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of American Physicians and Surgeons, Inc.
A Voice for Private Physicians Since 1943
Omnia pro aegroto
Volume 46, No. 5 May 1990
WILL PHYSICIANS CONTINUE TO
As Medicare regulations are tightened, physician dissatis-
faction grows. But the level of anger vented in the physicians'
lounge is actually of small concern. The important question is
the availability of patient care.
Some prospective patients are beginning to worry. The
American Association of Retired Persons (AARP) supports mandatory
assignment and bans on balance billing-``if careful analysis
indicates that access to care would not be reduced.''
A few vocal physicians have stated publicly that ``I no
longer can tolerate the limits imposed by the Medicare
bureaucracy on clinical practice, patient care, and accounts
receivable. Therefore, I have stopped accepting Medicare
patients in my office practice'' (Edward R. Sodaro, MD, Private
Practice, Nov 1989).
To investigate how many physicians have taken or contemplate
similar action, AAPS recently sent surveys to 3,265 physicians in
active practice of adult patient-care specialties. All such
physicians in Pima County (AZ), Hamilton and Lucas Counties (OH),
Jefferson County (KY), and DeKalb County (GA), were contacted by
mail. Questionnaires were returned by 438 physicians (13.4%).
In addition, all physicians receiving AAPS News were
surveyed. Responses from the latter were analyzed separately (see
p. 4) and not included in the tallies given below.
The survey covered general attitudes toward Medicare,
opinions about proposed changes in the health care system,
present willingness to treat Medicare patients, the possible
effect of regulatory changes, and the impact of PRO activities.
Medicare patients in some areas may already be having
difficulty finding a doctor. New Medicare patients are accepted
only under special circumstances by 17% of primary care
physicians and 12% of surgeons. About 4% of primary care
physicians and 2% of surgeons accept no new Medicare patients at
The majority of physicians say they plan to restrict their
Medicare practices as a result of proposed or newly enacted
regulations. About 48% of primary care physicians and 42% of
surgeons say they would restrict appointments if balance billing
is banned; 27% and 64% (respectively) would do so if reimburse-
ment is cut; 44% and 25% plan to cut back because of the
requirement that physicians submit all claims after September 1,
1990; 64% and 48% say they'll do so if mandatory assignment is
enacted; and 64% and 56% if practice guidelines are accepted as
the standard of care.
Respondents' attitudes may have been affected by com-
munications from PROs. (It is possible that recipients of
demands and threats from their PRO were more likely to return the
questionnaire.) The majority (53%) of the primary care
physicians have received notices of ``unnecessary'' services
(compared with 15% of surgeons). Notices of ``substandard care''
were reported by 12% of primary care physicians and 4% of
surgeons. Sanctions threats were received by about 22% in both
Overall, 70% of physicians said they contemplated retirement
from active patient care at a younger age than they would have
thought possible five years ago. The percentage was lower (57%)
for physicians who had been in practice for five or fewer years,
but the difference was not significant.
Some physicians commented that they had quit practicing or
had reduced services to Medicare patients because they were
unable to earn enough to cover overhead. Others say that they
would like to retire or restrict their practices but could not
afford to do so. Overall, physicians reported that receipts from
treating Medicare patients averaged 60% of their normal fee.
``If I only saw Medicare patients, I would do better
financially as a garbage tipper,'' commented one orthopedic
``I'm trapped by my specialty,'' said a pulmonologist.
``Eye surgeons are totally at Medicare's mercy,'' stated an
ophthalmologist. However, he noted that ``if the excimer laser
is accepted to eliminate glasses, many eye surgeons might
eliminate Medicare patients.''
The overall evaluation of the Medicare program was strongly
negative, with rare exceptions. Only 20% agreed with the oft-
repeated statement that Medicare has been a ``boon to the
elderly.'' Of the 85 physicians giving an open-ended brief
description of Medicare, two had a strongly positive comment;
eight a lukewarm endorsement (e.g. ``better than nothing''); and
the remainder an unequivocally negative statement (most commonly
emphasizing ``inefficiency'' and outright ``fraud'').
