Thursday, April 1, 2010

"April Fool" from your Government

Medicare payments are being slashed by 21.2% beginning April 1. An article I received today illustrates the impact this will have on physicians and Medicare patients. This is some of the advice being given to doctors on how to survive the crisis this creates. I've posted some excerpts below, with my comments in italics.

Medscape Business of Medicine, "What to do on Day 1 after the Medicare cuts," Leslie Kane, MACC


As of this moment, draconian Medicare cuts will be imposed on April 1 because the Senate failed to pass a bill extending the effective date of the cuts to May 1…Many believe that these drastic Medicare cuts will ultimately not occur. But if this devastating scenario does take place, it won't be business as usual for doctors. Physicians will need to take immediate "staunch the bleeding" actions as well as making longer-term "how will we survive" changes.

The cuts will actually occur. Congress has recessed without correcting the problem. It is possible that they will correct it when they reconvene, and may possibly make the correction retroactive, but for now the cuts are in place.

Day One: Key Actions to Start Off

1. Get Your Lines of Credit in Order

Whether the Medicare cuts stick or not, you're going to have no cash flow from Medicare.
If you don't have a line of credit, get one set up and make sure you know how to access it. If you have one in place, make sure it hasn't expired. Look also to any personal lines of credit you have or could get quickly.

This got my attention right off – the first suggestion is to go into debt to keep the doors of your practice open – and not just business debt – personal debt! Doctors tend to be a committed bunch, but putting your family into debt in order to keep working?

2. Hold Off on Funding Your Pension and Making Nonessential Purchases

I suppose as long as you’re putting your business and family into debt in order to continue caring for patients, there’s nothing left over to plan for your future or help stimulate the economy.

3 Get All Hands on Deck to Attack Accounts Receivable

If you have 3 people at your front desk, I would be taking someone off and putting that person on the accounts receivable. If you do this, the office phones might ring a little longer than usual. You may need to explain to patients that you have your staff working on a special project right now, and your staff is tied up.

In case you’re wondering why it’s harder than usual to get through when you call your doctor, it’s because everyone is scrambling to try to find some cash to pay the bills.

4. Collect All Co-payments at the Time of the Visit -- No Exceptions

If your office doesn't currently require the co-payment before seeing the doctor, get your front desk staff to phone every patient scheduled to come in over the next few weeks. Tell them what your new co-pay policy is, so they will be sure to bring cash or a check.

I’m not sure where the staff is going to find the time to call every patient to make sure they show up cash-in-hand when they don’t even have time to answer the phone.

Longer Term Actions

1. Restructure or Reschedule Medicare Patient Encounters

It's too extreme for most doctors to eliminate all Medicare patients from their practice, and many would not want to. But doctors can still allocate fewer resources to that patient.Physicians who can replace Medicare patients with other patients should limit appointment exposure to Medicare patients and give better service, quicker availability, to the patients with better paying plans. Doctors have to ask themselves, "How many hours of the week can we afford to see patients paying 21.2% less than they were yesterday?"
You could allocate certain times to see just Medicare patients, such as Tuesday and Thursday mornings. When Medicare patients call for appointments, the staff would say, "We will put you in on the next Medicare clinic day." Or you might consider hiring a nurse practitioner to see the Medicare population.

*As the child of someone on Medicare, this is what terrifies me the most about all this. It will be increasingly difficult for people on Medicare to get the health care that they need. Fewer doctors will be able to afford to see Medicare patients. Those who do may have fewer appointments available for them, spend less time with them during their visit, or delegate their care to ancillary providers instead.

2. Look at Getting an EMR Even If You Don't Like the Idea

If you purchase and implement an EMR system, you can get incentive money available to you from the government.

More reliance on the government – isn’t that what got us in this situation in the first place?

3. Re-examine Your Staffing Needs

If your practice situation becomes really dire after Medicare cuts, you may eventually have to cut some staff. However, instead of letting people go, you may want to put some people on a part-time schedule.

More bad news for an already fledgling economy.

What Does This All Mean?

Potential impending changes to payment rates could indeed be catastrophic for many -- if not most -- physicians. But after reconnoitering, medical life could reach a new "normal."

A "normal" which, I'm afraid, will include a lot fewer physicians in this country.

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