What Were They Thinking?

A few weeks ago, physicians were once again faced with the possibility of Medicare Cuts based on the Sustainable Growth Rate (SGR) - that was adopted in the Balanced Budget Act of 1997. Since the SGR went into effect, each year physicians are threatened with a pay cut from Uncle Sam. This time it is close to 30% for year 2012.

However, now we have the Debt Deal, which changes the game AGAIN. In the past years, Congress has either let the cuts go into effect and then rescinded them after the New Year or simply stalled the cuts for days, weeks, months, or the next year, without fixing the policy that determines how physicians are paid. But now the government has decided that it is best to penalize physicians:

“The White House has made it a selling point that the deal protects Medicare beneficiaries — and that any cuts would be limited to providers. But they haven’t talked about the consequences if doctors have their payments cut — like the possibility that more of them would stop seeing Medicare patients.”

There are so many things wrong here, where to begin:

Reality One: People are living longer, into their late 70’s and early 80’s. With Medicare enrollment at age 65, a person could conceivable be on Medicare for 20 years.

Reality Two: The majority of healthcare spending is at the end of life.

Reality Three: Payments to physicians have not changed significantly for over a decade. That includes all payments from all insurance companies, not only Medicare, because commercial insurance companies base their payments to physicians from the Medicare Fee Schedule.

Reality Four: America is facing a physician shortage.

My own practice is booked out for new patients 8 weeks and it usually takes an established patient at least two weeks to get in to be seen. We have increased our hours to accommodate more patients; however, the demand is greater than the supply. In a normal capitalist business, a greater demand would drive up prices, and profits, which would entice more people to get into that business, thus alleviating the demand and meeting the needs of the people. However, the government regulates how much physicians are paid through the Medicare Fee Schedule

Let’s review the purpose of Medicare: To provide Healthcare Insurance for the elderly so that they can continue to have access to healthcare professionals after they retire and, in theory, lose their employment based Healthcare Insurance. However, it that Insurance has determined that it will cut what it pays to physicians, then physicians will not be available to service the population that Medicare professes to want to help.

Reality Five: By sparing beneficiaries the reality of the cost of healthcare, the government is also sparing them the ability to see physicians, because physicians will close their doors to Medicare Patients.

In conclusion: The government cannot balance the budget on the backs of our physicians.