GUJHS. 2007 March; Vol. 4, No. 1
Jonathan Olbrych ‘06
Department of Health Systems
Physicians have always been the most visible part of our health care field, and though the industry has grown exponentially in size and complexity, they remain not only the figurehead of the system, but often the scapegoat as well. The United States continues to devote a greater and greater percentage of its gross domestic product on the health care expenditures of this country, yet we are still a long way away from providing adequate care to our entire population. It is expected to first look to the most visible areas to identify where changes can be made to control costs. There is truth to the accusation that “the most expensive medical instrument is the physicians hand,” whether it is conducting surgery, writing prescriptions, or writing orders for testing. But you can only control this hand so much, through incentives (financial or not) and restraints, before the physician is entirely tied down, and unable to effectively practice medicine. The increased burdens on physicians including medical school tuition, physician reimbursement, and malpractice insurance are nearing the point of overbearing control. These factors have begun to force some physicians to practice inferior, defensive, and moneymaking medicine contrary to everything they have been taught in order to remain profitable in this inefficient marketplace.
The Business of Health Care for Physicians
The practice of medicine has evolved into a business many years ago. An undergraduate science degree and four years of medical school is no longer adequate training for physicians setting out to run a practice, although more than forty percent of medical students still follow this narrow curriculum (AMSA, 2005). A large number of physicians are outsourcing the business aspect of their practices, joining either hospitals or large physician groups such as the Lounden Medical Group that has grown from 39 to 139 physicians in the last five years (Napolitano, 2005). Many physicians are going back to school to receive MBAs to cope with the evolving business demands of health care, and others have chosen to simply abandon their profession disheartened by its direction.
While national healthcare expenditures have grown to over $1.9 trillion, to total more than fifteen percent of our Gross Domestic Product (OECD, 2002), the role of physician services in the industry grew at a modest 8.6 percent from 2000 to 2001, compared to prescription drugs and administrative costs, which rose by nearly sixteen percent and eleven percent respectively (Figure 1). Providers who administer the new expensive treatments are not experiencing the same rate of growth. In the year 2000, thirty-four percent of health care expenditures were devoted to physician services, but in just two years that number dropped seven percent to twenty-seven percent of total expenditures (Strunk, 2003).
The role of physicians in our society has long been a position of great stature, honor, respect, and reward. Health care has never been regarded as just another “service profession,” and its clinicians are put on a pedestal above other professions. But now, looking toward system reform, physician’s reimbursement is declining annually. This movement is not an initiative to introduce a vow of poverty into the Hippocratic Oath, but steps are being taken to curb physician income in an attempt to slow the exponential growth in health care expenditures. Between the years of 1995 to 1999 “all patient care physician’s” (inflation adjusted) income fell by five percent to a conservatively estimated average of $187,000. While physicians who have chosen more lucrative specialties incomes’ have dropped by four percent in the same four-year span to an average of $219,000 (Reed, 2003).
While recent MGMA data reports physician compensation having nominal increases over the past few years, physicians are incurring prohibitive increases in costs from medical education and medical malpractice premiums. Over the past twenty years public medical school tuition has increased by three hundred twelve percent, and it is estimated that eighty percent of medical school graduates carry some amount of debt into their career as a physician. The average of this burden ranges from $105,000 for public school graduates to $140,000 for graduates of private medical schools, with some reported debt as high as $350,000. The pool of medical school applicants is no longer the brightest minds in the country, but instead those who are able to afford such prohibitive costs. With the increasing debt and decreasing income physicians can start out devoting between eight and fifteen percent of their salary to pay off debt. (AMSA, 2005)
This is not the only financial burden today’s physicians worry about. As people begin to discover physicians are human, malpractice premiums continue to rise forcing many doctors out of the profession. In the most extreme case, malpractice premiums for general surgeons in Dade County Florida have risen seventy-five percent between 1999 and 2002 to $174,300 a year. (Hillman, 2003)
While healthcare continues to grow and expand as a business, physicians with human science degrees struggle to keep up and stay afloat. Doctors remain the face of medicine, and while they once were looked up to, now they are taking much of the heat from changes in the health care industry.
