The invitation looked harmless enough. One of Chicago’s largest health insurance companies was coordinating an evening meeting with physicians to discuss “the future in healthcare.” I knew this was coming. For the past few months, insurance companies had been conducting staff meetings at the larger medical groups to give physicians a reality check on their futures.
At this particular meeting, everyone was pleased that cocktails were being served to numb the inevitable blows. (When insurance companies organize smaller meetings of physicians, especially those that follow an audit of their medical records, there is no alcohol, just plenty of water bottles for everyone’s dry mouths.) At the very end of the presentation, when all the insurance company cards had been laid before us, I thought to myself I’d never heard anyone speak from a podium for an hour and at the end receive neither polite nor scattered applause.
The speaker at these evenings is always a physician employed by the insurance company. His/her title is medical director (I begin to think there must be dozens and dozens on their payroll) and he always begins by reassuring the audience that he was in clinical practice himself so he understands something of what physicians–especially primary care physicians–are facing. I view this physician more as a “Judas steer,” the animal that leads an innocent but doomed herd of cattle through the slaughterhouse corridors to the killing floor.
Dramatic changes ahead
In the most pleasant delivery possible, and with an occasional knowing chuckle, the medical director told us we should expect some pretty startling changes to the health care delivery system. Since all this affects you, the patient, let me share some key points, including some additional details garnered from conversations I’ve had with physicians who attended their own meetings.
- The health industry hopes that individual medical practices and small medical groups will ultimately disappear from the landscape by being financially absorbed into larger groups owned by hospital systems. It’s more economically sound for the insurance industry to deal with several large medical players than thousands of mom-and-pop operations. A health care consultant specializing in these mergers and acquisitions told me her firm was unbelievably busy, that small practices were being vacuumed up all over the country. In this construct, doctors who’ve owned their practices for decades sell to a mega-group and become employees.
- With the merging of her practice and doctor as employee, the nebulous “practice style” she’s developed over the years vanishes overnight into a standardized one, molded to the guidelines of insurance company medical directors who are, in turn, employees themselves. The doctor may be mortified by this, but is helpless as she’s likely cashed a sizable check and signed pages of binding contracts. The ultimate decision-makers in these vast systems are called health care executives. They’re usually non-MD MBAs, and we doctors refer to them as “suits.” Unless you cross them the wrong way (in which case reading up on witness protection techniques might be a good idea), health care executives are quite pleasant and very well dressed. Little wonder. They take home enormous salaries and stock option bonuses.
- The name of the game now becomes low-cost standardization of medical care. Physicians are expected to spend a limited amount of time with each patient, and are encouraged to see as many patients as possible during a workday. The insurance companies, sometimes with the token cooperation of a few physician-employees, create vast books of patient-care guidelines to which they believe their physicians must be “accountable” (remember this word, it will crop up again). These guidelines might mean documented Pap smear and mammogram frequency, weight management and exercise, colonoscopies for patients over 50, and getting that evil LDL (bad cholesterol) below 99 by any means possible. At first blush, creating such guidelines might seem reasonable, were it not for the annoying fact that patients are unique individuals and not one-size-fits-all Kmart socks.
- As a test run, the insurance industry, large hospital systems, and government jointly created a healthcare delivery system called Accountable Care Organizations (ACOs). They’ve tried it with certain Medicare patients, liked what they saw in terms of both savings and patient surveys, and now ACOs will be the health care of the future. To cobble together an ACO, hospital management (or a very large medical group such as Northwestern or Advocate), speaking for its salaried physicians, contractually agrees to provide all health care (primary care, specialty referrals, hospitalizations, etc) for a certain patient population–say Medicare recipients, employees of a particular company, or members of a union. For this, the hospital is paid a very large sum annually from which to fund the health care of their enrollees.
- If the prescribed guidelines are followed by physicians (i.e., physicians do what they’re told) and there is evidence, based on chart audits, that patients are getting “better,” then, in theory at least, health care costs will go down. If this scenario occurs, all the money paid at the onset of the project will not have been spent. The leftover cash is then divided among doctors as bonuses. On the other hand, if audits reveal a doctor’s patients are more costly than those of her colleagues, her salary for the year goes down. Let me stop here for a quick word about insurance company audits of your charts and privacy: there is none. When you enrolled in your health insurance program, one of the documents you signed allowed the insurance company to audit your chart without restrictions. Electronic medical records simply make the process, once done manually, technically easier. If you feel slightly nauseated by this, don’t worry. The insurer is looking at documentation, at cost numbers. They aren’t interested in you as a person.
