I work with physicians on the job market, looking for the opportunity that will help them achieve their practice goals, and with hospitals and private practices that are looking for an outstanding provider who will be a good match for the opportunity and serve the community well for years to come. Without going into the politics of healthcare reform and philosophical differences in how to improve access to care, here are some thoughts on the physician job market will adjust.
- Independent, private practices will be largely unsustainable in the regulatory environment of Accountable Care and will become a thing of the past. But on the plus side, hospital ownership of a practice eliminates many of the headaches of private practice. Billing is done at the corporate level, staffing is often linked to a “float pool” of workers who can fill in if the front desk person is sick suddenly, a better line of communication with the hospital services and records, etc.
- Primary Care becomes a hot commodity. Guarantee salary situations and other improved compensation features will follow. It’s the law of Supply and Demand.
- Joining Patient-Centered Medical Homes (PCMH) and Accountable Care Organizations (ACOs) will mean working in a more collaborative, better staffed practice, as particular standards of care and levels of staffing are dictated.
- Medicaid expansion–those states that implement it–will require cutbacks somewhere to pay for the additional enrollees. Prepare for across-the-board reimbursement cuts over time in those states that expand coverage.
- Any administrator who has implemented a large-scale EMR project (as we did with Epic in 2003 at NorthShore University HealthSystem) knows that large-scale change tips the scale towards attrition for a small number of physicians on the cusp of retirement. Nearly every community in the county (except New York City) already needs physicians, but additional (perhaps inevitable) loss of practicing physicians creates greater demand and broader varieties of practice opportunities and settings to choose from.
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I’m an English major and a Healthcare Geek. I could go on for 2500 words with this topic. But in this case, a (non-healthcare) friend asked my opinion on the topic on my Facebook timeline. Wishing to spare my grandmother this diatribe, I present it here.
As I have admitted in earlier posts IANAE (I am not an Economist), but there are a few significant ways in which insurance has influenced price:
- Moral Hazard–This is a fancy term that means, “Any system that allows consumers to spend other people’s money on their consumption is inherently going to have rising costs. During the year, you pay the agreed-upon copays to visit the physician as many times as you’d like–any time you get a little sniffle, if you so choose. Your premiums may rise next year to account for so many people in the patient pool having utilized the system the previous year, but for each episode of care, you didn’t feel the full bill.
- Healthcare is not a truly competitive market–At the consumer level, patients have no idea what a service costs before they purchase the services of a provider or hospital, so they can’t comparison shop. That could all change in 2014–the Affordable Care Act requires all hospitals to publish their prices for common services by 2014.
- “But what does the patient care about prices if they have insurance? You just said they were shielded from prices.” Yeah, publishing prices so that we know that the appendectomy at Hospital A is $1000 cheaper than at Hospital B for the insurance company doesn’t really matter. But what if that price difference was passed on to the patient? Sometimes it is. Let’s say your appendix is causing you severe pain and so you’re looking for the closest hospital, which happens to be Hospital B. They get you into surgery a few hours after you arrive at the ER (after tests and diagnostics and a good dose of pain killers), and a few weeks later you get the bills. Bills? But I have insurance!!! Yes, but you chose Hospital B, which is Out of Network with your insurance plan. They have a special pricing contract with Hospital A, based upon negotiated charges (see previous blog entry). If you had gone to Hospital A, it wouldn’t have cost much more than the various agreed-upon copays for the ER and diagnostic imaging.
- Health insurance is highly-regulated–Each state regulates insurance companies for its citizens. State-by-state benefit mandates necessarily determine the cost of premiums–if your insurance has to provide coverage for a wider range of services, it will cost. This issue isn’t truly caused by insurance, per se, but facilitated by its existence. There are over 1,000 mandated coverage laws in the United States today, ranging from mandatory coverage of kidney transplants in Illinois and Heart transplants in Georgia to marriage counseling in California and hair pieces for the bald in Wisconsin.
These are a few of the most insidious ways insurance companies have influenced healthcare prices. Certainly the biggest culprit in my mind is the shielding of cost from the consumer. Some studies suggest that Health Savings Accounts (HSAs) reduce the cost of care by making a patient more sensitive to when they seek care and where they go for treatment (i.e. “Do you go to the physician and ask for antibiotics at the first sign of a sniffle?” “Do you ask for the price of that appendectomy up front?”).
The recently-upheld PPACA, however, may soon eliminate HSAs–now used by more than 11 million people for 100% coverage of preventive care and a deductible of roughly $4,000-6,000 per family for everything else. The law puts guidelines for health plans to meet certain actuarial standards of coverage. HSAs were created to be low-cost, high-deductible options, and in order to meet those standards, they may have to add benefits and, consequently, raise premiums. An exception for HSAs wasn’t written into the law, nor were HSAs considered as option in the current reform law.
But I digress. And I promised that I’d keep my answer shorter than a Faulkner novel.