Of the proposed alternatives, 18% of respondents favored
national health insurance for all age groups; 3% were for
mandatory participation; 29% for outlawing assignment; 67% for
allowing patients to opt out and buy private insurance; and 13%
for abolishing Medicare (3% by enacting NHI). Of the group
favoring NHI, 20% were psychiatrists (vs. 8% of the sample),
while primary care was significantly underrepresented.
Few physicians (4%) felt that the government's attempts to
``assure quality'' and contain costs rewarded excellence and
efficiency. Instead, 63% said that the regulations rewarded
doctors for manipulating the system to maximize profit, and 82%
said that the regulations tended to prevent patient care.
Politicians seem to believe that physicians, for all their
grumbling, are like the socially responsible horse in Animal
Farm. Will physicians prove them wrong?
Are You in Compliance?
Insurance forms sent from our offices are legal documents,
whether or not we have personally signed them. By submitting the
forms, we certify that we are in legal compliance with all the
requirements for assigning the correct CPT-4 codes. Yet many of
us have willingly allowed ourselves to be deceived into following
a system in which fraud is pervasive.
Most insurance companies have agreed with CPT-4 standards
set by Blue Cross/Blue Shield, including the time requirements.
According to an official circular distributed by BC/BS in May,
1989, a 90060 (``intermediate'') visit is defined as 25 to 30
minutes of personal contact time with the physician. A 90050
(``limited'') visit requires 15 to 20 minutes.
Enterprising doctors have found many ways to manipulate this
system, with the excuse that the insurance companies are
defrauding us. Seminars throughout the country teach these
methods. For example, Medicare allows doctors to charge for a
90017 (``extended'') service once for each new diagnosis in each
patient's lifetime. A 90060 visit is allowed twice each six
months for the same diagnosis. To avoid automatic downcoding for
a greater number of such visits, seminars teach physicians to
assign different diagnoses.
Insurers intend to hold doctors to the literal requirements.
In August, 1989, Arizona Health Plan stated that they soon plan
to ``bust'' large numbers of doctors for fraudulent coding.
(They have sent their investigators to the coding seminars.)
Within a few years, insurance companies will be able to share
computer data and discover how many patients a physician saw on a
given day. Doctors who bill for 30 to 40 ``intermediate'' visits
in a single day will have to face charges. The physician, not
the office manager or the seminar instructor, is culpable for
practicing insurance fraud.
It is essential for physicians to read the description of
the levels of effort required for the various primary visits
(90000-90080). I'm not going to say I agree with the
requirements. However, as persons of integrity, we should
realize that our signature on a contract, licensure agreement, or
hospital privilege agreement requires us to keep our commitment.
``He that swears to his own hurt and changes not...'' (Ps. 15:4).
Paul Glanville, MD
Excerpted with permission
from J Biblical Ethics in Medicine, Winter, 1990
From Capitol Hill
GAO Says Forced Assignment Doesn't Hinder Access. A
study carried out by the General Accounting Office in Rhode
Island, Connecticut, Vermont, and Massachusetts, concluded that
bans on balance billing of poor patients or mandatory assignment
for all Medicare patients did not hinder access to care or cause
boosts in volume or intensity of service. The GAO cautioned
against extrapolating this experience to the nation as a whole.
Penalties for Inadvertent Balance Billing of Low-Income
Patients. Since April 1, physicians have been required to
take assignment on all Medicaid-eligible patients. If a
physician suspects that a patient's income may be at or below
federal poverty limits, he is advised to ask the patient for a
Medicaid card or call the state's Medicaid hotline. Even if
patients are reluctant to admit to their low income, physicians
who bill them erroneously could be subject to sanctions or fines.