- Let me reiterate this point. If the chart audit system discovers that a physician, for whatever reason, is an “outlier”–that she’s either not following the guidelines exactly or not getting the results anticipated for her patient population—she’ll be financially penalized. A quick example of what might occur: if your LDL is 115, you may be on the receiving end of a statin sales pitch from your doctor, not because bringing it down to 99 will improve your longevity, but because your refusal to do so will impact her financial bottom line.
- At first blush, you might say, “I think care should be standardized and physicians held accountable if they fail to comply with the guidelines of good medical practice.” Except, of course, the subtext of “standardized” always includes the unspoken “spend less money on the patient.” Thus, a doctor might be financially penalized for recommending nutritional counseling to lower cholesterol (“counseling is expensive”) instead of writing a generic statin drug (cheap). Or recommending psychotherapy (“therapy is very expensive”) instead of generic Prozac (cheaper than M&M’s). Or referring patients for massage, acupuncture, or even chiropractic (“expensive, expensive, expensive!”) instead of pushing an over-the-counter antiinflammatory (free to the insurance company, as it’s OTC).
- You might be saying “Isn’t this just like that HMO I was in once, but with bigger operators? When I was in an HMO, all I heard my doctor say was ‘sorry, you can’t have that.’” Yes, Virginia, this is just like an HMO, but with one major difference. If you hated your HMO, you could opt out and spend more money for good old-fashioned fee-for-service PPO (preferred provider organization) coverage. These were doctors who agreed to accept the insurer’s fee rate, but still had the freedom to order tests and drugs they chose themselves and weren’t penalized for doing what they thought best for you. The only problem? This PPO opt-out is headed for extinction.
- Let me close with a best-as-I-recall quote from an insurance company medical director. “We can no longer afford to pay for health care under the PPO model. Our plan is to phase out all fee-for-service care during the next few years. We’ll pay you doctors a finite amount of money to take care of a defined population. We tell doctors, ‘Don’t spend much money and you can keep the difference. Period. Don’t follow guidelines, and you’ll be leaving behind some serious money on the table and we’ll just take it back.’”
One physician piped up, “It’s one thing to have a healthy population of patients that never complains, follows all the rules, takes their generic medications, and never questions anything. But what about the non-compliant patients who won’t take the meds, don’t eat well, don’t have mammograms, continue to smoke? And what about super-health-conscious patients who want their vitamin levels measured and want referrals to acupuncturists?”
Another physician answered wearily for the medical director (who didn’t disagree): “You’ve got to fire patients like that. Get the non-compliant and the super-demanding out of your system. They’ll drag your numbers down. Hit your personal bottom line.”
Hey you, patient. Yes, I mean YOU. Pink slip time! Canned! Take your medical records and don’t let the frosted glass door hit you in the…on the way out.
Be well,
David Edelberg, MD
[…] to dictate their economics, so they may decide to leave them as stand-alone entities. From a post at Whole Health Chicago (emphasis […]
How. Obamacare Policy Holders and Big Pharma Lose Out from Insurers Gaming Plan Designs | naked capitalism
[…] being told of the Brave New World that is about to be visited on them. One account came from Whole Health Chicago. The writer, Dr. David Edelberg, describes a recent presentation by a large insurance company. […]
Yves Smith - The Stealthy, Ugly Growth of Corporatized Medicine - PRN.fm - PRN.fm
You really must read this paper and the several following links, which I think, lays out how the free trade agreements are behind all that is bad about healthcare in the US. There exists a very imminent danger because of investor-state provisions in these FTAs, which have the potential to trap us, the US in bad healthcare forever with no hope of escape. Perhaps the drama of the last six years has been a cover up of the FTA’s – At the very least, healthcare has been overshadowed by the extreme limitations imposed by an extremist US neoliberal trade policy and US corporations aspiratios to export all that is bad about healthcare in the US elsewhere. To do this they need he US to remain under the yoke of the privatization is the only future meme. The last 6 years may even be a cover up of these facts- that the politicians basically sold and are selling away our rights even now through these FTAs, which must be repealed and re-evaluated. Read
The potential impact of the World Trade Organization’s general agreement on trade in services on health system reform and regulation in the United States. [Int J Health Serv. 2009]
CS
[…] being told of the Brave New World that is about to be visited on them. One account came from Whole Health Chicago. The writer, Dr. David Edelberg, describes a recent presentation by a large insurance company. […]
The Stealthy, Ugly Growth of Corporatized Medicine | naked capitalism
Fee for Service HAS problems. Accountable Care Organizations or other forms of “Here is $, you take full care of X” (either bundled payments per condition or $ per population) have the potential for lawsuits. How many lawyers are eager to say “You earned how much more profit by denying my poor client this life-saving (drug / procdedure / specialist)?” Anybody who feels they should have been provided more expensive care will have a sympathetic jury once the jury learns savings from denied care flow to the doctor.
