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It's Gonna Change

It's Gonna Change

I have the honor of being the medical director of an ERISA Health Plan that is negotiated between Kroger and the Union that represents Kroger store employees. I have held this position for about twenty years or more.

In 1992, the third party company who administers the Healthcare Benefits of Kroger asked UTMG to provide a medical director for them. The CEO of UTMG handpicked three physicians to interview with the CEO of the third party. After the interviews, the CEO of the third party told UTMG none of the physicians were a good fit. She wanted a young, vibrant person to help her shake things up a bit. I was new to UTMG and the CEO called me and asked me if I would be willing to work with their new client as their medical director. I agreed to interview with the CEO of the company because I served at the pleasure of the Dean of the Medical School.

The interview went well; I was hired for the job. I have enjoyed the opportunity. My role is simple. I review the healthcare activities of the Kroger store employees and determine if they meet the Plan's coverage for said services. The Plan is run extremely efficiently, with very low overhead for administrative costs. One great benefit of the job is that I review both inpatient and outpatient medical records. I have a bird's eye view of the physician activities of the medical community in Kroger's Delta Region. I see firsthand traditional occidental allopathic physician evaluations and diagnoses as well as popular prescriptive habits and laboratory ordering practices. I get insight on the current practice models that exist and what doctors charge for their services. I see the waste in the Healthcare system, the lack of attention to detail and the absence of compassion for patients in general.

One major change in the traditional practice model is the infiltration of the electronic medical record or EMR into the record keeping of medical offices and hospitals. Physicians are using EMR for a number of reasons, probably the biggest reason is the Federal requirements by Medicare. Private insurers such as Blue Cross/Blue Shield and Cigna like them also. The EMR is fraught with all kinds of potential liability. Most often, the routine patient visit, the one with physician-patient contact lasts less than seven minutes, is associated with an extensive and detailed medical record. The patient's subjective history of their medical illness or chief compliant recorded on the chart is most often derived from pull down boxes which restrict the actual history taking due to the finite number of choices a physician can access. If the physician presses normal for a section such as review of systems, the computer will generate a list of symptoms presumed denied by the patient, even though the doctor did not inquire as to the presence or absence of physiologic symptoms. The same holds true for the physical exam. Just because the EMR records are active, there is no guarantee that the examination was actually performed. The final diagnoses are usually generated by the computer, based on the boxes checked and clinical data gathered.

Some EMRs can prompt physicians to order more tests in an effort to up code the severity or complexity of the patient's complaint. The higher the complexity, the greater the fee for service. If a test is ordered and is actually unnecessary for the nature of the patient's complaint, but is necessary to up charge the patient or insurance company, some reviewers would consider that action as medical fraud. I see it as an unethical way to generate more revenue for the practice. This is a big problem with emergency physicians who see every case walking through their doors as a potential life or death situation. Patients can complain of a sore throat and end up with a bill of five thousand dollars or more due to the up coding of the patient's care. The hospital enjoys performing testing that has no relevance to the case; it generates revenue and if the hospital has an arm's length agreement with the physician ordering the tests, there is no collusion between the physician and the hospital administration to increase the complexity of the patient care and generate more revenue. The hospital is merely providing the testing for a physician who is seeking to prove that the patient is healthy enough to go home.

What baffles me is the lack of insight regarding insurance billing and compensation for services performed. If a physician is considered in a medical insurance's or hospital's network or a PPO, their fee for service bill is sent to a claims sanitizer who washes the claim and reduces the fee for service based on a percentage that the insurance company establishes. There is also a usual and customary fee that is a benchmark for the medical service provided. The usual and customary fee varies from region to region in the US. Sometimes the insurance reimbursement is based on usual and customary fees, not on a percentage of the physician's fee. The bottom line, the reimbursement is a fraction of the physician fee. Sometimes the patient co-pay is more money than the service fee recovered from the sanitizing process.

What is a better solution for physicians? Good physicians can opt out of insurance all together. That means that their patients would be seeing them as an out-of-network provider. Medical Insurance always has an out-of-network benefit and will reimburse a claim on a percentage of the bill based on their insurance policies. It's usually fifty or sixty percent of the physician charge. If one reviews data on physician reimbursement, it's clear that the out-of-network reimbursement is almost always greater than the sanitized compensation. If all physicians decided not be a member of a PPO, they would take a giant step in fixing the healthcare crisis from the provider perspective. The average deductible for most insured patients is roughly ten thousand dollars. Patients will do better finding physicians that suit their needs instead of going to physicians who are on their PPO but charge more for their services and delivering very little patient  care.

Last but not least, I have encouraged the third party administrator of Kroger's Health Plan to negotiate directly with physicians and hospitals, cutting out the middle-man (Insurance Companies). Doctors are now more receptive to seeking out the best deal for themselves and their patients, so are hospitals. I have been trying to get direct negotiations between the ERISA Plan and physicians for fifteen years. It's finally coming to fruition.

The old idea of companies directly negotiating with physicians is beginning to come around. Physicians should look past the healthcare chaos and seek their own answers related to reimbursement and fee-for-service practice models. Healthcare will change as a result of the providers and patients figuring out what is best for them, not as a result of legislation on a Federal level.

It's time for us to move the healthcare dinosaur. Leave the Fat Cats in Washington to work their own deals. They'll never have a solution and they may very well object to the creative solutions we, as a people, come up with. No matter: It's all gonna change.


Posted by Amanda Sanders at 11:27 AM
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