The Physicians’ End of Health Insurance
Increases in technology, development of new procedures and treatments, administrative costs, and many other factors combine with the cost of physician services to continue to raise the cost of health care to exorbitant sums. We have come a long way from the day of the simple, affordable patient-doctor two-way street, and have since moved to an eight-lane highway. As care became unaffordable, physicians encountered hurdles in collecting their fees, and many patients had to be turned away. In 1931 private hospital occupancy fell to sixty-two percent and providers struggled (Bodenheimer, 2002). The first health insurance companies were soon to follow, with the intention of taking the role of credit checks, bill collection, and other burdens of paperwork off the shoulders of the providers.
The original employment based insurance companies provided a much-appreciated “steady source of income” for physicians (Bodenheimer, 2002). Doctors were once again able to practice without the fear of not getting paid. The American Hospital Association established statewide Blue Cross health insurance plans, snowballing to provide coverage for 6 million employees, and soon followed by the Blue Shield plan to cover physician services (Bodenheimer, 2002). In the beginning these “green” insurance companies were much smaller than the well-established health care providers and paid whatever health care bills their clients incurred. Providers practically controlled “the Blues,” setting their prices wherever they desired. The “Blues” offered generous reimbursement, and were naive to the idea of cost containment.
Soon these employment health insurers outgrew their masters and began biting the hand that fed them. Now that they control the majority of the work force and therefore the majority of the patient population, these health insurance providers have taken the power away from the doctors and now control much of the health care market. Insurance companies, and eventually managed care organizations, have since been ratcheting down physician reimbursement through capitation, and arbitrary reduction of fee for service in an attempt to control their costs. Physicians have not only lost the economic benefit, but in many cases have also lost the clinical decision-making power, and the incentive to provide the highest quality of care. President of the Pennsylvania Orthopedic Society, Lewis S. Sharps, M.D., believes, “Under capitation, from an orthopedic standpoint, you would do better if you didn’t take care of patients.” (Guadagnino, 2000) After a significant 1998 reimbursement cut from Blue Cross, the physicians of the Pennsylvania Orthopedic Society began looking for another way to control costs while maintaining sufficient reimbursement so they could continue to provide high quality of care (Guadagnino, 2000). By 2001 eighty-eight percent of physicians held at least one managed care contract and thirty-two percent had capitated contracts (KFF, 2004).
If health care costs, and insurance premiums are continuing to rise, and reimbursement per procedure continues to fall, where is this money going? While most statistics are sky rocketing there is one that not only has leveled off, but has been declining since 1997—medical expense ratio. While insurance companies are bringing in more and more money in premiums and their administrative costs have shot up to $421 per person covered, physicians continue to struggle as these powerful companies pay out less and less each year (KFF, 2004).
The Doctor – Government Medicare Tug of War
An even greater force controlling physician reimbursement is the United States Government. With the baby boom population nearing retirement, the government controls the health care expenditures of more Americans every day. The American Medical Association is currently fighting hard on capital hill to protect its doctors from another Medicare cut in providers’ payments scheduled for 2006; a plan that congress has been using in attempt reduce the costs of Medicare since the 1997 budget law. The AMA is a prominent voice, threatening to pull out of Medicare all together if the reimbursement rates drop too low. They have been successful twice in avoiding scheduled cuts, but despite their efforts physicians incurred a five and a half percent rate reduction in 2002 (Adams, 2005) bringing Medicare’s payment to cost ratio to just under ninety-eight percent of doctors costs, (OECD, 2002) which is surprisingly fair considering the volume of patients program represents (KFF, 2004). Physicians face the threat of payment cuts totaling twenty-six percent over the next six years when in that same period “the cost of running a practice and caring for patients will go up by fifteen percent” (Adams, 2005). The doctors are a group that is easy to sympathize with, however the government is also struggling as the Medicare budget rose to $333 billion last year with physician services accounting for roughly $54 billion. Something has to give, but neither side is going down without a fight.
The Medicare system is built for physician fraud and inefficiency. Doctors are rewarded for providing ineffective care, reimbursed for every follow-up visit, verses receiving only one payment if the job is done right. In addition to these rewards doctors are tempted to take advantage of the poorly monitored system. In 1999 HHS estimated approximately $13.5 billion was lost to improper payments, almost eight percent of the total budget (AAPS 1, 2000). Such claims include OB-GYN services for men and claims on deceased patients. Granted the vast majority of physicians follow scrupulous billing techniques, this is still a cause of concern.