Pepper Commission Reports. The goal of the US
Bipartisan Commission on Comprehensive Health Care is universal
coverage. ``At full implementation, all Americans will be
required to have health insurance through their employer or the
public plan.'' A few key recommendations: (1) Requiring
employers to provide a specified minimum benefit package to
workers and nonworking dependents, or to ``contribute'' a
percentage of payroll into a public plan; (2) extending tax
credits or subsidies to small employers for 40% of the cost of
health insurance; (3) insurance market reform to prevent
employment-based programs from excluding pre-existing conditions
or denying coverage to any individual or group; (4) extending
managed care to to small employers; (5) extending Medicare
payment rules to the public program, which will serve as a model
for private insurance.
The Commission also calls for the development of national
practice guidelines and standards of care, already begun by the
newly created Agency for Health Care Policy and Research, and the
implementation of a uniform data system to cover all health care
encounters, regardless of payment source or setting.
The Commission stated it was ``committed to raising whatever
additional revenues are necessary,'' without committing itself to
any specific type of tax. Whatever the tax, it should be
progressive, cross-generational, and inflation proof.
The high cost-estimated to be $23.5 billion for the
insurance program and $42.8 billion for long-term care-and
inattention to financing details may jeopardize enactment.
Mark Your Calendar. April 1: Unassigned claims
that fail to include ICD-9 codes will be referred to the
Inspector General for possible sanctions. May 1:
Assigned claims that fail to include Medicare carrier
identification numbers of the performing physician will be
denied. July 1. If ICD-9 codes are incomplete or
inaccurate, assigned claims will be denied and unassigned claims
referred to the IG for possible sanctions. September 1.
Physicians must submit all Medicare claims to carriers, whether
assigned or not, without charging the patient for this service.
Medicare carriers will implement a Congressional mandate to
profile individual physicians and refer those who deviate from
the norm for reeducation. October 1. The physicians data
bank is supposed to be in operation, under $15.9 million contract
Laboratory Regulations. Sen. Barbara Mikulski (D-MD)
complains that cancer is going undetected and patients are
receiving erroneous laboratory reports with tragic results, all
because HCFA's enforcement of the Clinical Laboratory Improvement
Amendments of 1988 proceeds at a ``glacial'' pace. One problem
is that the number of labs is perhaps six times larger than the
original estimate of 100,000. A HCFA official noted that the
single most difficult task will be to find the labs. HCFA will
depend partly on labs identifying themselves to the government,
as by writing to ask a question. ``If you ever ask, you're
regulated,'' the official said.
Physicians doing a small volume of tests may wonder why they
will have to pay as much as referral labs (up to $3000). ``There
has to be some kind of assurance of income for this program,''
said Tony Elias of HCFA.
AAPS Member Sues Medicare over 1990 Fee
On Monday, April 9, 1990, AAPS Director Sidney R. Steinberg,
MD, a general and vascular surgeon in Shelbyville, KY, filed suit
in the US District Court for the Eastern District of Kentucky
against Louis W. Sullivan, MD, Secretary of HHS, and Blue
Cross/Blue Shield of Kentucky, the Medicare carrier. The lawsuit
seeks declaratory and injunctive relief on the ground that the
development and payment of fees for diagnostic and surgical
services rendered to Medicare beneficiaries, effective April 1,
1990, are in direct and explicit violation of the Medicare
amendments to the Omnibus Budget Reconciliation Act of 1989,
which provide, in part, that:
1. Specified ``overvalued'' diagnostic and surgical
services were to be reduced by 15%;
2. All other diagnostic and surgical services were to be
increased by 2%; and
3. In determining the reasonable charge, the prevailing
charge for each service may not exceed the prevailing charge or
fee schedule amount for that specialty of physicians that furnish
the service most frequently, nationwide.
In Kentucky, the Medicare carrier presented physicians
with fee screens that were reduced across the board by 30% to
40%, compared with 1989. One fee screen for an otherwise
``undervalued'' service was reduced by 82%.
