Thursday, April 15, 2010

When States Tie Conditions of Licensure to Insurance Payments

A bill currently under review by the state Senate in Massachusetts will make participation in the state and federal Medicare/Medicaid programs a condition of medical licensure, effectively making physicians employees of the state:
Every health care provider licensed in the commonwealth which provides covered services to a person covered under "Affordable Health Plans" must provide such service to any such person, as a condition of their licensure, and must accept payment at the lowest of the statutory reimbursement rate, an amount equal to the actuarial equivalent of the statutory reimbursement rate, or the applicable contract rate with the carrier for the carrier’s product offering with the lowest level benefit plan available to the general public within the Connector, other than the young adult plan, and may not balance bill such person for any amount in excess of the amount paid by the carrier pursuant to this section, other than applicable co-payments, co-insurance and deductibles.
So what this means is that in order for doctors to become licensed in Massachusetts, they will have to agree to accepting the payment rates imposed by the government, even though those payments may not cover their actual expenses for the care rendered.

Unbelievable.

My prediction: look for many doctors to move elsewhere.

-Wes

36 comments:

  1. Unbelievable is right.

    How would you interpret the phrase "must provide such service to any such person"?

    A new patient with state insurance calls at 5 PM on Christmas Eve, and you're obligated by law to treat them?

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  2. I'll never work in a state with this kind of law. If this ever becomes federal law and the legions of lawsuits fail to correct it, I'll quit working as a physician. This is nothing but slavery.

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  3. Bloody hell! Time to call my state senator; this is insane.

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  4. I wouldn't be surprised if the federal government tried to impose that requirement on ALL state licensing bodies.

    No matter that it would be unconstitutional.

    -Steve

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  5. The Constitution has hardly slowed them down so far.

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  6. Hey, under the 10th amendment, if the people of Mass want to bankrupt their state, God bless them in their efforts.

    Here's a warning for citizens of Mass leaving the state: Don't come to Oklahoma, we don't want your nanny state BS here!

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  7. This is the fundamental problem with occupations of common right falling under licensing schemes.

    Who could constitutionally be required to be licensed? Aliens and 14th Amendment citizens - since they do not have inalienable rights. The problem is the mal-application of licensing laws to people upon whom the law cannot operate.

    If we as a people only understood that the state has no business telling a man or woman how they may employ their labor.

    The benefits of being protected by the monopolistic licensing power of the state comes with many unsavory strings attached.

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  8. Dr. Parker, I don't think that Obama and this Congress worries very much about the Constitution. Soviet Russia had one of the best sounding Constitutions imaginable but meant nothing. Look what the Democrat/Socialists/Marxists have just done against the will of the people.

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  9. Kind of makes your eyes bleed, doesn't it? They will have to do this for the whole country, if we stay on the current trajectory. I'm not looking forward to that, but it's simple economics. If we're going to have unlimited free lunches, someone is going to be enslaved to provide them.

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  10. I would not get overly worked up. All this is is a bill before the senate...it is not the law and it may or not become the law and it may be challenged in court...every state has lots of bills under consideration that are just plain silly or dumb or non-enforceable. Why not wait till we see if the bill gets (1) passed, (2) passed and vetoed, (3) goes to a court for legality?

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  11. This goes beyond making physicians "government employees." Government employees generally have the right to bargain.

    Even in Canadian provinces, which have a single-payer system under which physicians are contractors, there exist entities whose sole purpose is to negotiate payment rates with the government. This MA proposal is just unilateral imposition.

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  12. Wow... that takes a lot of balls.

    Who in the blue f*ck do these legislators think they are?

