By ROB LAMBERTS, MD
Things have been busy in my absence. A recent post on Kevin MD by Joseph Biundo, a rheumatologist, challenged my assertion that primary care doctors can save money:
(In reference to my claim) That may be true in theory, but I see patients in my rheumatology office every day who have been “worked up” by primary care physicians and come in with piles of lab tests, and x-ray and MRI reports but are diagnosed in my office by a simple history and physical exam.
Prior to that, an article in the NY times along with a post by Kevin Pho noted the fact that more solo practitioners are leaving private practice and joining hospital systems. Why are they doing this? Dr. Kevin suggests the following:
Lifestyle matters. More doctors are entering the workforce seeking part-time jobs in order to maintain a family balance. By removing the administrative hassles from their plate, they can go back to focusing solely on practicing medicine and coming home at a reasonable hour.
The NY Times article suggests possible benefits to patients:
In many ways, patients benefit from higher quality and better coordinated care, as doctors from various fields join a single organization. In such systems, patient records can pass seamlessly from doctor to specialist to hospital, helping avoid the kind of dangerous slip-ups that cost the lives of an estimated 100,000 people in this country each year.
So as a primary care doctor in private practice, am I soon to go the way of the dinosaur? Is this simply a shift in the business model as demanded by the times, or should people be concerned? Would the system function better with fewer primary care doctors or ones who are employed by large hospital systems?
Those who read my blog regularly (and those clever enough to read the title of this post) already know my answer: private primary care is essential for a healthy healthcare system.
Why Primary Care?
While I can’t disagree with Dr. Biundo on his point regarding the physical exam skills of PCP’s, I do disagree that this raises question of the cost-effectiveness of primary care. In his case (the practice of rheumatology), there are few expensive procedures, the diseases are less common (compared to fields like cardiology and other high cost specialties), and the patients don’t spend a high number of days in the hospital. One overnight stay for a cardiac catheterization will pay a large part of a rheumatologist’s salary for a year.
Like primary care, rheumatology is largely an outpatient practice, with success being measured by the ability of the practitioner to keep the patient out of the hospital and away from expensive procedures. Lately, rheumatologists have started having biologic medications (like Enbrel) that are quite costly, but the number of people on this relative to the general public is still quite small.
Primary care, on the other hand, is the fountainhead of all healthcare costs. A good PCP is also measured by patients staying out of the hospital and away from expensive procedures. In general, a PCP is less likely to:
- order an x-ray compared to an orthopedist
- get an EKG compared to a cardiologist, or
- order an endoscopy compared to a gastroenterologist.
There are some high-consuming primary care doctors, but much of the blame for this can be placed on the payment system that encourages expensive procedures and the ordering of tests. For example, one of the PCP groups in our area has their own stress-testing equipment and CT scanner. I am 100% sure that the physicians in this group order many more CT scans and stress tests when compared the physicians in my practice. I am also sure that the care quality in my practice does not suffer from our lack of test-ordering. Why? Because the physicians are financially motivated to order these tests, making the appropriate business decision clash with the appropriate medical decision. As long as it’s not harmful to order the test, the doctor can justify it.
Even these physicians, however, are not going to do any of these tests as much as a specialist, who depends on the presence of chronic disease to make a living. The only specialists I have seen who are slow to order tests and procedures are those who don’t financially profit from their ordering: academic specialists.
Why Private Practice?
This brings me to my second point, which is the necessity of having primary care physicians who are in private practice.
Why do hospitals have an interest in hiring primary care physicians? The answer is twofold: first, they allow them to negotiate contracts with the insurance companies in a position of strength. Primary care is a must for most insurance contracts. Patients will change insurance plans if their PCP is not on the plan, but they won’t do so nearly as much for specialists (with the possible exception of OB/GYN, which often act as PCP’s) or hospitals. Plus, most insurance plans do their care management by requiring referrals, denying or accepting them being their means of cost control. Primary care physicians are the referring physicians, and without them the hospital’s negotiating power is greatly diminished.
The second reason hospitals want PCP’s under their wing is that they generate business by ordering radiology tests, lab tests, and sending patients to specialists who will do expensive procedures in their facilities. Primary care is a loss-leader to hospitals. Hospitals make no money off of their PCP practices directly but make a huge amount from the referrals and procedures they generate.
This shifts the mission of the PCP. The “success” of the PCP in the eye of the hospital system is not to avoid referrals or costly procedures, but to order them. It’s not bad in the eye of the hospital that the PCP has higher hospitalization rates, it is better.
The Answer
The solution from an overall cost standpoint is to give primary care physicians incentive to do what they should be doing in the first place: keep people healthy and away from hospitals. Any system that places too much value on procedures is going to fail at this, as the institutions and individuals who profit off of the procedures are going to fight for control of PCP’s. Independent PCP’s who profit from keeping people well are the best thing for a system.
