Short Takes On News & Events

Report: Higher Payments Are No Cure For Doctor Shortage

By Jordan Rau

July 17th, 2012, 1:02 PM

Medicare should not try to address the shortages of doctors and health care providers in some areas of the country by raising reimbursements to lure practitioners there, the Institute of Medicine recommended Tuesday.

The committee concluded that while “there are wide discrepancies in access to and quality of care across geographic areas, particularly for racial and ethnic minorities,” those variations did not appear to be due to Medicare payments and were unlikely to be influenced by changes in rates. The report, which was commissioned by the Department of Health and Human Services, said:

The committee concluded that Medicare beneficiaries in some geographic pockets face persistent access and quality problems, and many of these pockets are in medically underserved rural and inner-city areas. However, geographic adjustment of Medicare payment is not an appropriate approach for addressing problems in the supply and distribution of the health care workforce. The geographic variations in the distribution of physicians, nurses, and physician assistants and local shortages that create access problems for beneficiaries should be addressed through other means.

The committee noted that Medicare last year started providing bonus payments to primary care providers and for general surgery in some underserved regions of the country through 2015. But a more sweeping adjustment of payments of the type the panel discouraged would be much more controversial, as it could lead to lower reimbursements in areas of the country with a surfeit of providers, since federal law requires geographic adjustments to be budget neutral.

Instead of altering payments, the committee recommended that Medicare pay for services such as telemedicine that improve access to medical care in underserved regions. It also encouraged states to change scope of practice laws so that nurse practitioners can provide more care, something the institute has pushed for in the past.

Medicare already pays more to providers in areas of the country that are expensive to live or practice in. The first part of the Institute of Medicine study, released last year, recommended that Medicare make a “significant change” in the way it estimates these costs. Among the recommendations were that Medicare should use government data rather than hospital reports to calculate regional wages and to stop using the price of two bedroom apartments to estimate commercial rents.

In its new report, the committee performed statistical simulations of those earlier recommendations and concluded that for most doctors and hospitals, their reimbursements would change by less than 5 percent on average. The report added: “The change in practitioner payments, however, would tend to redistribute payments to metropolitan areas from nonmetropolitan areas, including some that historically have been underserved.”

Still outstanding are the results of a separate IOM committee looking into why Medicare spends more on patients in some areas of the country than others without always giving better care.

jrau@kff.org

9 Responses to “Report: Higher Payments Are No Cure For Doctor Shortage”

  1. oncdoc says:

    There is no shortage of primary care physicians anywhere who are willing to see pts for reasonable reimbursement, only a shortage of those willing to see pts with low paying and high overhead producing government contracts. A 5% increase in medicare fees in underserved areas will do nothing to help.

  2. Mary D. says:

    Doctor shortage? Not when they keep threatening to stop seeing Medicare patients! We need more ACO’s that operate with a wellness incentive and less fee-for-service shysters. We need less volume of care and more focus on good outcomes. FACT: We need more nurses doing primary care. If PCP’s are honest, they will admit that 85 percent of the cases in their routine day could be handled in a community health center by a nurse. The sooner we see the end of Marcus Welby type fee-for-service health care delivery, the better off the health care consumer will be. For far too long, the consumer has been ignored. It’s time that consumers were given their rightful position as the most important ingredient in health care. Not the providers! Republicans have health care policy completely backwards! They place insurers, providers and pharma at the top of the food chain when they should be placing the consumer at the top.

  3. Doctor says:

    Pushing to lower the value of medical care provided by physicians is not the solution of better quality of care. Nurse practitioners don’t know anything. In my experience of over 15 years, I have seen them make awful decisions and get away with it many times. Fee for service is not the devil that some people make it out to be, but better forms of reimbursement are possible. Cutting the rates to Medicare is a bad idea in underserved areas, because no body wants to work there except people who need go to those areas so they can become legal residents of this great country. Americans in general need the incentive to locate to tiny towns and sacrifice their children’s education, social values and infrastructures of living near family and friends, and sacrificing a large part of their early adult life so they can make a little extra money and get financial stability. Financial stability is not an evil goal.
    If doctors strive hard in their youth to build a career that pays a good solid income and build a nice nest egg, why does it bother some of you? It’s not like any of them are making 1 million a year. Avg salary and income is between 150-350 thousand dollars. This is very low for years of sacrifice and education. Compare this to bankers and stock traders and venture capitalists and other industries which are bent on just making money no matter the consequence. These guys have destroyed economies by poor decision making and made millions and billions for only a few individuals. I would also remind everyone that most of the Medicare money does not go to doctors. Only about 20%. So I would recommend focusing solely on insurance companies and hospital cuts. The lowest of the low of good graduate schools graduates end up running hospitals. I know multiple hospitals being run by technologists and nurses with no administration experience. Basically, garbage in leads to garbage out. Good luck. God bless.