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  13. It is long past time for physicians to grow some cojones and a spine. First, the AMA sold doctors out, cheap. Now doctors are not being paid by Medicare, and the SGR is not fixed, only another 2 week bandaid seems forthcoming. The AMA should be calling for all physicians to immediately stop seeing Medicare patients for all but emergent care. Federal legislation MUST be passed ASAP allowing all licensed physicians to accept Medicare and other "affordable" health plans while permitting balance billing. The right of patients to see a doctor of their choice and the right of individual physicians to set fees MUST be preserved. Anything less is unacceptable, unconstitutional, and impinges on the ability of patients and physicians to obtain or provide medical services. All physicians MUST UNITE in this effort or face a lifetime of involuntary government/corporate servitude.

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  14. I'm so sorry to hear this. I see a future with very few doctors.

    If medicare does not cover the overhead, why not take a tip from the airline industry and tack on extra fees?

    The fee that medicare pays would cover time with the doctor - but that's all. To actually get time with the doctor, first the patient would need to purchase a spot on the schedule - payable in advance. Just as airlines charge an extra fee for changes to the ticket, doctors' offices could charge a fee for changes to the schedule. There could be a check-in fee, a climate-control fee (heat or a/c depending on time of the year), a paperwork fee... This would not be balance billing, because the fee for seeing the doctor would be fully accepted; it's the other stuff that the patient would need to pay for.

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  15. I'm one of those damned fool socialist Euro's and even I can see how ridiculous this legislation is.

    I hope the Mass. media point out which fool attempted this legislation - maybe his health provider could add a bit of a levy to his policy.

    I would think the smart thing to do would be to see the lie of the land after the Federal legislation has settled, before making sweeping State health changes... but then I'm a liberal, what do I know?

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  16. Physicians - You and your patients need a replacement for the AMA. Docs 4 Patient Care is an organization working hard to become that replacement.

    What began as a grassroots group of physicians working for common-sense health care reform has quickly evolved into a movement to replace the AMA as the representation for America's physicians. They have gained solid recognition in the DC establishment and have gained members in all states and include all specialties. They recently established a Political Action Committee and work closely with Heritage, Galen Institute, and Tony Dolan (Reagan's speech writer).

    They are currently working on changing the physician membership part of their name to something more credentialed. They will retain the Docs 4 Patient Care label for allied health and concerned citizens to join the movement. They are also working on tweaking their website to make it look more professional.

    Please sign-on through their website doc4patientcare.org. You can also email me directly at jodi-carroll@sbcglobal.net if you have questions. I am one of their RN members working closely with them, and have traveled to DC with them as well. Most specifically, I am assisting in the Chicago area chapter.

    There is power in numbers - Please forget about being a cardiologist, or urologist, or neurosurgeon for a moment, and be a doctor. There are more doctors than there are people within your specialty.

    Read this article on the AMA:

    "Is the AMA the worst trade association ever?"

    link:

    http://www.youtube.com/watch?v=6QxPHVEE2NE&feature=player_embedded#!

    - Jodi

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  17. Doctors are always threatening to move elsewhere about everything. No one believes them anymore.

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  18. Dr. Wes,
    Take heart! State legislatures have some very weird folks who dream up some really weird bills. Now that you've gotten this crowd very riled up, please promise to let us know when the bill passes, IF it passes.

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  19. I conclude that most of your readers are convinced that licensing is a very fearsome thing and completely eradicates their constitutional rights. I wonder how many of them would bring their sick children to an unlicensed physician. I'd be interested in knowing if you think we should do away with licensing doctors.

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  20. Let's spread some of this wrath around (and worry less about the US devolving into a communist country). Do you know who backs this bill - The some MA association of Health Plans! Of course they would like to see the docs paid less. Duh! Does anyone else see that there may be some connection between their support for this bill and our beloved capitalism?

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  21. Fred -
    The time to stop foolishness is the moment it rears its ugly head, not a second later; better yet would be instilling in the legislatures of the states the sure knowledge that proposing such foolishness would result in immediate, continuing, and successful calls for the replacement of the foolish legislator who proposes it.

    Anonymous-
    Texas revised its malpractice law to cap "pain & suffering" awards at $250k, and since then more docs have moved into Texas than into any other state. Go figure - insurance rates are lower here now. Amazing how financial incentives actually work in the real world.

