In 2002 less than five physicians in Texas stopped participating in Medicare, mainly because of the reimbursement rates. In 2010 it looks like the number of doctors dropping out will be around 200. https://higginscompanies.com/faq/group-health-insurance-faq%e2%80%99s/
It used to be that when a doctor submitted charges of $1000 to Medicare, about $400 of it was profit after taking out expenses. Not a bad day in any one’s book, especially with a full waiting room. If and when the nearly 21% cut in Medicare reimbursement is actually implemented June 1st., the profit amount will be around $83. Not a good day in any one’s book.
There is a business term that many in America are not familiar with, but will be, when the health insurance law is fully implemented, and that is, “defensive business arrangements.” In laymen terms this means, “you don’t get to keep your doctor if you like.” Well, not true. You could keep your doctor of choice, you will just need to keep him or her under lock and key in the basement because that’s the only way you are going to be able to see them.
Thanks to ObamaCare insurance companies must cap the amount of money they spend on overhead to 15% for large groups and 20% for the individual and family market. To accomplish this health insurance companies will need to cut the cost of their products by paying hospitals and doctors less, and cutting services covered like costly MRI’s as an example. But to do this health insurance companies are working very hard to buy up as many clinics and doctor’s practices as possible so that they may have the control they need over these expenses. If the health insurance company can’t own the doctors outright they will cut back on the size of their network which means less choice for the insured. Doctors are selling their practices at an alarming rate, mostly to hospitals. Half the jobs for doctors are offered by hospitals today. A few years ago it was a quarter of all jobs.
The end results of all of this consolidation will be larger government and fewer choices for the public. They will get to pay higher premiums though, much higher.
What is most concerning, other than the incredibly large number of doctors leaving Medicare, is what will happen when ObamaCare starts in 2014. The number of physicians already thinking about leaving the profession is at an all-time high, and worse yet there is a shortage of primary care physicians today.
Michael Higgins
An Arizona health insurance broker.
602.405.8769