This is alarming.
Already, private-practice physicians are stretched to the limit, having to deal with government rules and regulations and the mountains of bureaucratic red-tape paperwork. Now comes news that many doctors are literally going broke.
Parija Kavilanz reports for CNNMoney, January 5, 2012, that half of all doctors in America operate a private practice. But it is precisely private-practice, that is independent, doctors nationwide — including family physicians, cardiologists and oncologists — who are going broke. The reasons? — shrinking insurance reimbursements, changing regulations, and rising business and drug costs.
One of them is Dr. William Pentz, 47, a cardiologist with a Philadelphia private practice. Recent steep 35% to 40% cuts in Medicare reimbursements for key cardiovascular services, such as stress tests and echocardiograms, have taken a substantial toll on revenue. So Dr. Pentz and his partners had to tap into their personal assets to make payroll for employees last year. But he said:
“We still barely made payroll last paycheck. Many of us are also skimping on our own pay. Our total revenue was down about 9% last year compared to 2010. These [Medicare] cuts have destabilized private cardiology practices. A third of our patients are on Medicare. So these Medicare cuts are by far the biggest factor. Private insurers follow Medicare rates. So those reimbursements are going down as well. If this continues, I might seriously consider leaving medicine. I can’t keep working this way. [If the impending 27.4% Medicare pay cut for doctors goes through], it will put us under.”
Federal law requires that Medicare reimbursement rates be adjusted annually based on a formula tied to the health of the economy. That law says rates should be cut every year to keep Medicare financially sound. Although Congress has blocked those cuts from happening 13 times over the past decade, most recently on Dec. 23 with a two-month temporary “patch,” this dilemma continues to haunt doctors every year.
Beau Donegan, senior executive with a hospital cancer center in Newport Beach, Calif., is well aware of physicians’ financial woes. She said, “Many are too proud to admit that they are on the verge of bankruptcy. 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.”
Dr. Neil Barth is an oncologist in the top 10% of oncologists in his region, according to U.S. News Top Doctors’ ranking. But he hasn’t taken a salary from his private practice in over a year. He owes drug companies $1.6 million, which he wasn’t reimbursed for. He is contemplating personal bankruptcy and closing his 31-year-old practice in the next 6 months, forcing 6,000 cancer patients to look for a new doctor. Until then, he’s turning away new patients whose care he can no longer subsidize.
Changes in drug reimbursements have hurt him badly. Until the mid-2000′s, drugs sales were big profit generators for oncologists who would buy expensive cancer drugs at bulk prices from drugmakers and then sell them at much higher prices to their patients. But in 2005, Medicare revised the reimbursement guidelines for cancer drugs, which effectively made reimbursements for many expensive cancer drugs fall to less than the actual cost of the drugs.
Still, Barth continued to push ahead with innovative research, treating patients with cutting-edge expensive therapies, accepting patients who were underinsured only to realize later that insurers would not pay him back for much of his care. “I was $3.2 million in debt by mid 2010,” said Barth. “It was a sickening feeling. I could no longer care for patients with catastrophic illnesses without scrutinizing every penny first.”
Read the rest of the article here.
I can see the black hand of Creeping Socialism in this, can’t you? Doctors in private practice are expected to absorb rising drug costs while their reimbursements from Medicare and private insurance companies keep shrinking. The doctors go broke. And so, the private-owned medical practices shrink while the government sector enlarges. All of which plays to the advantage of Obamacare and its eventual goal — the transformation of America’s health care system into a massive “
single-payer” government health care.
Meanwhile, documents released in a classic Friday afternoon news dump show that, since June 17, 2011, labor unions representing 543,812 workers received waivers from Obamacare.
All of which raises this question: