Why Reports of the Death of Physician Participation in Medicare May Be Greatly Exaggerated

“Half of primary care physicians in survey would leave medicine … if they had an alternative.” — CNN, November 2008

“Doctors are increasingly leaving the Medicare program given its unpredictable funding.” — ForbesJanuary 2013

Doctors, it seems, love medicine so much … that they’re always threatening to quit.

In some cases, it’s all in how the question is asked. (Because of methodology, several eye-catching surveys have since been discredited.)

But physicians’ mounting frustration is a very real problem, one that gets to the heart of how health care is delivered and paid for. Is the Affordable Care Act helping or hurting? The evidence is mixed.

Doctors’ Thoughts on Medicare: Not as Dire as Originally Reported

The Wall Street Journal last month portrayed physician unhappiness with Medicare as a burning issue, with a cover story that detailed why many more doctors are opting out of the program.

And yes, the number of doctors saying no to Medicare has proportionately risen quite a bit — from 3,700 doctors in 2009 to 9,539 in 2012. (And in some cases, Obamacare has been a convenient scapegoat.)

But that’s only part of the story.

What the Journal didn’t report is that, per CMS, the number of physicians who agreed to accept Medicare patients continues to grow year-over-year, from 705,568 in 2012 to 735,041 in 2013.

And other providers aren’t turning down Medicare, either. The number of nurse practitioners participating in the program has only gone up, Jan Towers of the American Academy of Nurse Practitioners says.

That’s not to overlook doctors’ feelings about the program; “the reality is that Medicare has caused some very real frustration,” according to Reid Blackwelder, president-elect of the American Academy of Family Physicians.

But that frustration isn’t new, Blackwelder said; the “tipping point was 2003” — when Medicare’s much-maligned Sustainable Growth Rate to calculate physician payments began to kick in — “and it’s been an ongoing stressor since,” with temporary patches that can lead to uneven reimbursement.

And actually choosing to opt out is still a big leap for many doctors, given that the program represents so many potential procedures; Medicare patients make up 24% of the patient population for AAFP members, Blackwelder says.

There’s more than finances at stake, too. In an informal survey of a half-dozen doctors, most told us that they felt ethically obligated to stick with the program. Turning down Medicare, “well, that’s saying no to a nice little old lady … who could be your mom or grandma,” one doctor said.

Physicians’ Medicaid Participation: A More Serious Issue

However, working with Medicaid patients — who tend to be younger, poorer, and much more diverse — didn’t provoke the same reaction.

“Now that I’ve built my practice, I don’t feel like I need to see [Medi-Cal] patients,” given the program’s mediocre reimbursement rates, one private practice physician said.

And that lack of pay — Medicaid reimburses a fractional rate compared with private payers for the same procedures — is a major factor behind many doctors’ ongoing reasons to opt out. Fewer than 70% of doctors nationally participated in Medicaid in 2012, and that problem is worsening; a recent Health Affairs study found that about 33% of primary care physicians didn’t accept new Medicaid patients last year.

The pending Medicaid expansion under the ACA may change the dynamic, slightly for better but potentially for worse, experts say.

  • To incent more doctor participation, the health law includes a 30% pay hike for PCPs in 2013 and 2014 who treat Medicaid patients.
  • However, that pay raise has been implemented very slowly, leading to new complications and concerns that participating doctors may further hesitate.
  • And the sheer volume of new patients — as many as 16 million Americans are expected to gain coverage through Medicaid — means that doctors who treat Medicaid beneficiaries may be overwhelmed by demand.

The Role of Evolving Dynamics

Doctors’ broader unhappiness with trends in health care also may reflect the changing of the guard, with a generation of doctors who came into the field during an era that allowed them to be free-ranging “cowboys” now being confronted by more programs and paperwork that attempt to force them into joining pit crews.

And Blackwelder agreed that some new federal provisions — like the push to adopt electronic medical records — could help drive older doctors to hang up their stethoscopes. (But the problem isn’t just the introduction of new programs, he says, but also government inertia around fixing ongoing concerns like SGR.)

Meanwhile, if doctors really do stop seeing Medicare and Medicaid beneficiaries, does that create an opportunity for other providers — say, nurse practitioners — to step into the void?

“It might,” Towers concedes. “We’re here to help fill a need. [And] if there’s a backing out on one side, there are NPs who are very willing to see all these patients.”

Dan Diamond (@ddiamond) is Managing Editor of the Daily Briefing, a CaliforniaHealthline columnist, and a Forbes contributor. This  post originally appeared in California Healthline.

14 replies »

  1. We have big issues with our healthcare system and, this problem is made even worse if our political situation remains as it is. The fact that one party is able to refuse a presidents wishes purely through spite should not happen and the fact that it has it not right.cheap electronics http://www.iworldelectronics.com buy accessories. We should as a country tackle this problem as soon as possible and not let it happen again!

