One of the duties of the President of the Missouri State Medical Association is to visit component societies around the state, and to reach out to physician members of MSMA through other meeting opportunities, including hospital medical staffs, Independent Practice Associations (IPAs), and medical specialty society meetings.
This past year I have had the privilege to attend many meetings throughout the state and visit with many different practice environments in rural, suburban, and metropolitan settings. The one common theme I hear is physicians’ concerns on the future of medicine in the state of Missouri as well around the nation.
Health care legislation known as the Patient Protection and Affordable Care Act (PPACA) has resulted in broad changes to medicine on a national basis. While most physicians support the insurance changes contained in the law, most are skeptical that additional government regulation will achieve a better quality health care system. They doubt that it can improve access without rationing, not to mention finance the inclusion of 30–50 million additional patients into the system without breaking the bank.
As I travel throughout Missouri, I am pleased to find physicians are interested, active participants at their local levels; all are interested in improving health care not only for their own community but for the broader community of people of Missouri. Most physicians, however, often feel their situation is unique and that their community solution is somehow different from other parts of the state. That is incorrect! Most issues that affect rural communities are also important factors in most metropolitan regions of the state. While each area may have different priorities, the problems and the solutions tend to be the same.
The common problems center around patient access to care, practice independence and survival for physicians, and health systems’ influence on the practice of medicine at a local, state, and national level. All these factors relate to the rapidly changing practice model physicians see personally or hear about as these changes engulf communities, and reach the most rural areas of the state.
If you break down Missouri’s population to basic categories of rural, urban/suburban, and metropolitan, the same varieties of practice models exist in all these environments, but in different proportions. In the rural regions of the state, which encompass the greatest portion of the state based on acreage, lower population distribution results in unique challenges in patient access, and this by necessity influences practice models that are successful in those areas. Much of the care in these areas is provided by solo practitioners or small groups of one to two physicians, which is still the dominant model throughout the U.S. based on MGMA statistics. Simply due to the sparse population in many areas this is the practice model that can survive. What we see occurring however, is that these practices are becoming affiliated with larger practices, often hospital or hospital system-based.
Hospital and system affiliations are not necessarily bad. As a matter of fact with decreasing reimbursements and increasing costs (often driven by regulatory requirements), small practices would close up or just slowly dwindle away as a result of inability to recruit new physicians to assume the roles of retiring physician. Many of those physicians have already worked their 25–40 years and stay on since no one is coming to take their place. These practices are becoming “rural health” clinics, federally qualified health centers (FQHCs), or outreach clinics underwritten by a parent organization usually a local hospital or regional hospital system. While physicians often feel they are giving up some independence, without the administrative and financial support most physicians could never meet the intense paperwork and physical plant requirements needed to function as one of these models.
The rewards are clear: most physicians can survive financially, the communities are provided with health care services locally that otherwise would be difficult to access in distant communities, and the services often can be expanded to be more comprehensive through these models.
So what’s the concern? The loss of independence for physicians is often cited, but talking to the survivors, I find most are happy. It does relinquish much of the administrative responsibility to others but the underlying concern remains, what if funds at the state and federal level are reduced?
If you believe that eventually health care dollars will be reduced, who will be cut? If the incentives for rural clinics and FQHCs are dramatically reduced or eliminated, will hospitals and systems withdraw from the small communities? If funding dwindles, all care out of necessity needs to become more efficient and centralized with the resulting loss of local access and service in most of the smaller communities throughout Missouri. That’s what small town physicians fear, and rural communities should fear.
In the rural suburban areas surrounding communities of 8,000–25,000 persons, we see a different dynamic. There is a consolidation of smaller older community-based hospitals many times related to aging structures and financial pressures. They tend to consolidate with neighboring communities deciding to work together toward a new facility, rather than dwindle away. At times we see larger metropolitan hospitals or systems reaching out to partner with communities with very positive results. The communities have new modern facilities, underwritten many times by larger institutions and administrative support to function in the complex governmental arena trying to obtain fair payment for services provided to the clear benefit of the community. While independent solo physicians still remain in this situation, many simply aren’t willing to change their practice style especially if they are approaching retirement. Most other physicians tend to do well in these circumstances, employed by the hospital, able to recruit additional physicians to share the patient workload resulting in a better quality of life for all practitioners. However, there is some loss of autonomy, but physicians need not give up their roles as patient advocates. We have many members from practices like this who still want to be informed, want to take responsibility for their futures, and their patient’s and communities future health care. They are MSMA members, and new physicians are signing up to be part of this effort.
