Why Doctors Are Opting Out of Insurance and Medicare

The evolution of medicine in this country has taken a huge turn for the worse. The U.S. has the highest healthcare expenditures of any country and has one of the worst outcome profiles (we are 37th worldwide and rapidly falling). Is this the fault of doctors who weren’t trained well? Is there something missing in our medical education? ABSOLUTELY NOT!!

I have been in practice for more than 40 years and I have lived through the worst degradation of any industry in America. How did this happen? Back when I went into practice, health insurance companies followed an indemnity platform. Patients went to a doctor. The plan paid 80% and the patient paid 20% of the bill. There were no ICD codes, no CPT codes. We handwrote what we did on the form. In those years, we were paid very well for our investment in education and training and most doctors could see 20 – 25 patients daily and have a very viable practice. There was plenty of time to render quality care.

But insurance companies are a money business. Not a health care business. What they created was a platform that could control medical costs by creating fee schedules. In order to be eligible for these fees, doctors had to sign participation agreements. In exchange, insurance companies listed your practice in their book of participating providers. Hence, doctors no longer felt compelled to spend money on marketing since patients were calling anyway.

As the system “matured”, insurance companies realized that they were now in control of reimbursements. They had signed contracts. Why not capture higher profits by reducing fees. And reduce, they did! Over and over and over until it became necessary to see a much higher volume of patients to make a living. Now, doctors were all caught up in the system. More importantly, patients were now conditioned to believe that ALL of their medical care would be delivered for a small co-pay. Once the conditioning had succeeded, it was time to capture even more of the premium dollars by creating treatment guidelines, prior authorizations, referrals from the PCPs, chart reviews, claim reductions and denials and high deductibles.

And that is how it has been for well over 20 years. The collateral damage here is obvious. To handle a lot more patients, doctors needed larger offices, bigger staffs and lots of ancillary help in running their practice. This translates into extremely high expenses. In addition, patients now have difficulty obtaining timely appointments and when they do, they sit in the waiting room for 2 hours and have a 5 minute appointment with the doctor who has to run to the next room. In a rushed medical atmosphere, it is easier and quicker to write prescriptions for drugs and spend no time delving into the underlying mechanisms that brought the patient to the office in the first place.

So how does this translate? Many patients are wholly dissatisfied with the level of care they are receiving. Patients with more complex problems are seen as thorns in the side of expediency and often fall through the cracks. The doctor-patient relationship has degenerated. More importantly, doctors are over-worked, extremely stressed out and struggle with enormous expenses that significantly reduce their income and undermines the level of education, training, sacrifice and continuing medical education requirements that they complete every year. And let’s face it, a stressed-out doctor is not at his diagnostic best.

Doctors are NOT happy. They are at odds with insurance companies on a daily basis. They are completely overwhelmed. It has become so untenable that many doctors are choosing to sell their practices to large health and hospital corporations so they no longer have administrative stress. However, as employees of a system, they are NOT in control of their practice, they still must see high volumes of patients and their salaries are unpredictable going forward. It is not the panacea many hoped it would be.

So what else can doctors do? Many are trying to keep their own private practices viable by going to a direct care (direct-pay) platform, where patients come to the doctor, pay the fee and are given superbills or claim forms to submit if they have out-of-network coverage. Now, the clear and obvious advantage here is that the doctor can see far fewer patients, significantly decrease expenses and offer a level of care far superior to what they were able to offer while accepting insurance. The patients benefit and the doctors benefit. It’s a win/win.  However, there is a couple of decades of conditioning that psychologically prevents people from accepting a direct-pay platform unless the direct-pay doctor is unique in his/her approach which will provide a compelling reason for people to pay out of pocket.

Either way you look at it, the public is at odds with their doctors. Doctors are blamed by patients for the shortfalls in the system. I cannot understand it myself. Patients should be railing against the insurance companies that created this mess in the first place and are the reason it keeps getting worse.

How do we change the system? There are two things that will work. Doctors must continue to drop out of insurance plans and go to a direct-pay platform. Without participating doctors, insurance companies have no power (clearly, they have wrestled the standard of care away from doctors) and the public MUST demand better coverage without all the hoops they must jump through just to get coverage. If not, don’t pay the premiums and consider a health share company that pays all the medical bills at a fraction of the cost and provides access to every doctor with a license (there are no participating doctors – it is completely open access).

Finally, and this is the most disconcerting, the crushing decrease in physician income and the out-of-control stress has made medicine a much less desirable profession. In the future, medical schools will have to lower their requirements to get students as the more intelligent and highly motivated students find their way to other professions. Thus, the future of medicine will be in the hands of less qualified individuals.