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The Great [Healthcare] Insurer Fee Disconnect


JIM PURCELL at  The Health Care Blog

A message to health insurance CEOs, COOs, and CFOs.  I believe there to be a fundamental disconnect between typical health insurer provider reimbursement strategies and the long term good of our healthcare delivery system and its financing.

Let me give you some examples which I know, as a former health insurer COO and CEO, to be true.

Insurers still pay primary care physicians far less than most specialists.  That perhaps was a function of the RBRVS system adopted by Medicare to “measure” the demands of specific physician activities and pay accordingly.  Specialist activities were rated higher than primary care activities.  They were deemed more complex, often involving surgery and fancy equipment with more training needed, etc.  The gap between primary care and specialist reimbursement grew and grew.  And what happened?  Predictably, the best and brightest are avoiding low paying primary care.  Consequences?

  • Shortage and aging of primary care physicians who are needed to keep us from requiring the much more expensive specialist and hospital care
  • Oversupply of specialists resulting in overuse, because if you build it they will come
  • Keeping the focus on sick care, which is what most specialists specialize in, rather than well care
  • Devaluing E&M (evaluative and maintenance) activity, which is the heart and soul of the practice of medicine, requiring observation, patient knowledge, and perception
  • Not paying for needed counseling and monitoring, which means no one does it and there is no quarterback for a patient’s care
  • Many hospice organizations provide acute care for terminally ill patients in a setting that is far more patient and family friendly than a hospital based ICU, and at tenth of the cost.  What about this is there not to understand?  And yet, many insurers (including Medicare) negotiate with hospice organizations exactly as they do with specialists and other providers, trying to achieve reimbursement at the lowest possible level, without thought to whether that makes overall sense.  Consequences?
  • Shortage of hospice acute care facilities
  • Longer hospice eligible patient stays in hospital ICUs
  • Bloated end of life expenses that could be mitigated
  • Significantly worse patient experience
  • Worse outcomes (and I’m not talking about death, but rather quality of life while still alive)
  • Commoditization of acute care undifferentiated as to its cost
  • Virtually the entire insurer response to behavioral health office visits and counseling is contrary to common sense and the good of the system (financially and otherwise) and its patients.  Insurers squeeze office visit reimbursement, limit the number of office visits, and often resist collocation and integration of behavioral and physical health.  They underpay psychologists and clinical social workers, the front line of counseling. They overpay psychiatrists, who largely are prescribers of meds. Consequences?
  • Mental health parity remains largely a myth in reimbursement, despite claims to the contrary.
  • Limits on behavioral health office visits do tremendous harm.  Behavioral health patients do not overuse office visits!  And limits create emergency situations, particularly during end of year holidays, that glut emergency departments and do tremendous harm to patients
  • Still no collocation and integration of behavioral and physical health
  • The best and brightest become psychiatrists who seldom counsel.  They dispense medications and “monitor.”  All at over inflated costs.
  • Tremendous shortage of professional counselors and burn out of those who are in the field today, because at today’s reimbursement levels, they can’t pay their own bills
  • Insurers paying physicians for telemedicine patient consults (“visits”) at 50% of a regular office visit.  Consequences?
  • Physicians resisting telemedicine visits which are clearly needed, particularly for the elderly and chronically ill for whom travel is a hardship
  • Missed visits and consults that should be occurring
  • Exacerbated inconvenience for patients
  • Lack of recognition of the added cost and hassle factor of technology and other expenses and work flow changes needed for telemedicine and potential additional malpractice exposure
  • Fewer “maintenance” and counseling sessions which are badly needed for the chronically ill
  • Greater emergency room and inpatient use overall

the whole post is here

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