Dave Houg
This is not about Obamacare, in fact, Obamacare will help reduce some of the COPRORATE medicine mess … This has gone on for at least 20 years … Corporations have been purchasing hospitals for years and forcing Dr. to sell out or lose Hosp privileges and in order for new Dr. to get hired they are being trained to Dr. BY THE BUCK – the health care and cost have been going down hill for at least 20 years and the propaganda being sold as medical care is astounding – not only has this been happening in the Med Community it is going on in Dental, Eye, and Veterinary care – and everyone is trained to support this rip off! Your wallet is being robbed!
Debi Sue
[…] strongly encourage you to read this post from Whole Health Chicago (hat tip Lambert) in full. It shows how the future of American medicine […]
Coming Corporate Control of Medicine Will Throw Patients Under the Bus – Truth | General Insurance Guide
As a patient of limited means, I was fired for not being able to continually afford expensive, to me, lab work every 3 months or so. And, they wanted me on many drugs, though I’ve had high LDL and Tri’s for years, due in part to Atenolol. In rural Iowa, they at least pointed me to a free clinic some 30 miles away. Oh, and the Jefferson quote? That is fabrication. He never said that or anything like it; Go to Monticello.org for all things T.J.
Edwin Eberlein
If your government is big enough to give you everything you want, it’s big enough to take away everything you have
Thomas Jefferson.
Kathleen Cullen MD
It’s a subtle form of genocide….
Kathleen Cullen MD
Excellent article! I retired from the phama business in 2008 (when many doctors could still decide what drugs they wanted pts. to have. So my question is, why would anyone want to become a physician now? Study and work for all those years to be told what to do and how to do it. Cookbook medicine!! Good Bless the doctors that stay independent.
John
Our plan through my employer is already there. I am paying in full for healthCARE with WHC since the network will have none of that independent stuff.
Hey! General Foods, Monsanto, and others have shown how to wonderfully feed the world. Let’s do it for medical! – providing not medical care but medical treatment – just as mega-food monsters provide food, not nutrition.
Mark
Thanks for the info David.
1984 is here. I didn’t realize that insurance companies were having such a tough go of it in our economy that they need to install these draconian methods. Man. David I hope I wake up and realize this was just a bad dream.
Jeff Lupetin
This is what happens when your country is run by the mafia.
Of course, if enough people opt out and refuse to play ball the whole mess will unravel.
steve from virginia
That’s a lot of blame to the insurance companies without placing a big portion of the blame to the new health care law/Patient Affordability Act. CMS creates the rules for Medicare, paving the path for Medicaid and private/commercial insurance. Once again the government is making the rules, not us healthcare professionals…and the insurance companies and big pharm scramble around governments new “rules and laws” to comply and profit. The same government who controls farming, makes it more than difficult for organic farmers to have a durable business and promotes genetically modified cancer-producing foods. Keep allowing the government to make “healthcare” decisions and the biggest losers are us-the medical professionals and worst of all the patients. Free healthcare? Yea, ya get what ya pay for…and sometimes a lot less!
Cynthia Cunningham
Hi Dr. Edelberg,
So well said. What about direct pay practices? Do you think the strategy of High deductible with HSA account strategy I encourage my patients (who pay at the time of service) to follow, will hold up through this time? It’s the only way I see that can allow us to treat our patients with personal attention. Dr. Paul
Paul Schattauer M.D.
