Managed Care A Physician Assistant Tells It Like It Is
presented by Jim Morris, PA-C
Western Regional Meeting of AAPS
Then I said, ``I have a question for you.''
``What's that?'' he responded.
``Have you ever heard of terminal acne?'' I asked.
``No, is this terminal?''
``Wake me up at 2:00 a.m. again and it will be.''
One of my past positions was as part of an HMO team. I was one of those people that went out and sold the program to companies, to doctors, to hospitals. This was a real eye opener. I'd like to tell you the methods we used to sell HMOs.
First, we were instructed in how to talk to employers. The first thing you talk to employers about is reduced cost. We told them that their employees were paying $320 a month for insurance for their families and that we could do it for $90 a month. When employees went to the doctor, it would only cost a $10 copayment.
Well, we just happened to forget to tell the employers that since it only cost them $10 to go to the doctor, the employees would probably go more often, losing more time on the job. The other thing that we forgot to tell them was that people were going to snap the program up, and after that they would be ours. We would own them.
From the managed-care company's standpoint, the more people we could sign up, the better. Every person enrolled means more revenue generated. So we went in and sold this program as quickly as we could. Some of you may have long discussions with your insurance man or with your attorney. Our average appointment with a management team was one hour. We wanted to present everything and get out of there before they had time to ask any questions. And as long as a CEO was looking at the bottom line, it was a go. We probably sold between 85 and 90 percent of the plans we approached.
I look back on that and I think I resembled a used-car salesman. This runs great, looks good, here it is, take the keys, gimmie $100, it's yours, you're outta here. The problem is, I didn't tell you that it's probably only going to get you about three blocks down the road, if you're lucky.
When we sold to physicians, our point was to join now or somebody else would. We said we've only got slots for four family practice docs in our list of physicians here so you know if you don't sign, Dr. Jones down here will and of course if he signs and you don't and you have patient that all work for John Doe company over here, he gets all of those patients automatically. It doesn't make any difference whether they want to go to him or not, that's where they are going to go if they want their services paid for.
We preyed upon poorly educated employees. If they were hesitant at all, we'd go out on the factory floor as we were walking out and say ``Wait a minute, if you're really not sure this is a plan for you, let's ask this guy over here running this mill.'' We'd pull the guy off the mill and say, ``Listen, young man, how much do you pay for health insurance for your family? How would you like to pay one third of that? Oh, and you pay 20 percent on top of that? Oh, well, how would you like to pay $10?''
Now, you only have to hit one man on the floor or possibly two, and the word would go through that company. There is a health insurance plan available that is only going to cost one third of what people are paying now and $10 a visit. The plan is sold. They will not dare turn your plan down because they will have a revolt from the employees if they do.
We gave people limited information concerning the panel of physicians. People would ask, ``Well, is my doctor on the panel? Could I go see my family doctor?''
``Well, we are currently negotiating with a number of physicians to join our panel and actually we are talking to Dr. Jones, your physician, and he has shown some interest.''
I hadn't even been to see the man yet. That's the way the system works. Don't answer any question up front, and don't answer them straight. Make a quick sale to the employer, and do it by selling it to the employees first, if necessary.
Then I changed jobs. I went from selling HMOs to working in a private office in which the physician I worked with signed up for a number of HMOs. He got caught in the crunch: ``If you don't sign, the doctor down the street will. You've got 4000 patients, we own 1200 of those, can you afford that loss in income with three kids in college?'' Those were the types of things that were told to the physicians. When the physician I worked for refused to sign up for an HMO, we lost 300 patients overnight. That's a pretty good chunk out of a single physician family practice group. That's a significant cut in income.
Another selling point for doctors is the capitation. The idea is to get 300 patients on your panel, knowing that only 5 percent of the population is really ill. Well, I'm not sure who has worked in family practice, but let me explain what actually happens. If you tell 400 patients that they can come to the doctor and be seen for $10 or less, you can bet that a good portion of those are going to show up-far more than 5 percent. It makes it harder and harder for the sick patient to get in to be seen. So they start going outside the system. What happens if they go outside the system? They don't have any insurance.
``Well, that was on page 42 in the fine print that said that if you didn't see your family physician first, then you have to pay for the service out of pocket.''