  4. oncdoc says:

    The geographic areas that we are talking about are dominated be Medicare, Medicaid and No-pays. Anyone who knows anything about the practice of Medicine will tell you that running a practice in these areas is becoming impossible! The pts who live in these regions for the most part are not interested or in any way capable of directing their care and if they were would travel to a larger medical center.
    Everyone keeps coming back to primary care! I agree that there is no shortage of primary care and that NPs can fill a role there. The problem is going to be surgical and specialty medicine where there will be a real shortage, esp in those areas mentioned above . NPs cant replace surgeons and specialists

  5. ucity88 says:

    ONCDOC: ” The pts who live in these regions for the most part are not interested or in any way capable of directing their care and if they were would travel to a larger medical center.”

    What a ridiculous, elitist point of view to take at the expense of the poor and needy in our country! You must think that poor people are poor because they don’t work hard enough, or that they enjoy being poor…

  6. oncdoc says:

    The elitists are the hospital and insurance execs, politicians and business owners who “can’t afford” to cover their employees. Most of them wouldn’t waste their time discussing any of this with a medical grunt like me. Our hospital ER is 30% uninsured but we find a way to provide cancer care for most. I do more charity in a week than most people do in a year!

  7. HouDoc says:

    @OncDoc,
    everything always comes back to primary care because all of the workload falls there, all the government mandates, all the pay for performance hurdles, all the family and patient questions about what the specialists did to them. The burden of the medical care system that we have falls to primary care, whereas specialist can and do easily pawn off the real work of dealing with the emotional needs of patients after whatever procedure is done back to the primary care physician.
    And to flippantly say that NP’s can do what primary care physicians can do shows how completely uninformed you are concerning day to day medical practice. I could make the argument that an NP and good computer program could dose/administer/ and monitor chemo therapy just as well as any oncologist without the added conflict of interest in getting paid to buy and administer the chemotherapy drugs as many oncologists currently do.
    Lastly, you are clearly ignorant of the shortage of primary care physicians in the United States and it is precisely because of the workload and lack of payment that this specialty receives that has lead to such shortages.

  8. oncdoc says:

    I spent a 4th yr as Chief Resident at my 110 Housestaff IM training program and practiced General Internal Medicine for 5 yrs before my fellowship in Hem/onc . During my IM practice, I got up every morning and rounded at 2 hospitals berfore clinic and went to a rehab center several times a week as well. Now, I attend 3 6:30 AM tumor conferences a week before rounds. I round every day and take weekend call regularly. Hospital consults are at least 20% no-pay. I practice in the same med center as before fellowship and my former partners refer pts to me. I know a few things about primary care medicine and greatly respect good primary care docs, but to be honest, I just don’t see the dedication that I had in the early days. I only know a handful of PCPs who even go to the hospital! I do as much if not much more paperwork than most PCPs and have yet to see one intervene in an end of life discussion. Once a pt has cancer of a serious blood disorder, “the real work ” of medicine is all mine.
    I stated that NPs “can fill a role” in primary care . I never said anything about replacing!
    We use NPs for routine care in our office and so far they have been a great help. The truth is that NPs can do alot of what we both do and technology will enhance that futher.
    Our “profit” on chemo is for the most part zero or negative for most regimens under Medicare and if a treatment isn’t listed in NCCN guidelines, forget about it.
    I started this discussion with my opinion of why docs don’t want to practice in rural areas and why a 5% increase in Medicare payments won’t change that!

  9. Josh Wilson says:

    The doctor shortage follows simple economics. The reason doctors don’t go to rural areas is because generally, the residents in rural areas rely on government insurance such as medicare and medicaid, and those programs drastically under reimburse physicians for services. As a medical student, I refuse to go to a rural area because of low reimbursements. The author of this article completely misunderstands the problem and basic economics. The 5% increase won’t do a thing. Medicare pays 40% less today than it did 15 years ago when adjusted for inflation. There needs to be between a 40-70% increase in reimbursements to really solve the physician shortage.

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