Indianapolis Medical Society

President's Message October 2008

John P. McGoff, MD

“We should not expect a single set of reforms to address rising healthcare costs; rather an eclectic approach will probably be needed.” - Ben Bernake, Chairman of the Federal Reserve

What exactly does that mean? Have you heard all the buzz generated by our Presidential candidates about their great ideas to solve the health care crisis? Nothing, not a word. Sadly, it does not even make the top three issues that concern most Americans. As physicians, we know it is truly the 800-pound gorilla in the room and any proposed solution will make resolving the crisis of Social Security reform look like a cakewalk.

So let us review some of the issues and background. The growth in the Medicare program was already a dilemma prior to the passage of the Medicare Prescription Drug Plan. There are serious questions of insolvency with longterm financing and over the coming decades, we will have to raise taxes or cut spending to the tune of 36% just to fund the gap. If you are not interested in seeing your taxes go up, try telling your elderly parents, that you are going to cut their benefits. See if you are invited to Thanksgiving this November.

It is a problem we have created ourselves. Physicians are to blame. What? We have become so good at treating disease, that we have transformed terminal illnesses into chronic diseases. A single patient on dialysis costs $65-70,000 year. We now have 133 million people in this country with a chronic disease. That is why you see all the energy insurance companies are expending on chronic disease management. Hospitalizations related to congestive heart failure have tripled over the last 25 years and spending has risen accordingly. Everyone hears about how much we spend on healthcare in America relative to our peers, yet we have worse outcomes and lower life expectancy.

Why do we spend more and have worse outcomes? This is where we can place the blame squarely on our patients. Seventy percent of chronic disease is the result of lifestyle influences, e.g. smoking and obesity to name a few, with Indiana at the top of the pack in both of those categories. Medicare patients have an 18% readmission rate within 30 days of discharge costing the system over $15 billion annually.

The average physician is receiving $1.00 back for every $1.30 care they provide to a Medicare patient and Medicaid is even worse. Is it any wonder that docs are limiting their practices to fewer and fewer government-sponsored patients? We, as providers, are the safety net of society. We are asked to somehow absorb the cost of catastrophic care to the uninsured and underinsured, all the while attempting to comply with a set of Byzantine, incomprehensible and ever-changing regulations.

So if this is not enough doom and gloom for you, just wait there is more. This past June, the Congressional MedPac Medicare Payment Advisory Commission issued a report that said, “the fee-for-service (FFS) payment system fails to encourage providers to cooperate with one another to improve coordination of beneficiaries care and appropriately control the volume and cost of services delivered.” We have known this for years. The more we do, the better we are reimbursed. You will not hear anything about this between now and January, when our new President takes office, but this will become priority number one for the new administration. There is an even odds chance that we will not be paid by the feds under a FFS model in the very near future.

The new pay-for-performance initiatives coming are actually just another way for increased scrutiny and decreased payments. It is another hoop we will all jump through to collect what we are already owed. If you remember your high school history class about medieval torture chambers, there was a horrible device called the “rack.” Well the fed’s have a new “RAC” or Recovery Audit Contractors, who have been hired to look for fraud and waste in healthcare. The initial pilot study in five states was so successful, that they will roll it out nationwide over the next few years. They collected a quick $357 million and it only cost them $77 million to pay the contractors. It was mostly a hospital venture, but they did look at physicians and recovered $12.3 million. Guess what the sins of the physicians were: incorrect coding, insufficient documentation and only $200,000 of the total deemed medically unnecessary care.

So what is the real healthcare crisis that no one is addressing? The projected physician shortage of 100- 200,000 doctors over the next decade. Did you know that the Indiana School of Medicine is adding 15 new students a year for each of the next five years? While that is good news, do the math. The first graduate will not be available to see patients until 2015. It should be worrisome to every physician and patient, just because everyone in America has an insurance card, will not guarantee healthcare. One needs look no further than the disaster in Massachusetts. First, it is $630 million over-budget and as far as access is concerned, over half of the internal medicine practices are not taking new patients.

While the shortage of primary care physicians is staggering, some 44,000 by 2020, the progressive increase in specialization has continued to grow. Fewer and fewer medical students are choosing family practice, general internal medicine and pediatrics.

However, it is a problem for specialists as well, and the numbers are huge: 24,000 general surgeons, 10,000 orthopedists and 9,000 cardiologists short by 2020.

I hope that this will serve as a clarion call for physicians to stay involved. The future of medicine as we know it today will not exist five years from now. It is unsustainable. It is incumbent upon us to be at the table when the negotiations are taking place. Organized medicine is fractured and each subspecialty wants their piece of the pie, but we will fail if we splint off into our respective groups and do not stand together as physicians. We are the most recognized voice our patients have and we cannot afford to be shouted down or ignored by the coming clamor of catastrophe.