Surprises For Physicians Coming With In Health Insurance Exchanges

Stanley Feld M.D.,FACP, MACE

 Two important components of Obamacare are Accountable Care Organizations (ACOs) and Health Insurance Exchanges (HIEs).

The adoption of both by medical communities and the states has been slow for good reason.

I have discussed the difficulties of setting up and the executing effective Accountable Care Organizations.

Some hospital systems are trying to set up ACO’s. These hospital systems are buying up physicians’ practices and trying to develop integrated care organizations.

The hospital systems are buying the physicians’ intellectual property and surgical skills sets. It will not work once physicians realize what happened.

The relationship between community hospital systems and practicing physicians had always been tense. Physicians do not trust hospitals and hospitals do not trust physicians.

Some physician groups are trying to develop their own ACOs. They are trying to convert hospital systems from being providers of patient care to vendors for their physician ACO.

If there are two hospitals in a community or town the hospital systems might become competitive.

The huge problem for physicians is the assuming of risk. If healthcare insurance companies cannot manage risk, why would physicians think they can manage risk?

 A variable that cannot be controlled in managing risk are patients. With all the obesity and the increase in diabetes mellitus it seems patients do not have the incentives to manage their own risks.

 Patients and physicians must be provided with appropriate financial incentives if there is the slightest chance of managing risk and decreasing the cost of healthcare.

 The adoption of ACOs has been slower than the Obama administration has anticipated.   

 Adoption of the Health Insurance Exchanges has been slow by states. Some states recognize the financial risk the Obama administration is trying to force on them.

This risk is ever present even if the federal government is going to pay the entire bill for the first three years.

As soon as physicians realize the risk the Health Insurance Exchanges are going to impose on them, they will not be willing participate.

These risks become more apparent will each succeeding release of regulation.

Kathleen Sebelius said it two weeks ago when she said there would be plenty of surprises ahead for physicians.

“Health and Human Services Secretary Kathleen Sebelius, who told a gathering a few weeks ago at the Harvard School of Public Health that she has been "surprised" by the political wrangling caused so far by Obamacare, there are likely to be plenty of surprises ahead.”

Physicians could face dramatic financial challenges for treating patients who receive health coverage through the Affordable Care Act's (ACA) Health Insurance Exchanges starting next year.

“ Insurance companies will not process claims on patients who haven't paid their premiums in 3 months, leaving doctors on the hook to recoup payment directly from the patients.”

Obamacare provides a 3-month grace period to individuals who haven't paid their premiums for insurance purchased through the Health Insurance Exchanges.

This provision will prove to be a problem for physicians.

In Obamacare patients who fail to pay their premium are free to sign up for another plan provided by the Health Insurance Exchange.  

They can also start seeing another physician without the insurance company or new physicians being aware of the patient’s delinquent premium record.

"Why would a doctor sign up to treat these patients] if they're going to be completely at risk and have to collect from the patient directly for their care?"  "This is a really bad provision in the bill, and we've got to get it fixed."

Under traditional insurance provided by employers, the plan is still liable for paying doctors even if the patient or employer hasn't paid their premiums,

Under the health insurance exchange the individual is responsible for their monthly premium. If the patients discontinue payment of their premium the healthcare insurer is not obligated to pay the physician for the care provided.

Most of the time patients have stopped paying premiums because they cannot afford them. Patients buying healthcare insurance from the Health Insurance Exchanges are lower income producing patients. 

 The expected annual, out-of-pocket cost for an individual is estimated to be around $6,400 and $12,800 for a family. This is not an insignificant expense for low wage earners.

Recent premium estimates indicate that the premium will be higher. This could be one of the surprises Kathleen Sibelius is referring to.

Another potential shortcoming of the Health Insurance Exchange is the reimbursement rates provided to physicians. The Obama administration believes Medicaid rates are sufficient.

I wonder if any of President Obama’s healthcare policy wonks ever questioned why so many physicians do not accept Medicaid.

The answer is simple. The reimbursement rate is less than the physicians fixed overhead to see the patient.

Medicaid physicians are driven to see many patients a day to try to make a living.

It would be difficult maintaining a physician patient relationship and a high quality of care seeing over 100 patients a day.

When their overproduction is discovered these physicians are investigated for fraudulent practices.

 The rates the healthcare insurance industry will pay physicians will not be set until late summer.

The big provider groups are negotiating with plans on their payments. Small groups will only get a "take it or leave it" contract from the health plans.

It seems obvious that fewer physicians will sign up to accept patients receiving coverage through the Health Insurance Exchanges once physicians understand what Obamacare is doing.

 This will result in a further physician shortage.

 The simple question is what is Obamacare trying to do to the healthcare system?

 Is Obamacare trying to destroy the healthcare system?

 The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

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