This is why many of us didn’t want Obamacare! My insurance rates TRIPLED and now ill end up with an HMO. BCBS is already horrible as a PPO. I can only imagine what’s to come. I looked into how Obamacare will change my coverage. Nothing will change except the rate hike and less prescription coverage. It’s the insurance industry that needed the overhaul!
Bec
I agree – it would be good to know, for those of us to speak as well as listen, what % of this is due to regulations coming out of Obamacare? It seems to me that this was always in the works, since it makes everyone richer but patients.
Hell, I’d like to know one more thing. If patients pay into the system to receive this standardized healthcare, and they do exactly what they are told and help the System spend less… why aren’t they getting some of the extra dough [back], instead of only execs and MDs getting richer?
Cherie
I have happily left several years ago. Take control of your own health and you WON’T get sick. Oh yeah buy a medical device in Japan which produces Kangen Water. Change Your Water Change Your Life!
Mary Cavanaugh
HA! Return of the faith healers. They lost business with the advent of penicillin, but they may be on the rise again.
Addie
The Corporate Machine consumes…. US!
Welcome my son, welcome to the machine.
Where have you been? It’s alright we know where you’ve been. What did you dream? It’s alright we told you what to dream.
R.D. Lang
Dear Dr. Edelman,
I can imagine this is very disconcerting to doctors, much the way we patients felt about about HMOs. Is this the result of Obamacare? Do you believe concierge medical treatment will be an option for those who can afford it?
Sincerely,
Nancy Kelley ( aunt of Casey Kelley, who works with you.
Nancy Kelley
More evidence we still need actual health care reform. When this happens I think more and more patients will just opt out of seeing a doctor until it is an emergency. We know that often nutrition and supplements work as well or better than drugs, so we’ll just self-medicate rather than be forced on statins or whatever. And that ultimately will not be good for patients or doctors or the system as a whole.
It gives me a little hope that there are some doctors like you who aren’t just falling in line like sheep. Oh, to live in any other first world country when I get sick…
John Pearson
I can tell David that “going vegan” will help some, but not others. This is a foolishly simplistic approach. Didn’t you read the article? A one-size-fits-all approach doesn’t work. Everyone is different. I’ve been a doctor for 25 years, and I will tell you the rule of thirds as it applies to patients: 1/3 will be okay no matter how hard they try to kill themselves, 1/3 will have poor health (this means over a lifetime, not just when young and apparently healthy) no matter how hard they try to take care of their health, and 1/3 have modifiable risk factors for various diseases that can really be helped by modern medicine and appropriate diet, not smoking, etc. But you should all be terrified by this article. It’s the DOCTORS who may vote with their feet and get out of third-party payor medicine, or get out of medicine altogether. And it will be YOU who suffers as a result.
JMDinOKC
This is a wonderful description of coming changes–funny and informative. In addition to alarming.
Here’s a question I have: how much of the change is due to Obamacare, and how much would have happened anyway? Any idea?
John
This is practically suicide, very scary.
Mary
HI Dr. E. As always, VERY profound, intelligent, brilliant and well written article of the awful facts. This is just a travesty. I am very sorry for all us patients and human beings as God created us, and also for caring and brilliant doctors as yourself who really really want to practice medicine the RIGHT way and HELP people!!! That is why brilliant and wonderful docs like you end up throwing in the towel to the rest of the dummies and get out of the profession. Sad for all of us who lose you. Blessings in the Lord.
Peggy A Wolf
It is frightening when @ age 69 & retired, the rules are being changed. I noticed that my secondary ins. card has “PPO” on the front. Now I can look for a “new” card in the mail & continue to exercise & eat more veggies. I wish they’d go for the GMO products w/ the same vengeance.
Diana Argersinger
Cheaper than M & M’s? Hilarious!!! I enjoy your writings because you bring the facts down to an understandable few paragraphs. Thanks Doc!
Diane Engelhardt
Frightening!
Dr. David Bailey (DC)
What can patients DO to combat this? What can be DONE?
Susanne Sklar
Want to avoid doctors and lawyers? Ok, I haven’t figured out lawyers yet but you can drastically reduce your reliance on the medical profession. Go vegan. Cut out the animal fats and proteins, eat a high fiber plant based diet and exercise. Otherwise, you will not only get sick eating animals, but as the good doctor just explained, the medical profession/insurance industry will treat you like one.
David