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  22. "Texas revised its malpractice law to cap "pain & suffering" awards at $250k, and since then more docs have moved into Texas than into any other state. Go figure - insurance rates are lower here now. Amazing how financial incentives actually work in the real world."

    Actually, that would be incorrect. Texas' physician population is still one of the lowest in the country per capita. If you look at physicians per capita, you'll mostly find noncapped states like New York at the top of the list. Why? Because professional services follow rich people, who can pay for those services.

    Ironically, the second or third most popular place that physicians moved to Texas from? California, which has had caps for decades. So clearly, caps aren't that big of a financial incentive.

    Insurance rates fell in capped and noncapped states nationwide at about the same rate. Why? Because insurer income is primarily based on their investments. Insurer profitability rises and falls with the economy. Most underwriting is written at a loss.

    And it would be odd for physicians to move for a slightly lower insurance rate, when you figure liability coverage makes up less than 10% of their overhead.

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  23. These bills are not enforceable.

    Mr Jones. I'm a Medicare patient. I need an appointment. You have to accept me. The law says so.

    Dr Smith. You're right Mr Jones. I do have to accept you. However, my next available Medicare slot is January 24th, 2013 at 6:30 am. Would you like me to schedule you today? And I can't guarantee to you that I will be in town that day, and you might get rescheduled.

    click.

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  24. @Anon 10:13
    I conclude that most of your readers are convinced that licensing is a very fearsome thing and completely eradicates their constitutional rights. I wonder how many of them would bring their sick children to an unlicensed physician. I'd be interested in knowing if you think we should do away with licensing doctors.

    I can't speak for most of Dr. Wes' readers, just myself. My only contact with the medical profession is as a patient (and mighty tired of being one, I might add). I carefully check the credentials of all physicians before I see them. The way things currently stand, I would take neither myself nor my children to an unlicensed physician.

    If a license to practice medicine means that a doctor's knowledge and skills have been evaluated and it was determined that the person appears to be a competent physician - and conversely, a lack of license means that the person is unable to demonstrate the requisite competence - then I definitely want my doctors to be licensed to practice medicine.

    That isn't what this is about. The referenced bill says that medical knowledge and clinical competence are irrelevant unless the doctor is willing to lose money for seeing patients.

    Most businesses evaluate their costs - facilities, utilities, supplies, labor costs, and so forth - then consider these factors in determining the prices they charge. Doctors are not allowed to do that. Doctors are saying that when they calculate all their costs, overhead for a fifteen minute appointment is $80 (for example-just a made up number), so in this case they need to charge $80 just to break even, and even more to make a profit. The bill is saying that doctors who won't accept $40 (for example) thereby losing money every time they see a patient will not be licensed to practice medicine in that state, irrespective of their clinical acumen. That is wrong.

    I don't know anyone in any business who would agree to work under such conditions. Doctors are not being unreasonable to say, "I can't afford to accept $40 for something that costs a minimum of $80 to provide." They simply will not be able to afford to do it.

    Sorry, Dr. Wes, for such a long comment

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  25. "(a) As a condition of doing business in the commonwealth, a carrier that offers health benefit plans to
    eligible small businesses and eligible individuals..."

    It says, "a carrier that offers" and "which provides", where does it say "MUST" provide services to persons eligible under the "Affordable Health Plan"??

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  26. It seems providers will still have a choice as to whether or not to participate in a "Affordable Health Plan" related network or plan.

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  27. If you'd bothered reading the link you would see: "A provider that participates in a carrier’s network or 33 any health benefit plan may not refuse to participate in the carrier’s network with respect to the 34 “Affordable Health Plan”."

    If you accept any form of insurance you are required to take this (along with the bogus payment rate). And rest assured if doctors started refusing all insurance they would just amend the bill to close that loophole.

