Ronda Kotelchuck
New Study Finds All Primary Care Providers Initially Lose Money on Every Patient Visit
A new study released on Friday by the Primary Care Development Corporation and RSM McGladrey found one of the more disturbing facts to come out of the primary care debate in some time. Although we have known for years that primary care providers have been struggling just to break even, for the first time we were able to quantify data that showed that all primary care providers in New York City lose money on every patient visit, leaving them to scramble to make up for the reimbursement shortfalls.
The initial losses vary depending on the type of provider, but our data shows that the losses range from a low of $28 to as much as $226 per patient visit on primary care delivery.
For those of you who are wondering how these providers keep their doors open with these enormous losses, primary care provides are forced every year to try to “plug the holes” through every public and private grant or subsidy they can find. By itself, the demanding bookkeeping effort necessary to chase down these funds, in addition to the tangled web of paperwork that varies from provider to provider and even from patient to patient, create a huge administrative burden on providers and distracts from patient care.
For decades, experts in primary care and the healthcare industry have known that the reimbursement system for primary care providers was absurd. But for the first time, this study has enabled us to see the precise absurdity of the system in clear and quantifiable terms.
For an example of the irrational nature of our system, payors (such as Medicaid or commercial insurers) reimburse primary care providers differently for the same exact services. This means that even though providing a physical for a patient will probably cost any given provider around $200, the provider could be reimbursed $125 by Medicaid but only $65 by a commercial insurer.
That’s not all. Let’s say the patients were getting their physical at a hospital’s primary care center. These patients could walk across the street to a community health center and get the exact same physical, but the health center would be reimbursed a different amount by the payors merely because the patients were in a different building.
If this is confusing to you, imagine the frustration primary care providers feel every day when they are forced to navigate the labyrinths of our primary care reimbursement system.
Fortunately, there is a way out of this. In a future post, I will discuss what we found to be the best reforms possible to solve this crisis in primary care.
To read the executive summary or the entire report, go to http://www.pcdcny.org/resources/ReimbursementReport.htm.
Ronda Kotelchuck: Author Bio | Other Posts
Posted at 1:00 PM, Dec 10, 2007 in Health Care
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Comments
After exhibiting at the recent SIMPD (Society for Innovative Medical Practice Design) conference in Washington D.C. we have found that many physicians are frustrated with current state of primary care. As of Jan. 1st Medicare will be cut another 10%. Where does this leave physicians that are already on roller skates with their patients? What will happen to these physicians when they cannot afford their overhead? Or worse, hinder the quality of their care from their exhaustion of seeing 40-55 patients a day.
With not many positive options for PCP's we are proud to be an educator and facilitator for the movement of "retainer" or "concierge" practice models.
ModernMed is a forward-thinking health care service firm designed to create a better primary health care experience for patients, physicians, and businesses.
Unlike the competition's models, we offer two extremely flexible practice solutions for the physician. While working with the physician to design the new practice ModernMed can assist in pre-conversion, during conversion, and post-conversion processes. Please visit our website for more information: www.ModernMed.com
Posted by: ModernMed | December 19, 2007 05:08 PM
We know very well what happens as purchasers and payers devalue primary care because we see it happening before our eyes. Practicing physicians retire or give up their practices, communities cannot recruit and face a growing physician shortage and the pipeline of new physicians entering primary care dries up. You’ve put your finger on the crisis that is gaining more and more attention.
I’m delighted to hear of the solutions you have crafted because we know that good primary care works. My only question is, can “retainer” or “concierge” practices be designed to serve all patients, including those who are low income (Medicaid, uninsured or heavy co-pays and deductibles)?
Posted by: Ronda Kotelchuck | January 5, 2008 02:05 PM
We certainly believe that direct care practices can be designed to serve all patients, but certain changes in practice and benefit structure need to occur to enable the model to work.
For patients with chronic conditions, this model works well. The retainer fee usually does not change depending on individual patient case. They see their physician regularly and are essentially healthier and more proactive to their existing condition deceasing their severe medical issues, (which are the cause of high health plans initially).
With trying to coax these changes we recommend that our physicians offer a generous percentage of their existing panel to scholarship patients that may not have the resources to switch to the modern practice.
All in all this does not solve the Primary Care dilemma, but we are trying to improve the general experience by offering options to change.
Posted by: ModernMed | January 8, 2008 01:26 PM
Well! I am an obssessed blogger. I don't see blogs as funny thing. I see blogsphere a platform to exchange knowledge and expertise....
Posted by: Concierge | July 23, 2008 12:33 AM