Orthopedists should consider patients’ perspective of Medicare

Issue: May 2005

ByDouglas W. Jackson, MD

Douglas W. Jackson, MD [photo] --- Douglas W. Jackson, Chief Medical Editor

Premiums for 2005 Part B Medicare covering physician and outpatient hospital services, in addition to some home health care and durable medical equipment, have seen some of the greatest percentage increases since the onset of the program. The top Medicare administrator said the 2005 hike results mainly from increased payments to health providers — about four-fifths to doctors and one-fifth to Medicare’s private managed care plans. These increases were authorized under last year’s Medicare prescription drug law. The drug benefit, however, does not take effect until 2006, and so those costs do not factor into the 2005 premium increase.

Opponents to the premium increase have pointed out that much of this increase has been given to health providers beginning this year. But such comments became moot last month when the Medicare Trustees Report for 2005 projected a whopping 26% reduction in physician payments over six years beginning next year.

These premium increases will affect all Medicare beneficiaries. David Certner, American Association of Retired Persons (AARP) director of federal affairs, said, “This is an unwelcome shock to the millions of older Americans who are struggling to make ends meet while living on fixed incomes.” This increase in health care premiums will essentially negate the cost of living (inflation) adjustments to social security checks for senior citizens. There are few things they can do to offset these increases. However, the AARP offered some advice for reducing health care costs in 2005 for Medicare beneficiaries in a magazine article (www.aarpmagazine.org), including the following:

Choose doctors who accept Medicare assignment, “to avoid paying more than the Medicare-approved amount.”
Obtain a Medicare—approved drug discount card.
Look again at Medigap policies to help with co-pays and deductibles.
Take advantage of tests and screening programs (ie, yearly mammograms and prostrate checks, etc.)

Continuous increases

Increasing premiums looks like a continuing prospect for Medicare beneficiaries as more services likely get added and drug benefits require increasing subsidies. What’s become increasingly clear is that there is a real economic disconnect between the steady demand by Medicare patients to have all their medical costs covered at a time when those in the work force see more deducted from their checks and greater cost shifting to them for their own health care.

Now look at a few of the latest findings on how continued cost pressures will affect physicians. Not only are physician Medicare payments proposed to drop 26% over six years (because of a complex, not particularly rational formula linking Medicare payments to overall growth in the U.S. economy), but physicians’ costs are projected to increase at least 15% during the same period. (See accompanying chart). That is simply not sustainable and the likely repercussions look bleak — for patients and physicians alike.

One out of 10 physicians say they would choose to retire if the first-year, 5% cut (of the projected six-year, 26% cut) in Medicare reimbursements takes effect next year, a new survey of nearly 5500 physicians by the American Medical Association (AMA) found. And 38% of the physicians polled said the 5% cut will force them to trim the number of Medicare patients they accept. That comes at a time when 22% of Medicare patients already reported trouble getting an appointment with a new primary care physician last year. The projected cuts will also hurt patients in rural areas heavily – where more than a third of the physicians who serve there now say they would be forced to discontinue rural outreach services if payments are cut as planned next year. Quality and efficiency will take a hit too: 61% of physicians said they would delay buying new equipment and 54% would put off information technology purchases when the cuts arrive.

ORTHOPEDICS TODAY

Source: Joseph B. Chandler

Patient confusion

It is confusing to many seniors why more and more physicians will not accept the “Medicare—approved payments” as payment in full. “Why are doctors wanting more?” is a question I hear discussed and occasionally asked of me by patients. We need to talk to our patients and health policy makers about the reform necessary in the years ahead. Health care costs will continue to increase along with demand for current and new technology and treatments. Today’s approach of price controls, cost-shifting to future generations, reduced payments for services and unrealistic promises will eventually fail to keep the system solvent. As this becomes apparent to more voters, it may force our nation to take the necessary responsible actions.

The changes needed will require patients of all ages to take more responsibility and accountability for their own health and health care costs. Any reform will need to deter over use, rationing of some of the non-essential medical services and a more direct relationship between the procurer of the medical services and the payer.

It appears in 2005 we as a nation are not ready to deal with Medicare reform and it will be procrastination and business as usual.

Douglas W. Jackson, MD
Chief Medical Editor