Part 2 of the ACA Series: The new unpleasant face of primary care.

The increased regulatory burdens placed on primary care practices by HIPAA, the ACA, Medicare regulation/reforms, meaningful use, and novel modes of care (e.g., medical homes, ACO’s, chronic care notes, ect.) have pushed many doctors out of traditional primary care arrangements and into affiliations with hospitals. I am part of a 5 provider practice (2 doctors, 3 nurse practitioners) that is autonomous and has sufficiently reduced overhead to allow us to have small patient panels and half hour visits without having to charge patients fees. But our practice (and many like ours) is under stress from the very reforms that are purported to be improving medical care. Being audited twice since April, faced with ICD-10 implementation, cuts in Medicare reimbursement, HIPPA and EMR requirements, and the jungle of regulatory minutia are impossible for us to decipher and cope with, we are struggling and stressed. We have had to hire a full time staff member to contend with implementation and compliance with new Medicare/ACA programs. We have had to dramatically increase our IT expenses. We have had to buy insurance to protect us against the often onerous audit penalties. These costs are barely sustainable. One official high in the ranks of CMS told me that practices such as mine will be extinct in 5 years. In our place will be hospital and organization run practices, concierge practices, and practices that no longer accept Medicare. We have discussed seriously selling our practice to a hospital and relinquishing control, with the tradeoff being that someone else would keep us in compliance with the avalanche of reforms that are suffocating us. For the moment, we are able to keep our heads above water and maintain our relationship-based model of care. But none of us are confident of our long term survival prospects.

A Forbes article from 2013 by Scott Gottlieb (“Hospitals are going on a doctor buying binge, and it is likely to end badly”) outlines some of the dangers of the transforming primary care landscape. The ACO increases the cost of running an office practice, pushing doctors to fall prey to the allure of joining a hospital. This is especially true for specialists and many primary care doctors, who are paid more to provide certain services and even office visits when they are part of a hospital than when they are in independent practice, something we will discuss more below. Further, under ACO programs, the article argues, hospitals “want to consolidate local physicians to secure monopoly-like positions that give them bargaining power. Studies show that this sort of market consolidation leads to higher healthcare costs.” Hospitals bought up practices in the 1990’s, but then relinquished them when the economics of the arrangement proved unsustainable. Physician productivity decreased, and hospitals actually lost money. According to Gottlieb, if the economics prove difficult again, doctors will have a much more difficult time pulling out of the arrangement given the difficulty of surviving in the ACO environment on their own. Doctors will be forced to see more patients under onerous productivity requirements, will be straddled by rules and restrictions, and will be less able to actually have relationships with patients. Concludes the article: “The doctors will get squeezed but the real misfortune will befall patients. We will increasingly be getting our medical care out of busy, hospital-run clinics. Our doctors will be salaried employees, more beholden to the rules that hospital erect to manage their activities than the medical practices that they once owned.”

How quickly is this trend occurring? Between 2001 and 2011 the number of doctors employed by hospitals grew by 40%. In some communities 70% of doctors are hospital employed. (Greenville News, 9/4/13) As mentioned, one reason that doctors are purchasing doctor’s office is that procedures and visits are paid higher rates in the hospital than in an office. For instance, certain office visits are paid 80% more by Medicare if the doctor is hospital based, and procedure payments for tests such as echocardiograms more than double ($189 vs $453) for hospital based doctors. Now, according to the New York Times (2/6/15) the Obama Administration hopes to change this inequity and reduce the payments to hospital doctors so that they are identical to what doctors are paid in community practices. This would save Medicare $30 billion over ten years and allow the “doc fix” to become permanent. But of course, the idea is being resisted by many hospital and physician groups. Bottom line: if the change does occur, hospitals will be forced to relinquish the lost income by some other means, and likely Gottlieb’s tocsin will be realized: doctors would have to see more patients more quickly and become slaves to rules and productivity requirements. Patients will have to contend with rapid visits with stressed doctors who are typing into computers and not providing care that satisfies either the doctor or patient. Under such conditions, doctors typically order more tests, refer to more specialists, and prescribe more medicines, as they have little time to discuss issues with patients or think too much about the implications of over-testing and over-treatment. Costs of care will explode as quality, satisfaction, and outcomes plummet.

The alternative left to primary care doctors who try to resist joining hospital practices and maintain autonomy over their practices is to drop out of Medicare entirely. Some doctors simply have stopped accepting Medicare payments, and others have opened concierge practices. The latter is a very interesting concept that is taking hold of many in the primary care realm. In charging patients an annual fee (from $800-$2000 depending on the doctor and the plan), and no longer accepting insurance payments, primary care doctors are not beholden to any ACA rules or regulations, they do not have to type in templated notes or be forced to comply with quality indicators and other counter-productive top-down protocols, they can afford to have longer visits with patients, and they will in essence maintain the doctor-patient relationship that most doctors and patients covet. Such a system is not affordable for every patient, but for those who pay lower premiums because they have high-deductible plans, joining concierge practices makes great sense. Medicare does not allow this arrangement. But studies show that when primary care doctors spend more time getting to know and being able to discuss issues with their patients, satisfaction and quality of care escalate, and the cost of care drops. What Medicare is doing now, by pushing doctors into hospital-owned arrangements, will trigger just the opposite outcome: cost will increase as quality and satisfaction drop. This is one casualty of the ACA’s quality and value crusade, punctuated by a payment system that makes no logical sense. Unless we prevent the extinction of primary care office practices now, and we put pressure on Congress to make the landscape more amenable to primary care physicians who seek to spend more time with their patients without the burdens of excessive regulations and fines, then the face of primary care will be unpalatable to most doctors and their patients, as the cost of medical care increases with worse outcomes.

Of course, if a concierge low-patient-load model of care does gain a foothold, there will not be enough primary care doctors to take care of everyone, especially those who need primary care services the most: those who have Medicare. Still, such a change would make primary care a more palatable option for doctors, and likely students would be quicker to join the primary care ranks, something absolutely not the case today. We do need to incent students to enter primary care, and the current landscape and fee schedule is accomplishing just the opposite. Pushing all primary care doctors into hospital based clinics will only exacerbate that reality. Again, positive change is easy to accomplish even without a concierge model, as I discuss in my book. We just have to acknowledge the problems and propose common sense solutions.

In our next blog we will examine how the ACA’s new emphasis on population health and value is not only unsustainable, but is likely to accomplish just the opposite of its stated goals.