``You mean you didn't call us and ask? Oh, well I'm sorry that's on page 43, it says call this 800 number'' (which of course is always busy).
If a patient goes outside the system and to a (please pardon the terminology) doc-in-the- box, and he says, ``Well, look, you've got this bad heart murmur and you should go see the cardiologist,'' the patient generally makes an appointment to see the cardiologist. But he wasn't referred by his family practice doc, and he has no coverage. So now he's faced with a bill for $1200 to $1500, and no coverage.
We had patients go through this. We had a doc-in-the-box next door, two doors down from our office. We had people go there. They would walk into our office, and our receptionist would say ``I'm sorry Mrs. Jones, our next opening is next Thursday.'' ``Well, I'm sorry, but I need to see somebody today.''
The patient could walk right out in the parking lot and see the sign that says ``M.D. on duty'' and walk in. She doesn't know any better, she doesn't care at that point, not until the bills start rolling in. And the insurance company doesn't care, the HMO doesn't care. They say, ``I'm sorry-you didn't follow the guidelines, and we're not paying for anything.'' And they don't. The next thing you know, I have to see Mrs. Jones in the office with chest pain because she just got this $1200 bill from the cardiologist. She thought she had insurance, so she called the insurance company, but they refused to pay. She's down to the last $5 of her fixed monthly income after she pays her rent and her groceries.
One of the other problems we had was with patients who had to travel a long distance. One of the HMOs we signed up for was in Reno. We worked in Gardnerville, Nevada, which is about 65 miles south. We were one of the first family practice docs to sign up with this HMO, so we had people driving 65 miles for their routine office care when there were obviously a large number of family practice doctors in an area like Reno or Sparks that were more than willing to see them. Many of these patients were elderly. Some were sick children who cried for 65 miles on their way to see us. If the patient wanted to see somebody other than the family doctor on the panel, or wanted to go to the ER, he had to get prior approval. Try to get approval after 5:00 at night or on a weekend. It doesn't happen. Any number of HMOs, including the one that I was involved with, had five or six operators on during the day, but only one operator at night and on weekends. That 800 number would ring incessantly. I have even called it myself and let it ring 60 times and not had an answer. That's what happens to your patients.
Now, what about transporting a patient by ambulance? Suppose Mrs. Jones calls you says ``My husband fell down the stairs, and I think he broke his hip.'' You can't just say, ``Okay, we'll call the ambulance, and we will see him in the emergency room.'' They have to call and get that approval for that ambulance, and you have to be sure they have done it. And many HMOs don't cover ambulance transportation, so it's an out-of-pocket expense.
Here's what happens, and this is a true story. I saw an 18 year old girl who came in with acute onset of a heart murmur and chest pain. I said ``look we ought to send you to see the cardiologist.'' Well, we had to call and get approval to send her to the cardiologist. Getting approval was not a major problem with this particular HMO; the process worked pretty well. The only problem was that we paid for the cardiologist out of our capitation fund. I was lucky. The doctor I worked with didn't look at dollars; he looked at patients. He took care of her and sent her for a consultation. There were other doctors I know that worked in the same area that did not refer patients because they had to pay for it.
Suppose you have a patient who does not have a life threatening condition. We had a 35- year-old woman with new-onset seizures, whom we attempted to refer. According to the HMO panel, we had to try at least three anticonvulsants before she could be referred to a neurologist. They would not pay for an EEG, they would not pay for a neurosurgical or a neurological evaluation until she had been tried on at least three drugs.
Now let's talk about the panel. We did try this seizure patient on three drugs, and then we attempted to get an EEG. Because it was ``expensive'' (the definition is determined by each individual HMO), the request had to go before the approval panel. If you're lucky, the panel meets weekly. Unfortunately, ours met monthly to begin with. We submitted a consultation form to the panel with the clinical information and requested permission to send this patient to an out-of-panel neurologist to have an EEG done. Unfortunately, on the panel there was one physician (as it happened, an internist who was fairly well trained), one accountant, and a CEO or CFO of the HMO. Well, the financial person doesn't care. The patient is not related to him, and he is not married to her, so, as far as he is concerned she's just another body, and he is looking at expenses. Each person has a vote on whether or not that person gets that test done. The physician voted yes, and the accountant and the CEO voted no. Even if the physician has a good conscience, he loses. This happened three times before we were able to refer this patient.
