For years, doctors have been warning that our health care delivery system is being damaged by health insurers' strategy of cutting payments to physicians and other health care providers to control costs. The evidence is becoming clear that the damage is real and its consequences affect everyone who needs medical care.
Whether you're talking about a nonprofit hospital or a for-profit physician practice, a simple maxim prevails - no margin, no mission. Payment cuts by health insurers and Medicare have produced far more than a reduction in health care providers' profit margins; they have cut deeply into the ability of our delivery system to meet the needs of our communities.
But don't just take doctors' word for it. This month, no less an authority than the National Academy of Sciences' Institute of Medicine made this point, among many, in a set of three reports about an urgent crisis in our nation's emergency departments. The reports gained wide media coverage, mainly for their top-line conclusion that our emergency departments are stretched to the breaking point by an inadequate capacity to meet surging demand for emergency care.
Less noticed by the media was the institute's explanation of how things got to this point. Despite soaring demand for emergency services because of older and sicker patients (many of them uninsured), from 1993 to 2003, the United States "experienced a net loss of 703 hospitals, 198,000 hospital beds and 425 hospital EDs, mainly in response to cost-cutting measures and lower reimbursements by managed care, Medicare and other payors."
In short, managed care's strategy of cutting provider payment has taken us to a dead end.
The crisis in emergency care is just the beginning; primary care is in an equally precarious condition. The American College of Physicians this year issued two policy reports describing an impending "collapse of primary care medicine" because of a shrinking pool of primary care physicians at a time when an older and sicker population demands ever more of their services.
It's not a pretty picture, yet in Maryland and Washington, CareFirst BlueCross BlueShield has announced a new round of physician payment cuts effective Saturday in order to match UnitedHealth Group's low payment rates. CareFirst and UnitedHealth dominate the Maryland and Washington insurance market, charging ever-higher rates to customers while paying health care providers at unsustainably low rates.
Doctors aren't alone in thinking that something's wrong when UnitedHealth's customers can't afford what the company charges in premiums and doctors can't stay in business on what it pays in reimbursements. Yet its stockholders are happy and the company's CEO got paid $1.6 billion in stock options.
Physicians are responding to CareFirst's unilateral payment cuts. Among the reactions of those who have advised the Maryland State Medical Society, or MedChi, of their plans:
A practice of family physicians, which would take a hit from CareFirst of $20,000 per doctor, will drop all its health plans.
A pediatric practice, which would suffer a 42 percent cut from CareFirst, also will stop participating in health plans.
That's in addition to the scores of physicians who told MedChi last year that they had stopped providing on-call coverage in emergency departments because of soaring malpractice costs and the likelihood that they will be paid nothing for their work in the ER.
This is what reduced access to care looks like: inability to find a primary care physician and a strong possibility that when you go the emergency room, there won't be a surgeon or other specialist there to help you.
When you reach a dead end, you have to turn around and find another way. Maryland physicians believe that what's needed most is leadership, especially from employers, but also from government, the faith community, education, labor and even families.
We believe this requires a coalition of top leaders across all levels of society to make it a genuine priority to improve basic health, such as blood pressure and weight, for everyone - not because it's the right thing to do, but because it's just good business.
Doctors are reaching out to employers and others, asking them to do this with us. Will they reach back?
Dr. George H. A. Bone is president of MedChi, the Maryland State Medical Society. His e-mail is email@example.com.