    It’s a terrible shame that our country has come to this…

  2. Yup! – That’s why i supported Greens in the last set of elections ….

  3. Regardless of the actual number of “independent” NPs, assuming that they will accept Medicaid/Medicare at greater rates than physicians is foolish.

    Tell Jan Towers to cite REAL DATA instead of promises that NPs will take Medicaid/Medicare patients at higher rates than physicians. I refuse to cite propaganda as fact.

    Here’s the basic math:

    Medicare 99213 E&M code reimbursement = $75.23 in New York. Blue Cross 99213 reimbursement = $110.25.

    Look at those numbers and then tell me why an NP will choose different economic incentives than the physicians do.

  4. I go to doctors too and it is truly is not that hard. You can’t expect doctor’s to guarantee what your insurance company will pay…how could they? Insurers do what they want. Another problem is, no one plans to get sick and none of us (even the doctor) knows what test will be needed and what it may cost. I have no problem with a law that physicians must post all charges in the waiting room or online. For this obvious provision to happen, politicians just need to do their job.

  5. Yes, I am very aware, and yes, it is that hard! Doctors are very much a part of the problem. I cannot get a straight answer from them. They always point fingers at and hide behind insurance companies. Well, they know who my insurance company is, they make me fill out enough inept paperwork to know up front, and yet, when I ask how much it is going to cost me, they invariably say that they can’t tell me. Maybe you are the exception who confirms the rule.

  6. I agree with all of that. Our problem is the POLITICIANS yet we seem not to have the balls to throw them out. BOTH parties… ALL incumbents!

  7. I agree, politics are a big problem. I suspect my solution would be different than yours. I would also though point out to you that the AMA represents now a very small minority of doctors. Doctors have left the AMA in droves over many years. Physicians have VERY LITTLE political representation….have you seen any evidence of physicians influencing the debate? It ain’t there. Once upon a time the AMA represented physicians, now it represents political positions which have nothing to do with the view of practicing physicians. Physicians, contrary to what is the populist view, are very low level pawns. The insurers, the hospitals, the government all control the situation. Less expensive care (at any cost) is the current directive…understandably. In such an environment, experimentation with medical care delivery by non-physicians will dog healthcare in this country for decades to come.

  8. In case you were unaware, what a doctor charges doesn’t reflect what they are paid whatsoever. Payors have long since had the leverage in pricing. Ask your doctor what his fees are. Ask your insurer what they pay. If you don’t like it, walk away. For me, I bill for 3 types of visits and everyone knows what they will be paying up front. Only 2 % of the time do they pay what we bill. They pay far less If they won’t give you prices, go elsewhere. Not that hard.

  9. Doctors, the only business people in America who cannot, when asked, tell you what the prices for their services are. How can consumers make rational decisions when they cannot know the price of what they are getting? I am 48, and I am about done with doctors.

  10. Look, we have serious problems in healthcare, and as long as the politicians remain on-the-take it will remain. The fee-for-service arrangement, negotiated by the AMA, encourages doctors to over-order, even tests that are not needed. Now the hospitals are buying up physician practices to control their referrers with productivity bonuses for admissions the ordering of expensive tests. $125 million in campaign bribes kept single-payer off the table when Max Baucus pushed through ObamaCare. Get the money out of politics and the system will fix itself.

    See http://moneyedpoliticians.net/medicare-for-all/

  11. It’s always interesting how everyone has an opinion as to what doctors ought to think and do. There is no question that, because they are, as a whole, very high quality people, they hesitate to leave Medicare, even though they’ve been abused by it’s mismanagement chronically. Why? Because they care about the patients and want the system to work. You won’t find that type of behavior among most who have to maintain a business. The good will of physicians is vastly under-reported by those who want to blame the doctors for our problems with healthcare. I’m 48…and I’m about done. Physicians, the hardest working and most well-meaning elements in our healthcare system are now being seen as greedy bastards. Sad for our society. Socialism is here.

  12. Jason, thanks for reading – but I think you’re missing the forest for the NPs.

    About 6,000 NPs are in independent practice. That’s not a lot in total, although more than the 1% figure you quote, and a large enough group to draw some basic conclusions from (like whether they’re opting out of Medicare). And consider that the WSJ’s entire story hinged on 6,000 doctors choosing to opt out of Medicare between 2009-2012… less than 1% of the nation’s 750,000 doctors or so.

    I suppose I could’ve added a few sentences on how the national scope of practice debate might shake up NP employment patterns. The thrust of the story is on doctors and public programs, though.

  13. 99% of NPs are employed by doctors. Doctors make the financial decisions on which insurances to accept in their practice.

    Hoping that NPs will accept Medicare or Medicaid at a greater rate than doctors do is an assumption by somebody who doesnt understand healthcare.