Another source of increasing physician service costs despite congressional cuts is the increase in frequency and complexity of services billed for. Following the 2002 physician reimbursement cuts of five and a half percent, the volume and complexity of services increased by more than six percent per patient, resulting in a loss of thirty to fifty percent of the savings anticipated from the cuts (Adams, 2005). From 1999 to 2003 Medicare spending on physician ordered imaging services grew over sixty percent (Adams, 2005). Physicians argue that such increases are a result of the aging population entering Medicare and increases in chronic diseases and technological advancements.
While a few physicians continue to take advantage of Medicare’s flaws, a growing number, frustrated by the declining reimbursement and corruption, are declining their involvement in the program. An AAPS survey of physicians revealed that almost one quarter of doctors are not accepting any new Medicare patients while only fifteen percent are refusing new uninsured patients (AAPS 2, 2000). Of those turning away Medicare patients twenty percent do so because of the hassles and threats from Medicare carriers, and another sixteen percent site low reimbursement rates as the reason (AAPS 2, 2000). An even greater percentage (over 1/3) of doctors are restricting certain services to Medicare patients for similar reasons (AAPS 2, 2000). As the baby boomers begin to flood the Medicare market, it is becoming more and more difficult to find doctors to accept these patients. Over one third of physicians have had difficulty finding a referral for their Medicare patients. But it is difficult to blame the doctors and their staff, who spend over a fifth of their time on Medicare compliance issues, costing them more than twenty-seven percent more to process a Medicare claim over a private claim (AAPS 2, 2000).
Additional Burdens on Physician Reimbursement and Practice
Forty years ago when Medicaid was enacted, the physicians and providers were unable to predict the over whelming control the government would have in controlling costs nor did they have the political clout to avoid it. Physicians continue to struggle providing care for the underprivileged population due to prohibitively low reimbursement rates of Medicaid, and the “antidumping” laws requiring that care be provided.
Though far from the seventy-nine percent payment-to-cost ratio Medicaid reimbursed in 1988, the current provider reimbursement still hovers below one hundred percent of the cost to physicians of providing this care (OECD, 2002). Even with the reimbursement rate increasing the proportion of physicians providing care to Medicaid patients continues to decrease, from eighty-seven percent in 1997 to eighty-five percent in 2001. There is no incentive beyond ethics encouraging physicians to provide care to these populations, and even though the vast majority of physicians still deliver some amount of charity care for a loss, it is usually a very limited amount. More than half of physicians attribute less than ten percent of their total practice revenue to Medicaid, and over seventy percent spend less than five percent of their time delivering charity care. Physicians are unable to continue to operate in the red and therefore they are closing their doors on these Medicaid patients. In 2001 the number of physicians who are not accepting any new Medicaid patients rose to twenty-one percent, leaving these individuals with fewer and fewer options. (Cunningham, 2002)
However not all physicians have the luxury of simply closing the door. In 1986 Congress passed the Emergency Medical Treatment and Labor Act preventing hospitals and emergency room physicians from refusing to provide services or transferring patients because of their inability to pay, or because they are covered by Medicaid. This mandated care accounts for sixty-one percent of emergency physicians’ bad debt. A 2003 American Medical Association study reports this debt totaling $138,000 annually. According to the Centers for Medicare and Medicaid over fifty-five percent of the average emergency room physicians time is spent delivering uncompensated care, compared to the majority of physicians limiting this to five percent (Bebber, 2005).
While the majority of literature advertises Medicaid rates and spending are on the rise, the growth can barely keep up with the increase in cost of care. From 2000 – 2003 Medicaid spending increased by six percent per enrollee. Comparatively, the growth of spending per enrollee under private insurance rose almost eleven percent (KFF, 1999). Without these rates being competitive physicians are forced to turn away Medicaid and indigent patients, despite any moral qualms, simply to keep their business afloat.
