Goldman, director of the Schaeffer Center for Health Policy and Economics at the University of Southern California and founding editor of the Forum for Health Economics and Policy, has a difference approach.  According to Goldman, “We think of healthcare as an expense, but we really should be thinking of healthcare as an investment.  We want to invest where we have the greatest return. I would put prevention in that bucket.  But the way we do it now, no one has an incentive to invest in things with a long-term return.”

Some of America’s Doctors Are Going Broke

Wednesday, January 18th, 2012

Many of America’s physicians have an embarrassing secret — they are going broke. This quandary is claiming a wide range of casualties, including family physicians, cardiologists and oncologists.

Industry insiders are concerned about the trend.  Approximately 50 percent of all doctors operate a private practice. If a cash crunch forces the closure of an independent practice, it robs a community of a vital healthcare resource.  “A lot of independent practices are starting to see serious financial issues,” said Marc Lion, CEO of Lion & Company CPAs, LLC, which advises independent physician practices about their finances.  Doctors say that smaller insurance reimbursements, changing regulations, soaring business and drug costs take away from their practices’ profitability. Some experts counter that doctors’ lack of business sense shares the blame.

Recent steep 35 percent to 40 percent cuts in Medicare reimbursements for key cardiovascular services, such as stress tests and echocardiograms, have taken a substantial toll on revenue for cardiologists, as an example.  Federal law requires that Medicare reimbursement rates be adjusted every year based on a formula tied to the economy’s health. That law says rates need to be cut every year to keep Medicare financially sound.

Although Congress has blocked those cuts 13 times over the 10 years, most recently on December with a two-month temporary “patch,” this dilemma haunts doctors every year.

Beau Donegan, senior executive with a hospital cancer center in Newport Beach, CA, is well aware of physicians’ financial woes.  “Many are too proud to admit that they are on the verge of bankruptcy,” she said. “These physicians see no way out of the downward spiral of reimbursement, escalating costs of treating patients and insurance companies deciding when and how much they will pay them.

“This is a very timely and truthful story for doctors and hospitals in America. This is also a 911 call for U.S. healthcare security.  More importantly, when a doctor is ‘$3.2 million in debt’ or has to force 6,000 cancer patients to look for a new doctor”, as reported by CNN Money, “our healthcare system infrastructure earthquake is coming,” says Dr. Jin Zhou, president of, a national expert on PPACA and ERISA appeals and compliance.  This 2012 CNN Money report is consistent with an AMA report on March 4, 2011 that 51 percent of doctors in Texas are going broke: “51 percent of Texas doctors dug into personal funds to keep practices afloat in 2010,” Dr. Zhou said.

Writing in Forbes, Rick Ungar counters that “While there is considerable truth to be found in the CNN Money piece, a deeper analysis is in order given the knee-jerk reaction by the many who are too quick to place the problem and the blame at the feet of the federal government.  First off, it is important to recognize that not all physicians in the healthcare system are facing financial crisis. About 50 percent of the nation’s doctors are employed, typically by hospitals, and receive a salary in exchange for their service. So far, these practitioners do not appear to be in any significant financial danger.”

The financial problems are typically experienced by a portion of the remaining 50 percent who wish to operate their own private practices and, as a result, find themselves suffering from the financial stresses faced by so many small businesses in these difficult times.  Yet, even among this 50 percent, not all private practices areas are in trouble. For example, surgeons and dermatologists seem to be doing just fine while cardiologists and oncologists, whose business models necessarily make them more susceptible to trouble, are feeling the pain.

Why oncology and cardiology?

Part of the blame does rest with changes in Medicare and Medicaid payment policies. Certainly, cardiologists and oncologists, whose practices naturally bring them into contact with more senior citizens, are the most likely to feel the pain when it comes to reduced government payments. Last year, the Centers for Medicare & Medicaid Services (CMS) took a hatchet to what is paid to cardiologists for performing important tests such as echocardiograms, stress tests and other “machine” based testing. But what you may not know is that these reductions were based on a survey conducted by the American Medical Association, at the request of the CMS, that seemed to go out of its way to omit cardiologists in private practice from the survey participants. Why? Because private practice cardiologists have, by and large, dropped out of the AMA and the AMA’s interest was in getting more money set aside for those medical practitioners in other areas of medicine who remain members.

Physicians Working Longer Hours to Augment Compensation, Increase Patient Accessibility

Tuesday, May 26th, 2009

It’s not easy being a physician in these hard times.  Insurance reimbursements have been falling for some time, a situation that is unlikely to change for the better very soon.  Thanks to the recession and the growing number of people who are losing healthcare insurance along with their jobs, patient visits to physicians have leveled off and even

Maywood, IL-based Loyola University Health Center is taking a proactive approach to this dilemma by extending the hours its outpatient clinics in Chicago’s south and west suburbs are open for business.  Loyola’s move to increase patient accessibility is paying off.  In March, clinic visits rose 11 percent to 5,332 after 250 physicians opted to work longer hours.  Clinic visits are up an average of 1,100 each week.

“People really don’t want to leave their jobs and come to our offices (during their work hours)”, said Dr. Paul Whelton, chief executive of Loyola University Health System, parent of the medical center.  “Physicians are making themselves more available.  We need to be more user-friendly.  Our volumes are up and we are gaining market share.”  Some clinics even added Saturday hours for their patients’ convenience.

According to the American Academy of Family Physicians, Loyola’s extended clinic hours are part of a national trend.  Of members surveyed, 42.4 percent of physicians are providing extended office hours.