Wednesday, August 09, 2006

Doctor Cuts Spell Trouble for Medicare Patients

If I asked Americans of all shapes and sizes to take a 5.1 percent cut in their salary in 2007, how many would continue to work in their job? Most would say: "Time to move on."

Doctors are facing just that scenario: a 5.1% cut in reimbursements for Medicare patient services beginning in 2007. Medicare patients, by far the most numerous and vulnerable, will no doubt be refused entry in practices where they once were welcomed.

I fail to understand the logic of Medicare officials cutting physician's reimbursements as a means to control costs. It's like owning a business that writes computer software and deciding to cut the salaries of the programmers that build the software on which your company exists. Will all the bureaucracy and overhead with medical care today, these Medicare officials should consider the following:

  • Since 1977 to now, there has been an exponential growth in the number of hospital administrators compared to a near linear growth of physicians during the same period.

  • Hospital administration costs represent approximately 25% of the health care dollar spent.

  • Physician's Medicare reimbursement rates have consistently failed to keep up with the rate of inflation.

  • Malpractice expenses have risen nearly 30% in the past three years for most physicians.

Since admistrators are not on call 24-hours a day and typically work 8 to 12 hours per day based on their salary, I have a suggestion for making rapid, deep cuts in health care spending based on the number of hours worked: remove one half of all admistrative officials at each hospital, insurance agency, collection agency, patient survey company, and the like. Or perhaps more provocatively, cut their salaries by 5.1%.


1 comment:

Anonymous said...

I am Medicare-only insured and I agree with you completely. Though I've been retired for over ten years I've had no primary physician and have not used Medicare at all until I fell and broke my hip in May. I recieved excellent care at the hospital (and told after numerous tests that I'm in "excellent health") and am nearly fully recovered. I will not seek a doctor who accepts Medicare because I know very few do in my area, and there are many retirees depending on them.

I've written the Congress critters who represent me and demanded they defeat the cut. It's ludicrous. Better to cut the perks the critters give to themselves on our tax dimes! Doctors, though, are worth every penny they can earn in my opinion.