Perhaps the most significant concession physicians are making in providing indigent care is being forced to change the way they practice medicine. These patients, without means to pay for care, postpone seeking care and often do not follow recommended treatments, leading to late stage diagnosis, hospitalization for avoidable conditions, and Band-Aid approaches to treating chronic diseases. Dr. Debra Richter confesses to The New Physician magazine, “Every day, I practice survival medicine in an industrialized country” (Bell 1, 2000). This inefficient type of medicine causes even more of a strain on an already burdened health care system.
The situation continues to get worse as our current estimate of 45 million uninsured Americans grows by 100,000 each month, according to a Health Insurance Association of America study, despite a strong economic period. The study predicts more than one in five Americans to be uninsured in fewer than three years from now. (Bell 1, 2000) But while this number continues to skyrocket, the number of physicians committing to provide care to this indigent population is declining almost as significantly. From 1997 to 2000, while we experienced some of the sharpest growth in the uninsured, there was nearly a five percent drop the number of physicians providing of charity care—seventy-six to seventy-one percent (Cunningham, 2002). With fewer options in receiving care, the uninsured will continue to postpone or avoid seeking care they need.
The uninsured are thirty-two percent are more likely than those with insurance to postpone seeking care because of anticipated costs (KFF, 2003) These decisions have an adverse effect on the health of the uninsured contributing to why they are more likely to “live sicker and die younger” (Bell 2, 2000). Not receiving adequate and timely care has many consequences: fifty-seven percent of avoided care resulted in a “painful temporary disability”, fifty percent led to “significant loss of time at important life activities” (i.e. work), and nineteen percent led to a “long term disability” (KFF, 2003). Because these patients were forced to make the choice of postponing necessary care anticipating costs they are now in a deeper financial rut. This is in addition to the thirty six percent of patients that do not fill prescriptions or adhere to treatment schedules because of cost, often nullifying any care they have received (KFF, 2003). Patients of Dr. Helen Burstin and many other physicians ration their medication, “tak[ing] it every other day so it’ll last longer,” unknowingly increasing their risk of relapse (Bell 1, 2000).
Doctors are in a very difficult position, altering the way they practice medicine. Dr. Richter admits to “feed[ing] into what patients want and end up not giving the best medical advice,” recalling being begged not to send a patient to the ER, because she would have no way of paying. In other examples, Dr. Richter has treated patients as outpatients with whatever medication samples she had, or making diagnoses over the phone to avoid the cost of an expensive visit. “The system forces you to practice inferior medicine on the uninsured… it goes against everything we were taught.” (Bell 1, 2000)
Choices and Beliefs in Long-Term Care
Another facet of the United States Healthcare system that raises conflict between how physicians practice medicine verses what they are taught is the institution of long-term care. “I will apply dietetic measures for the benefit of the sick according to my ability and judgment; I will keep them from harm and injustice.” Physicians most commonly accept this translation of Hippocrates’s Oath as a goal to provide the maximum level of care, no matter the cost, with the intention of preserving life. This attitude has contributed to striking costs of end of life care—almost $18,000 per Medicare enrollee in certain regions during the last six months of life. Another potential contribution to these costs is some physicians’ drive to draw money from our fractured health care system, in an attempt to compensate for low reimbursements in other areas in which they are losing money. These motivations to continue to treat terminally ill patients in a hospital setting instead of transferring them to a long-term care facility are beliefs not only held by physicians, but patients and families as well, for only twelve percent of the population would choose to receive care in a nursing home over a hospital, reveals a Kaiser Family Fund survey of adults (KFF, 2005).
The 1999 Dartmouth Atlas of Health Care provides the evidence supporting this propensity for acute care treatment, in the last six months of life. Almost half of Medicare deaths occur in hospitals rather than at home, or in a long term care facility, with almost a thirty percent chance of being admitted to an intensive care unit, attached to numerous machines preserving life, verses the peacefulness of other settings (Dartmouth 1, 1999). Physicians’ role also increases in these last six months of life, as forty percent of Medicare enrollees visit their doctor during these months, with as many as fifty visits per enrollee in these terminal months (Dartmouth 1, 1999). The complexity of services rises as well as physicians’ “propensity to refer” leads to as much as a third of certain populations seeing ten or more different physicians in their last months (Dartmouth 1, 1999).
