Responding to cuts in pay, thousands of American physicians are refusing to accept new Medicare patients. They claim that the reduced rates of pay fail to cover increasing operating costs. The refusal is dismal news because the federal program covers 40 million elderly and disabled Americans. That number is expected to double by 2030.
The 5.4% across-the-board rate reduction, in effect since Jan. 1, is part of a multi-year formula that critics say will result in a total fee decrease of 17% within 3 years. The reduction affects all Medicare services and more than a million health professionals.
The American Academy of Family Physicians says 17% of FPs are no longer accepting new Medicare patients because of the cutbacks. Dr. Baretta Casey, who practises in the small Appalachian town of Pikeville, Kentucky, says she is dipping into savings to subsidize her practice. If things don't change, “I probably can't stay in practice.”
Although most FPs have some Medicare patients, many try to keep the number to a minimum because rates generally are lower than those paid by insurers or HMOs. The growing reluctance to accept more patients is part of a double whammy for aging Americans — HMOs are also refusing Medicare business because they consider the payments inadequate. HMOs have eliminated 2.2 million Medicare patients in the past 4 years.
Some states will be hit particularly hard. For instance, 18% of Florida residents are covered by Medicare, and the American Medical Association predicts that it will become even harder to find a doctor there because MDs will see their annual Medicare payments drop by an average of $6260. The medical director of a clinic in Washington state reported that Medicare pays his group an average of $60 for an office visit, but actual costs average $100 once rent, staff salaries, malpractice insurance and other expenses are covered. — Milan Korcok, Florida