Suburban/urban regions face similar pressures. While solo practices shrink, small group and large groups are working together to survive. This can be in single specialty and multispecialty models but all are trying to work together to consolidate their efforts, coordinate patient care and sharing in the expenses and expertise needed to meet the ever expanding unfunded mandates of governmental insurers and commercial insurers. Additionally, strength in numbers is required for fair negotiations with insurers, since without the group incorporation individual physicians are at the mercy of mandated fees schedules forced on those who do not have the negotiating clout to acquire fair reimbursement for the services they provide to patients.
It has become increasingly clear that physicians who provide predominantly professional services, especially in the primary care fields, and don’t provide procedural services, the group structure is designed to capture some of the ancillary revenue that is necessary to offset the relatively poor reimbursements provided for cognitive services. Hospitals have calculated that revenue and while they “support” many primary care practices portrayed as money losers, they recognize the ancillary revenue they capture as an offset. What has changed in this type of practice however, are cuts in these reimbursements to physicians’ offices.
Recent reductions in payments for ancillary services such as cardiac testing in offices have not been extended to hospitals. This decrease in payments has resulted in dramatic decreases in office outpatient revenue used to compensate for other cognitive services historically underpaid. Hospitals are receiving compensation three to fives times higher for these same services simply due to the testing being provided in the hospital facilities. This creates an unfair differential and is starting to drive those physicians affected to approach hospitals to acquire their practice to maintain their incomes.
In a time of rising health care costs and broad attention to reduction of health care costs, it’s a puzzler why these discrepancies are allowed to exist. The end result is that physicians are being driven to become part of larger systems who garner historically better reimbursements for most services. While the assumption is that those profits the “not-for-profits” experience are being used to pay for uncompensated care there is little accounting of these dollars that many see are being used to support an administratively top heavy and highly compensated system.
The metropolitan model is even more complex, mixing academic programs along with multiple hospital-based systems all competing for patients, referrals and attempting to capture physicians’ practices to direct referrals, often on an exclusive basis. The mix of state and federal funding for medical educational programs adds a different dynamic to the turmoil with physicians looking for a safe haven in which to practice as individuals or groups based on their previous practice model.
With recent changes in reimbursement, many practices, for example in Kansas City, and to some degree in St. Louis are now approaching hospital systems to assume the practices to try to maintain their incomes. Hospitals who have previously met resistance from the physician community when seeking to buy up practices, now face a different problem with physicians coming to them to acquire their practice. However, hospitals realize they may not be in a position to assume all the practices.
The concern the physician community now must face is trying to survive in an ever increasingly competitive environment as a solo or group practice versus joining a hospital system which may in the near future face their own revenue short falls which could then result in eliminating the “less profitable” physicians and practices.
There is no doubt that as pressure increases to cut health care costs, eventually financial accounting will address the disproportionate payments made to hospital systems for inpatient and outpatient ser vices and move to aggressively reduce them. Reduced payment is a more effective way of reducing utilization and avoids the accusations of rationing. The rationing will come about slowly and in a more subtle fashion that the public will find it hard to identify.
Physicians are challenged at many levels, but around the state they remain flexible with their primary goal focused on providing patient care. They look at all practice models trying to find the one that fits their needs the best and allows the best options for patient access and care, trying to minimize the impact of the payor mix that can torpedo their practice’s future.
Physicians seem very willing to give up some autonomy as long as they are permitted to have direct input on patient care or be given options that prioritize patient access and quality of care. Luckily there are still options for some hardy solo practitioners, even in the most metropolitan and competitive settings.
Group practices seem to be the natural transition for physicians to remain separate from hospital and system practices with the concept of safety in numbers. Physicians also seem very comfortable adapting to hospital system practices with its benefits of avoiding administrative and billing issues, while focusing on patient care and being more able to control their time and lifestyles.
In the end, physicians are adapting to the surrounding changes in the health care arena. They are willing to sacrifice some of their independence to focus on patient needs and insuring good quality care. It is clear that physicians are an essential part of health care now and far into the future. While there may be more extenders and the mix of specialty and primary care may change, physicians will remain the primary advocates for patients and communities’ access to care.
Biography
Lent C. Johnson, III, MD, MSMA Member since 1982, is a Family Physician from Hannibal, Missouri.
Contact: lentjohnson@gmail.com