The Dartmouth Atlas Survey reveals more than eighty of patients would like to avoid hospitalization, but the Kaiser Survey reports that only twelve percent would choose a nursing home over a hospital when requiring around the clock care (Dartmouth 1, 1999; KFF, 2005). The only explanation for this is dissatisfaction with the current long-term care system. More than twice as many people feel that a nursing home makes a person “worse off” than believing it can improve a patient’s condition (KFF, 2005). The most common explanations for these negative feelings include, under staffing, poorly trained staff, along with waste and fraud by the facility (KFF, 2005). The physician’s role is also inadequate. An early 1977 survey of private practice physicians reported less than thirty percent of physicians provide care in long-term care environments, and this number remains unacceptably low (AGS, 1993). A more recent survey by the American Medical Association revealed sixty-five percent of physicians reporting “spending no measurable time caring for nursing home residents” (Swagerty, 2000). Physicians cited low reimbursement and difficulty in collection as major factors, in addition to other administrative barriers (AGS, 1993). As the number of people becoming eligible for Medicare increases, it is estimated that the number of physicians needed to care for this population is likely to double or even triple (Swagerty, 2000). Changes must be made to encourage physicians to move away from the expensive and often fruitless acute and intensive care efforts of preserving life, in order to meet the demands of this growing and neglected long term care population.
Physicians’ Fears: Mistakes or Malpractice
Despite the large strides we have made in technical advancement our medical system to provide end of life and specialty care, the quality of care provided by individual physicians and systems remains unacceptable. In 2000 the Institute of Medicine reported that between 44,000-98,000 Americans die from medical errors annually (IOM, 2000). These are all errors that could be prevented with a combination of individual physicians being more careful and system wide changes in procedure and accountability. But how do you force physicians to be more careful and accountable? The steep rise in malpractice suits and premiums has evidently not been effective despite choking many physicians out of practice. The combination of new technology, malpractice, and other factors have contributed to increased costs of health care, but the Dartmouth Atlas of Health Care 1999 shows there is no correlation between quality of care and dollars spent (Dartmouth 2, 1999)). Is financial motivation the only way to drive doctors to improve the quality of care they provide?
Our current incentive system for physicians moves the issue of quality out of the control of the health care system and into the courtroom, costing surgeons in Dade County Florida as much as $174,000 in premiums alone (Hillman, 2003). As we stand today physicians are fearful of making a mistake that could cost the system time, money, and potentially lives, in addition to having their reputation stigmatized. But these fears often come second to their fears of the personal burden they will shoulder if the medical error is discovered and they taken to court loosing their own money in legal fees and increased premiums.
These fears have contributed to why many physicians have been forced to practice defensive medicine; another example of how physicians are being told to practice contrary to how they are taught. The amount of health care dollars spent on diagnostic imaging continues to rise from year to year, along with other laboratory and diagnostic testing. Physicians are aware that there is currently no reason not to order as many tests as possible, and in fact there is a reverse incentive, as they gain reimbursement for each additional procedure. In affect, we watch costs rise while quality and outcomes continue to fall.
Our current fee for service payment method also reinforces physicians’ carelessness and medical errors. Under the current system physicians are paid for a procedure regardless of its outcome. Poor outcomes, actually offer greater incentives, as a physician receives payment for each additional procedure necessary to correct for any errors that have occurred.
We would expect costs and technologies to be effective in controlling quality, but used improperly they can also add to the problem. Physicians must be given the incentive to consciously improve the quality of care provided, as individual healthcare professionals are responsible for over half of our medical errors (KFF, 2002). But what method should be used as incentives remains unclear. There is strong opposition by the American Medical Association to “pay for performance reimbursement methods, and other quality reporting mechanisms. There must be some non-financial incentive scheme that doctors will respond too more effectively, than the fear tactics of the current medical malpractice approach. As we move forward in increasing the quality of health care in America, the main focus should be on consistency—you cannot provide quality care without equality from one patient to the next.
