The Cost of Health Care Education

From the Wall Street Journal today via FinAid.org: the average cumulative debt of doctors after Medical school in 2003-2004 dollars was $113,661 with 95% of medical students borrowing money to fund their education. Compare this to law grad students (LLB or JD) whose average debt was $70,933 (87.7% borrowing) or doctorate degree students($49,007 with 51% of students borrowing) and you get an appreciation for yet another financial pressure our young physicians experience when they complete school. Given these price pressures, how on earth can we justify decreasing reimbursements to physicians? But it's likely to happen. Fortunately, it appears the expected cut in reimbursement to doctors of 4.4% will been repealed this year and reimbursements will be held at 2005 levels, but realize with inflation, this "freeze" still represents a pay cut. So it adds insult to injury when one finds that Medicare has decided to roll over reimbursement to the next fiscal year as a budget-balancing tactic and delay reimbursements to doctors by nearly two weeks this September. From the American Academy of Neurology's website:

A brief hold will be placed on Medicare payments for all claims for the last nine days of the Federal fiscal year, September 22, 2006 - September 30, 2006. These dates do not refer to the dates of service, but to the dates that you would have normally received the actual payments if you filed a clean claim. Claims held as a result of this one-time policy will be paid on October 2, 2006, with no interest or late penalty paid to an entity or individual for any delay in a payment by reason of this one-time hold on payments.

This delay of payments will cause a deferment of $1.3 billion to be paid beginning in October 2006 which marks the beginning of government’s 2007 fiscal budget year. The policy applies only to claims subject to payment and does not apply to full denials and no-pay claims. These payment delays are mandated by section 5203 of the Deficit Reduction Act of 2006.

Times are gettin' tough in medicine on everyone, but especially young doctors. And you can bet these young physicians' bankers will still expect payment on their loans without a 9-day lag.

--Wes