There are strict criteria for patient care, you have to meet certain criteria before you can transfer a patient. I worked in a cardiology group for a while at a large hospital in Nevada. It was near the State line. We used to get patients over from a large HMO in Sacramento. They came to us after they had had an angiogram. Because of chest pain, they had been admitted to the hospital of their HMO facility and evaluated. After their chest pain was calmed down, and they were doing fairly well on their nitrates, they had their angiogram. One gentleman in particular, who was 76 years old, had two 75-percent lesions and one 70-percent lesion. His HMO said, ``First of all, we don't do anything for lesions of less than 80 percent lesions, and secondly, we don't operate on anyone over age 70.'' It didn't make any difference that this gentleman looked 60 rather than 75 or 76. He was told, ``we just don't do those lesions, so, you know, sorry.'' It's like socialized medicine in Canada.
If you talk to people who are trying to sell HMOs to physicians, they'll tell you that they sell it as a get-rich-quick scheme, especially if it is a capitation program. Physicians are promised $2000 to $6000 per month even if they see none of the patients on the panel. But the patients do come in. We signed up a 400-patient panel, and we averaged 120 of those people a month.
The people who do get rich from HMOs are the managers. As the Wall Street Journal recently showed, they are the ones who take home the money. Physicians may think they will get paid for doing little or nothing, but they actually get beaten into the ground. They can no longer be patient advocates. They have to start protecting themselves. They have to think of their income; they have a house to pay for and kids in college.
Both physicians and patients lose the ability to make the best choices. Suppose a patient needs a neurologist, and you have doubts about the neurologist assigned to the panel. For example, maybe he's not quite as aggressive as you would like. But it doesn't make any difference. If he is on the panel, that's where your patient goes-once you get approval. It happens over and over.
Another problem is that there may be 20 family practice docs on a panel and only one neurologist. Even though there may be five or six in town, there is only one on the panel. So try to get a patient in. It was not uncommon to call for cardiology or neurology services and find out that there was a three- to six-month wait for an appointment. And then that was an initial evaluation appointment, not one for providing any services. After that, there would be another three- to six- month wait for a follow-up.
The end result is medicine by proxy. The panel decides what's going to happen to your patient, not you.
Since I am a physician assistant, I work with physicians. The physician makes the ultimate choice about how the patient is treated, and I assist in that care. Nonetheless, I was trained to take care of the patient the best way I know how and to use all of the knowledge that I have. After 20 years of experience, it is very distressing for me to fill out a form so that two financial people and one doctor can decide what's going to happen to my patients.
There is now the legal question about whether the physician is open to litigation when a panel decides on medical care. I know of two cases pending in California, involving doctors who were sued because they failed to refer a patient when a panel told them not to.
As I said, a certain portion of physicians' capitation goes into the referral fund. Exactly how it works depends upon the contract, but in the situations I experienced, this is what happened: If the amount of care exceeded the amount in the referral fund, the cost was deducted from the monthly capitation fee. Instead of a $3000 check, it was common for us to receive $1500 or $1700 because we spent more than we were supposed to for specialty care. Again, the doctor I worked with was more concerned about his patients than his checkbook.
There is also something called a catastrophic fund. That is a certain percentage of the physician's income that is set aside to cover those patients that need a bypass or that have to have chemotherapy or a transplant, etc. What happens to those doctors involved in the HMO when there is no money left? Suppose you happen to be in that unlucky group that has three five-vessel bypasses and a kidney transplant in a year? There is no money left. The question is, who is responsible?
If any of you really contemplate joining an HMO, read your contract very carefully. There is something in there about how long you are liable for expenses and also how long for patient liability. If you happen to make the error of signing up, and if you are then so lucky as to be ``de- selected,'' you might still be liable for expenses for the remainder of the contract period.
I have worked in family practice and in a cardiology group that were involved in HMOs. I have been involved with four HMO groups as a provider and in one HMO corporation as a sales representative. It is the worst thing that I have ever done in my life. It is perverse, and it is inhuman. It destroys physician choice and patient choice. It leaves the ethics of our profession in ruins.