I have lived in both worlds: as a private PCP and as a salaried physician from a hospital. I left the latter because it was clear that they had no interest at running my practice well and really just wanted me to be a turnstile into their money-making procedures. It would be a big mistake to take away the one specialty that restrains cost. We need to do the opposite, and encourage good primary care medicine.
Rob Lamberts, MD, is a primary care physician practicing somewhere in the southeastern United States. He blogs regularly at Musings of a Distractible Mind, where this post first appeared. For some strange reason, he is often stopped by strangers on the street who mistake him for former Atlanta Braves star John Smoltz and ask “Hey, are you John Smoltz?” He is not John Smoltz. He is not a former major league baseball player. He is a primary care physician.
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Good work ! Keep us posting.
I would like to know where an individual could search and find part time positions for PCP.
I know many PCP’s that have had it and have no faith in the government going forward regarding America’s health care system and they want OUT! They want quality of life and balance, NOT more $$$$$$ and Bureaucracy.
There is actually a vast revenue of primary care physicians, of whom 99% are in private practice, provide highly cost-efficient health care, and the usage of whom has been shown to reduce the need for more expensive interventions.
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It’s amazing how few private PCPs realize their power. They are the routers for patients to the lucrative specialist cobweb.
Smart PCPs are build alliances with their specialty referral patterns all the while adhering to STARK.
Is a minor in business needed in med school for PCPs to survive?
I think it is important to define out need for primary care phsyicians. Our healthcare system needs to be more proactive, rather than reactive. The article mentions how PCPs try and keep patietns healthy and out of hospitals. While I respect the expertise of specialists, I often feel they order unneeded tests and this leads to increases in healthcare costs. For decades, the PCP treated all ailments the patient presented with. I do agree that incentives often drive behavior, and if we need to provide PCPs with incentives to keep patients healthy, then we must do so.
OK, sorry I am late to comment on comments. I actually would be just as reluctant to join with subspecialists – maybe that’s just my bias from my position, but the hospitals and specialists are on the consuming side of health care. In other words, they benefit from more procedures, more sick patients, and more care. Primary care (and specialties like rheumatology, endocrinology, and other non-hospital specialties) are the opposite. If I am paid more to profit my group most, then I am motivated to use medical resources more. Our system has to only encourage use of resources when appropriate. For example, should all chest pain get a stress test? Should all abdominal pain get an endoscopy? I think this is a core problem for the doctor of any practice that profits from over-use of resources – even primary care docs allied with specialists.
I stand by my assertion that the system is best served to encourage the existence of independent primary care. This may involve the banding together of groups of PCP’s, but once docs are given incentive to consume, they will do so. The system encourages this and that is a large part of why we spend so much.
There is actually a vast revenue of primary care physicians, of whom 99% are in private practice, provide highly cost-efficient health care, and the usage of whom has been shown to reduce the need for more expensive interventions.
I wrote about this in some detail at:
http://www.averyjenkins.com/?p=84
oh, and James, you actually think Matt has anyone moderating this carnival? Where on earth would he find time or energy to do that, after nomming down all of that Parisian snails & champagne?
Nate,
what’s your take on Section 10104 of the new health law? Qliance seems to think it addresses your PCP capitation suggestion:
Also, I’ve never seen nor heard of the ERISA bar to PCP capitation that you referenced. Can you provide chapter & verse?
Has anyone looked at how Scott & White in Texas? As an integrated system, they somehow seem to make this all work. I note they also have a health plan, which might be a factor in their institutional self-discipline regarding highly effective care. Their Dartmouth scores are impressive (Central Texas is an island of low Medicare costs).
Also, to the admins, is there any way to implement a spam flagging system for the comments? There seem to be more of these “ads discuised as posts” lately.
Nate – Those are all good points. I’m not clear, though, on the definition of episodic care. I understand that a hip replacement, CABG or other surgeries are episodic. What about a screening colonoscopy or an MRI to try to diagnose or rule out a problem? Both could be considered part of sound medical management or they could be done to drive revenue, especially the MRI’s.
It’s also interesting to note that in Massachusetts, investigators found that care delivered under capitated payments sometimes cost more than the same care would have cost if it were paid on a fee for service basis. So, capitation is not necessarily the complete answer either, but I agree that it would probably work best for primary care. I know that PCP’s in the UK are paid a fixed amount per patient per month with the opportunity to earn bonus compensation based on how they perform on a wide array of metrics. Oddly, British PCP’s earn more than their U.S. counterparts since the pay for performance scheme was implemented.
This is really interesting take on the concept. I never thought of it that way. I came across this site recently which I think will be of great use http://www.dnaperfection.com . Have a look!
While a large multi speciality IPO can work in large population centers what does the rest of the country do? When there is only 1-2 doctors in town is there still an advantage to partnering with other docs hundreds of miles away? What works for/in CA, NY etc isn’t going to work in Montana.
Barry do you think capitated primary care is viewed the same way as capitated hospital care or speciality? Fee for servie works for care that is episodic. Primary care on the other hand is probably the only care that makes sense to capitate.