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  28. Todd,

    Below is link to the actual document. But here is the sentence, which does say MUST:

    "Every health care provider licensed in the commonwealth which provides covered services to a person covered under "Affordable Health Plans" must provide such service to any such person, as a condition of their licensure, and must accept payment at the lowest of the statutory reimbursement rate, an amount equal to the actuarial equivalent of the statutory reimbursement rate, or the applicable contract rate with the carrier for the carrier’s product offering with the lowest level benefit plan available to the general public within the Connector, other than the young adult plan, and may not balance bill such person for any amount in excess of the amount paid by the carrier pursuant to this section, other than applicable co-payments, co-insurance and deductibles."

    Link:

    http://www.mass.gov/legis/bills/senate/186/st02pdf/st02170.pdf

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  29. I did read the link, I was just confused by the language: "...licensed in the commonwealth WHICH provides covered services to a person covered under "Affordable Health Plans" MUST provide such service to any such
    person, as a condition of their licensure, and must accept payment at the lowest of the statutory
    reimbursement rate"--it sounds as though providers would have a "choice" not to participate in such networks or plans; if you choose to provide covered services to a person covered under "Affordable Health Plans", then you MUST accept payment...yada yada.

    Am I misunderstanding?

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  30. I did read the link, I was just confused by the language: "...licensed in the commonwealth WHICH provides covered services to a person covered under "Affordable Health Plans" MUST provide such service to any such
    person, as a condition of their licensure, and must accept payment at the lowest of the statutory
    reimbursement rate"--it sounds as though providers would have a "choice" not to participate in such networks or plans; if you choose to provide covered services to a person covered under "Affordable Health Plans", then you MUST accept payment...yada yada.

    Am I misunderstanding?

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  31. Yes. The entire point of the bill is to force any doctor accepting any insurance in MA to also accept this plan.

    The author of the bill stated somewhere or other that insurance companies and hospitals have to take a hit so it's time for doctors to bend over too. They are well aware that nobody would otherwise sign up to take the plan.

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  32. Hi everyone.

    Generally good comments, but there are a series of errors.

    1. There is an international market for physicians. For example, the US State Psychiatric Hospitals are competing with the Canadian, Australian, Irish, British and NZ services. Physicians balance pay with quality of their life and hassles in practice. As most medical systems do not produce adequate numbers of doctors (there is only a certain percentage of the population who can do the job. Two thirds don't want to: at least 60% of those who do are girls, and they WILL go part time because they want to see their kids occaisionally) the US poaches from the 1st world, the 1st world poaches from the developing world...

    Oh, and NZ will take board eligible psychiatrists :-)

    2. Private systems will exist. If a state bans them (esp Mass) the state next door (NH) will have a mini industry in providing that kind of care.

    3. Traditionally, free care comes from doctors in training. That is what happens in the resf of the English speaking world: as a consultant I don't run the ward. My registrar (trainee) does and I supervise them. This allows me to spend time as an academic. It allows my colleagues to work in private.

    4. The cure for legislaive stupdity is to elect people who will repeal the laws. If that cannot work, leave, or have enough money to get private care (in canada, perhaps?) when you have a medical emergency.

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  33. There are few places in Massachusetts that aren't within an hour of another state.

    It sounds to me like NH, VT, RI, CT, possibly ME and NY stand to gain doctors from this nonsense.

    They can still provide care to MA residents, it's just the residents will have to do a little driving first.

    Maybe I can find a way to run a profitable medical bussing service....

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  34. Will all carriers be required to offer "Affordable Health Plans"?

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  35. "Dr Smith. You're right Mr Jones. I do have to accept you. However, my next available Medicare slot is January 24th, 2013 at 6:30 am. Would you like me to schedule you today? And I can't guarantee to you that I will be in town that day, and you might get rescheduled."

    Who are you seeing in the meantime? Don't private insurers base their reimbursements off Medicaid rates?

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  36. Anyonymous 05:54:

    The reimbursement rates of private insurance companies do not mirror Medicare rates, they only follow the highering and lowering rate trends.

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