Money and Medicine

OK,
I guess it's finally time to tackle the difficult issue of finances, and why we don't participate with insurance plans. One simple fact to keep in mind is that our patients come from all over the world and it would be impossible to review and sign all the contracts that various insurance plans might require, since that would be several dozen new insurance plans every few months. But that's not the real reason we don't participate with insurance plans.

First, I'll try to explain how insurance companies deal with physicians. This may not apply to all insurers, but it is how the ones I've dealt with operate. These days, most health plans are either PPOs (Preferred Provider Organizations) or HMOs (Health Maintenance Organizations).
Doctors have a choice whether or not to participate with a particular health plan.

Participating means that the doctor signs a contract agreeing to accept whatever the insurance company wants to pay the doctor without the doctor being able to bill the patient for the remainder of the fee. The upside for the doc that participates with insurance companies is that they theoretically would see more patients, so the increase in volume makes up for the decrease in reimbursement. However, this inevitably leads to the common complaint that doctors are seeing too many patients and not spending enough time with any of them.

Not participating means that the doctor doesn't accept what the insurance company wants to pay the doctor. Non-participating doctors usually see fewer patients as a rule because patients are steered toward participating doctors who have lower fees imposed on them by insurance companies, and who cost the patient less out of pocket. Unless the non-participating medical practice offers something special (like specialized surgical expertise or the new "boutique" practices guaranteeing 24 hr service and house calls), non-participating can be ruinous financially because few patients might show up at the door.

Every insurance plan (even various plans offered by the same insurance company) is different in what they will pay for any given service, but they are usually somehow tied to Medicare reimbursement rates, even though not all patients are over age 65. For an office visit, they pay a certain amount and never more. For office procedures (like an endometrial biopsy or colposcopy - looking at the cervix to find precancerous areas) there are fixed payments, likewise for surgeries. Regarding surgical reimbursement, it gets more complicated because now there's an insurance payment technique called bundling. Bundling means that if you do 3 different procedures at the same time (ie excision of endo, remove an ovarian cyst, and free up a bunch of adhesions) the insurance company would only pay for one at full price, and the rest are paid at 1/2 or 1/4 of the originally agreed upon already discounted rate. Then, on top of that, there are procedures that are considered part of another procedure, so they can't be billed for at all (like looking in the bladder- cystoscopy- after doing a sling or bladder suspension). All surgeries have codes, and the payment is based on the code, not how difficult the surgery was or how long it took. What this means for us is that excision of endo has a code. When we do an excision surgery, whether it takes 30 minutes or 3 hours the insurance reimbursement is the same. Whether Dr. Redwine (who has done 3000 cases of endo) does it , or Dr. Joe Schmoe in Hickville (who might have done 30) does it, reimbursement is the same. Plus, whether it was excised (removed) or ablated by laser or electrocautery (ineffective for treating most endometriosis but much easier and faster) you guessed it - reimbursement is the same. So, insurance companies are not impressed by efficacy of therapy or the experience of those performing the surgery. They may give lipservice to "quality indicators" and track how many patients received antibiotics before surgery (even though in many cases antibiotics don't change outcomes) and other meaningless indicators, but regarding the ultimate outcome of surgery (whether or not pain relief is achieved, how many subsequent surgeries are required, how effectively the disease has been removed from the body), insurance companies could care less. They are interested only in how little they can get away with paying a surgeon for a procedure. They have learned that if they don't pay a surgeon for a procedure, then the surgeon will not schedule the surgery in the first place, so the insurance company gets to keep even more money.