Disparities in Doctors Lead to Disparities in Care
In the formation of this nation Thomas Jefferson and our forefathers professed, “We hold these truths to be self-evident, that all men our created equal,” but almost two hundred thirty years later we still do not treat each other as such. Though great strides have been made, there are still significant gaps in the care provided to minorities in this country. African-Americans are almost twice as likely to report to being in fair or poor health than non-Latino Whites (KFF, 2003). Over a quarter of our Latino population reported making no visits to a healthcare facility in 1999, when almost thirteen percent of them reported being in fair or poor health (KFF, 2003). The data is out but misperceptions, and misinterpretations by the population, but most importantly our physicians, challenge its acceptance. It is time that we stop identifying the problem and start working to fix it.
While more than half of physicians agree that patients are rarely treated unfairly due to race or ethnic background, doctors of different racial and gender backgrounds hold distinctively different opinions on the severity of any disparities (KFF, 2002). African-American physicians are the most willing to accept that all disparities are a significant problem: based on race, insurance, money, sexual orientation, language, disability, education, or gender (KFF, 2002). They are more than fifty percent more likely to suggest our health care system treats patients unfairly based on race or ethnicity, than white doctors according to a Kaiser Family Foundation survey of physicians in March of 2002 (KFF, 2002). One third of female physicians report that our health care system treats people unfairly based on their gender, compared to the ten percent of male doctors that agree with this accusation (KFF, 2002).
When we ask these same physicians who said our health care system “very/somewhat often” treats people unfairly based on race/ethnicity why these disparities exist fifty-eight percent suggest that “minority groups live in areas where there are fewer doctors” and fifty-two percent blame the fact that “many doctors are not skilled in communicating with people from different racial/ethnic backgrounds” (KFF, 2002). These are both factors we can make efforts to improve. A better reimbursement scale form Medicaid and the current indigent population will reduce the financial incentive for providers to choose to practice in affluent areas, neglecting the poor/minority regions. Medical schools of states with large rural and underprivileged populations are making an effort to encourage physicians to address these populations with discounts on tuition. But, “It was the social seclusion that forced me to leave the public health service in South Dakota,” confessed Dr. Steven Napolitano, and this is a force that is not easily combated. Altering the medical school curriculum to include language and cultural communication requirements is an even more realistic way to begin to lower these disparities.
Another step to eliminating racial disparities is to continue to work to increase minorities’ presence in the physician field. Despite affirmative action and other efforts of the past half-century, minorities only make up less than ten percent of our nations practicing physicians (KFF, 1998). This issue is on a much larger scale than affirmative action can hope to solve. There are significant disparities in our education system well before the post graduate level, providing disproportional under qualified minority applicants. Another explanation for this gap is the rising costs of medical education. The already low applicant percentage of minorities continues to drop between acceptance and matriculation (AAMC, 2005). Continued efforts must be made to keep our physicians as the brightest and most diverse of our population, not merely those who can afford the education.
Physician Offers Abroad
The United States governmental per capita health care expenditure is among the highest of any country, in addition to spending between 4 and 8 times more on private health care, yet we do not even come close to providing adequate care for our population (Figures 2 and 3). A significant contributing factor to these expenses is rising physician incomes. An established invasive cardiologist can hope to make upwards of $400,000 a year here in America (Allied-Physicians, 2004), while the United Kingdom is recruiting heart specialists internationally making offers of less than $118,000 (BBC, 2001). Thus far we have seen a propensity in the physician population to be driven by financial incentives, but are our physicians willing to take this steep a pay cut to practice medicine in a more stable environment?
Tony Blair and other British politicians have begun to look abroad to recruit physicians to combat their growing problem of physician shortages, long wait times, increased consults, and other rising pressures on their National Health Service. By February of 2002 the new recruitment program had over 2,500 “expressions of interest”, just five months after being launched, and 600 firm applications (BBC, 2001). Their goal was to bring in an additional 9,500 general practitioners and consultants by 2004(BBC, 2002). Surprisingly many of these imported physicians are coming from the United States. An offer of a salary less than half American standard, with a 2-year contract, a relocation allowance, accommodation expense, and a pension rebate at the end of their fellowship appears to be enough to convince many American doctors to pack up and cross the pond.
The United Kingdom is not alone in successfully recruiting physicians overseas regardless of the substantial pay cuts. Australia and New Zealand are both very active in international medical recruitment. The base salary for a specialist in Australia is as little as $80,500 U.S. dollars but could double with overtime and salary packaging, but still is not competitive with the high United States salaries (IMR, 2004).