A nice trial would be to add a section to ERISA allowing PCPs to accept capitation without the presence of an HMO license. If the market was a little freer we could try some of these things.
Good post, we BTW use patientsurvey.com for keeping a tab on patient feedback. Works out well. Makes the staff also think twice about how they treat patients. Also, this is helping out to let go staff who are not doing a great job. What better way to document something than something that is provided to you by patients themselves. Plus, all staff wears a name tag just to make sure they know patients can see who the person is.
Also, doctors are now reviewing these every month as well. They get positive and negative feedback about how patients feel about their treatment at the hospital.
In the end only thing that matters is the patient care and preventative medicine.
Keep up the good work. Great content!!!
Regards
Dr. Handley,
In theory, capitation is better than fee for service payment if the goal is to control healthcare costs and utilization of services. Does your practice accept capitated payments? If so, how successful is your group at estimating your costs a year in advance so that you can negotiate a capitated rate that will ensure that your group’s doctors earn a reasonable income / profit? Second, what do you tell patients who are concerned that capitation creates an incentive to deny care that may well be necessary and appropriate?
The technology has falsely elevated patients’ hopes that they can make ongoing poor choices in lifestyle and just commit to “arrive when I can’t thrive” mentality of seeking care. PCPs/Family Docs/Internists should consider taking a stand and when starting a practice or seeing new patients, get them to sign some type of “contract”, not fully binding as you can’t refuse care, but set limits how you can maximize it to assist patients in maintaining the best health they can pursue.
And if you do this, you could survive as a private pracitice WITH TIME, as you are setting responsible and appropriate boundaries and develop a practice that would be viable and worthy. I think there are a sizeable number of patients who, when called on it by a doctor who genuinely cares and explains the boundaries and expectations by the doctor are to enhance care, not limit it, will try to work with such a doctor.
By the way, you might consider another picture for your posting. And no, not a John Shmoltz picture, but one that has an air of professionalism that sells you as a provider. And be sure to smile!
from a specialist who tries to do this but in my specialty, I have less flexibility to set limits.
As has been pointed out by Dr. Handley, the choice is not private vs. hospital owned. Anyone who has worked around health care for any length of time knows that hospitals are notoriously horrible when it comes to integrating with physician practices. Practices are to be “controlled” or “managed” and as you point out the incentives are screwy. On the other hand there are a host of other models for physicians to come together in multi-specialty (or even large primary care) groups where they can effectively maintain physician leadership and yet still provide more coordinated and connected care for patients. The key here is scale and capital, both necessary for medicine in the 21st century, and neither is available to most private practice physicians. A fight to save private practice is a fight to save a business model and a lifestyle choice for physicians, not to save a model of care that serves patients well. It feels good and the doctor thinks that they are providing the best possible care every day in their offices, but patients need and deserve more than the hardest working private doctor can deliver by him/her self.
I just came across this blog and your post. Clearly you are studied in the world of health care so I would like to ask you a question a tad off your post’s topic – ‘do you see a time in the near future when hearing aids are covered by health insurance?’
I find it so frustrating that they are not. It seems a blatant abuse. Am I wrong? Thanks for any insight!
I find it interesting that you see the choice as between working for a hospital system (as a referral generator) and the small business owner model – the way most primary care doctors in America practice. I think that the answer lies in multi-specialty group practice, the best of all worlds. We have a 900 doctor group organized around the patient (rather than the hospital or the challenges of each doctor’s revenue stream), and with scale have been able to invest in a robust EMR shared with patients, and when I have a question about a patient with a rheumatological condition I can get an opinion without necessarily requiring the patient to have a referral – informal virtual consultation is available within a day anytime, for all specialties.
To set up a system like ours you need scale, a multi-specialty group, and payment systems that aren’t fee for service.
One of the reasons that we don’t have rational efficient care delivery seems to be our defense of the small business owner model (“you have to account for the fact that over 50% of doctors practice in small groups”) rather than an investigation of what it would take to build/incent a rational delivery system.
I am a practicing primary care doc who has advantages in practice that are now available to just a small fraction of clinicians. When I meet new patients and we talk about how I can support them, I explain that if I was just as motivated, hardworking, etc, and practiced down the street in a small group with three docs twice as smart and well trained as I, I couldn’t do half as much for them. It is time for the professional community to figure out how to organize care delivery to organize around our patients’ needs
You leave out the coordination of care issue between hospitals, specialists, and PCP’s. I don’t know how old you are, but this factor has drastically deteriorated since my training. I believe a more formal mechanism for care coordination is necessary to improve patient care.
Also, you assume that the entire system for delivering and reimbursing care will remain the same (e.g., fee for service and traditional insurance companies.) That may be true for the short term, but is unlikely to last given its inherent high costs and misguided incentives.
If I were a PCP, I would at least be looking at affiliation with some type of larger group, be it a large group of PCP’s, multispecialty group, an ACO, or whatever.