There are other problems caused by this situation that affect patients just as much as physicians. HMO reimbursements are typically lower than those of PPOs, plus HMO plans are much more restrictive about what procedures can be done for patients. They may require prior authorization before approving ultrasounds, CT scans, MRIs, surgeries, and sometimes even referrals to other physicians. Docs are limited with regard to which doctors, physical therapists, etc. they can refer patients to. They are also typically rewarded on an annual basis for saving money (translation - using fewer resources). The idea of this was originally to entice docs to keep their patients healthier by keeping their blood pressure, diabetes, and other chronic illnesses under control, because healthier patients use less resources than those that are sick (out of control diabetics, strokes from uncontrolled high blood pressure). The original idea is noble, but instead it has resulted in some (not all, hopefully not even many, but some) docs doing fewer investigations into issues like pain, issues that are probably not life threatening, but definitely impact on quality of life. Some of these problems can be difficult to diagnose and manage, so if they were pursued, they would use a fair amount of resources. By ignoring them, the less than honorable primary care provider uses less resources, has less "bother", and gets a bigger rebate at the end of the year: they are paid more for withholding care.
There's another problem that's significant - the contracted reimbursement rates can be changed by the insurer, but not by the docs. There are no "cost of living" increases. When congress decides to drop medicare reimbursement rates, since many private insurers follow medicare, there's a chance that reimbursements will decrease as well. Since doctors can't or won't unionize (the ethics of this are debatable and we won't go into that now), there's no way to have "collective bargaining" and as a group negotiate a contract with the insurer that's fair for both parties. Physicians and other health care professionals are the only group that doesn't have control over what they get paid for professional services. When the law firm down the street has increases in its expenses, they raise their rates accordingly. When Matson (the big shipping line that ships most everything that gets to Hawaii) has to pay more for fuel and more for the stevedores that unload the ships, shipping rates go up. This is not surprising to anyone. What might be surprising is that from the time I arrived in Hawaii (1998) to when I left (2006), the amount we were paid by HMSA (the Hawaiian insurer that covered 80% of our patients) for certain office procedures actually went down, as did rates for some surgeries. During this time, my malpractice costs doubled, not because of any claims, but because of the national "environment" of a general increase in claims and awards. That's another story, too.
This whole situation has caused most doctors to see more patients in order to keep the same level of reimbursement, all the while enduring increases in expenses such as malpractice coverage, staff salaries, rent, utilities, and just about everything else. When reimbursements fall and expenses rise, doctors offices and usually the docs themselves take the hit. Because of this, many docs are leaving areas of high expense and low reimbursement such as Hawaii. They can move to the midwest where expenses are low and reimbursements are higher, and have a result of a net doubling of their income. I have friends who are pediatricians who are making less money than the guys with a high school education who are unloading the ships (the stevedores). Factor in the time and money it costs to go to medical school, plus making minimum wage for 3-6 years during residency, and it's no wonder that applications to med school have been down for quite a while. Applicants are less qualified than they used to be, and as a result, the brightest and best of our young people are pursuing other fields leaving the OK but not stellar to be the doctors of the future. This should be concerning to everybody who plans on living past the next 15-20 years. But I digress....
Our situation is that our surgeries sometimes take an hour, sometimes 8 hours. The surgeries that we do do not fit into the mold that insurance companies have cast. Laser vaporization or electrocoagulation may take 15 minutes to an hour to perform because they are such simple procedures. Our techniques are much more tedious, aggressive, and risky; to be done well they require specialized training and expertise that only a few surgeons in this country possess. Our techniques are worth far more than the insurance company will pay because they do what all the previous medicines and surgeries have not done: remove the disease from the body. Most of our patients have tortuously endured several years of surgeries and therapies, consuming tens or hundreds of thousands of dollars, yet our surgical fees are a fraction of what's been spent for their past therapies. We are in a unique position to judge what our talents are worth, and insurance companies are not. Insurance companies would rather pay a surgeon a small amount of money several times than a larger amount to get the job done right the first time.

I hope this serves to shed some light on the situation that doctors are in these days, and why we have the policies that we do. Our intent is to receive a reasonable fee for a specialized, difficult surgery that few surgeons can perform. It also allows us to spend as much time with each patient as they need in order to answer all their questions, explain their disease to them, fully counsel them about their upcoming surgery so that they understand all the risks, benefits, and alternatives, and sustain the real meaning of the doctor-patient relationship- trust and confidence. This is a benefit all our patients appreciate and many people wish they had with their doctors. We do bill the patient's insurance company, but since we do not participate, the insurer sends the check to the patient rather than to us. As surgery is not something one can take back, we would have no recourse (other than through the legal system) if some unscrupulous patient kept the insurance money rather than using that to pay us: this is why we require a deposit up front. Most people place this on their credit card and by the time the bill comes, they have the reimbursement from the insurance company for a portion (and in some cases the majority) of the bill. While our fees are set, if you need surgery for removal of endometriosis, we will try to work with you to come up with a solution that is mutually satisfactory.
In conclusion (finally...) I am doing record reviews without charge for the immediate future, so if you have issues with endometriosis that is impeding your ability to have a healthy happy active life, let me see if we can help you out.
Have a great week, and take care.
Dr. Mos