Perhaps it is the stability that is attracting these U.S. physicians. The base salary in Australia is reflexive of a 38-hour workweek, with each additional hour paid at “penalty rates (usually double-pay)” (IMR, 2004). This flexibility is attractive to physicians pressured by the demands of our current system, putting in between 60-70 hours a week (Napolitano). These aggregate hours of work have increased by three percent in 2000 and another four and a half percent in 2001 (Levit, 2004). These increased hours are mostly attributed to the increase in paperwork physicians face with every procedure; consequently these new hours are un-reimbursed (Napolitano). The salary packaging strategy of Australia is also attractive giving physicians access to almost a third of their income tax free, increasing their take-home salaries. This allowance is a result of all hospital employees’ being exempt from “Fringe Benefits Tax”. Additional perks include up to fifteen paid absences per year, a nine percent pension, meals, and accommodation (IMR, 2004).
But perhaps the deciding factor for American physicians moving abroad is not the packages they are receiving, but the troubles they are leaving behind. Much of the difference in salaries is negated by sizeable malpractice insurance premiums, and other fees doctors must pay for out of pocket in the United States, but in these other countries they are under the security of the federal government. The combination of all of these factors does not make the decision clear but does open the door to such choices as moving their practice abroad. A partner of Dr. Stephen Napolitano’s is leaving for New Zealand in the next six months, citing his disenchantment with the direction that health care has gone in this country as the most prevalent of his many reasons (Napolitano). It appears our physicians are responding to more than just financial incentives, which could be a big step in reforming our own healthcare system and controlling costs.
There are two distinct ways that physicians can choose to deal with these burdens our health care system imposes on its doctors. Dr. Stephen Napolitano chooses to look at our health care system in his thirty-four years of practice as a “continued experiment; yes it is different and yes it is more difficult but the practice of medicine is essentially the same” (Napolitano). While in Ecuador last year, serving underprivileged populations, one of Dr. Napolitano’s younger partners approached him with the statement, “Isn’t this so different?” but Dr. Napolitano disagreed; medicine is “essentially the same” no matter in what setting or under what restraints it is practiced. Unfortunately, not all physicians are able to see the big picture, and are more disenchanted by the direction the system has taken. Six of the seven physicians Dr. Napolitano has remained in contact with since medical school have chosen early retirement as a means of escape. It was not only the financial changes in the system that fueled the disenchantment that caused these physicians to leave their professions, Dr. Napolitano explained. It was most prominently the loss of control, a long with the increased paperwork, and decrease in reimbursement that influenced these doctors and many others to do the same. Physicians may be taking a lot of heat with recent health system changes, but the problems are truly system wide. The fact that some of our physicians are willing to take significant pay cut, for the stability of practices abroad. This signifies that we are ready to take the next step in this “continued experiment” and better protect our doctors, freeing them from the burdens of financial and legal claims, so they can focus on the practice of quality medicine.
- Can you start by giving me a brief history of your personal practice. i.e. how many years have you been in practice, have you always been in Virginia, etc.
- In those years I’m sure you have witnessed changes within the system itself, how have these changes affected the way you have practiced medicine, if at all?
- How do you and your colleagues deal with the business of medicine, which is playing more of a prominent role in the field? Did you graduate with a science degree? Have you or any of your colleagues gone back to school for MBAs, or other schooling?
- Are you at all disenchanted with the direction of medicine, to the point of considering retirement or moving? Or do you have an affinity for the administrative aspect, and consider giving up your practice for a more administrative role?
- Do you have any feelings about the way malpractice insurance is run; is it effective in improving quality, or restrictive?
- Have you increased the number of hours in your work-week since first going into practice, and to what do you attribute any changes?
- Do you witness any disparities in the way health care is delivered to minority populations, conscious or unconsciously.
- What has been your experience with the government programs of Medicare and Medicaid? Have the reimbursement rates or increase paperwork forced you to turn patients away?
- Do you encounter a large population of the uninsured in your practice? How do you deal with this population?
- Do you see the current state of health care in this country as getting worse or improving, or stagnant? What do you believe can be done to improve this system, what concessions are you willing to make, lower pay for stability?
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