In 1984, the US Court of Appeals for the Sixth Circuit, in
the case of Michigan Academy of Family Physicians v. Blue Cross
and Blue Shield of Michigan, interpreting the then-existing
Medicare Act, found that the Secretary of HHS was determining the
fee screens incorrectly and should not discriminate between
specialists and nonspecialists. However, neither HHS nor the
Medicare carrier in Kentucky ever made any adjustment in the fee
screens pursuant to this court decision in the years 1985 through
The Complaint alleges that after failing for five years to
make the adjustment in fee screens ordered by Michigan Academy,
the Secretary and the carrier applied that methodology in 1990,
after it had been specifically overruled by Congress. The result
was dramatically undervalued fee screens, to which further
reductions were applied as mandated by recent Medicare
amendments. Because the proper methodology was not used to
determine the ``prevailing charge'' for the years 1985 through
1989, the current method is not in compliance with federal
Dr. Steinberg is a ``participating'' physician under Part B
of the Medicare program, and must therefore accept the amount of
payment determined by the Secretary of HHS and the Medicare
carrier as full payment for services rendered. Patients treated
by ``nonparticipating'' physicians (65% of all physicians,
nationwide) will see a dramatic increase in the amount that they
will be required to pay.
Cataract PPOs Proposed by HCFA
A pilot program for cataract PPOs, patterned after the
Health Care Financing Administration's coronary artery bypass
graft (CABG) PPO, is slated for testing at three sites. The
cataract PPO would pay a single lump-sum, discounted fee to the
facility, covering all facility, physician, and material fees.
The incentive will be a high volume, with patients coming from
long distances. The HCFA states that it does not intend to
create a ``single provider'' model. Participation by
beneficiaries would be voluntary; they would be attracted by
advertising and a reduction in copayments.
The American Academy of Ophthalmology has voiced strenuous
objections to the proposal, stating it would put the government's
``seal of approval'' on the ``cataract-mill model.'' A single
disease, rather than the patient, would become the focus of
service. The result would probably be to increase volume, the
opposite of the government's stated intention.
A Georgia ophthalmologist states he has been approached by
an entrepreneur, who allegedly hopes to earn a $300,000
consulting fee. The argument is that ``if you don't do it,
someone else will.'' Ophthalmologists in the area are very
fearful. Once instituted, such systems tend to become en-
trenched, whatever their effect on patient care.
The proposal has the strong support of new HCFA Ad-
ministrator Gail Wilensky, who helped develop the CABG PPO now
Garbage and the Status of Physicians
Physicians who have a laboratory are, by definition,
generators of hazardous waste.
Performing simple procedures that are exempted from
proficiency testing requirements still subject the physician to
Medicare regulations for laboratories and the need to pay the
certification fee. Stool guaiacs, fingerstick glucose determina-
tions, and urine dipsticks are examples of such tests. Of
course, these also generate infectious waste, especially if the
physician uses a glove for the rectal examination.
The pollution of beaches by syringes dumped overboard by a
US Navy aircraft carrier serves as the justification for
increased regulation of physicians. Karl Sandberg, MD, of
Wrightwood, CA, describes the procedures in a letter to his
county supervisor, after the ``shock troops'' hit his office:
The inspectors started wandering through
the clinic looking into rooms with closed
doors without so much as a ``by your leave.''
Remember that this is while I am seeing
patients and that most of their ``search''
took place in the back office where patients
are seen. Don Hann expressed in a loud voice
his concern that used tongue blades and
examining table paper and paper gowns were
not in ``red bags marked infectious
wastes,''...in a locked and separate storage
room with warning signs....
The mentality that anything anyone has touched is
``infectious waste'' is limitless in its application
(as well as ludicrous). What about the disposable
forks and spoons at McDonald's? What about the kleenex
you dispose of in your own home?
Noel Kleppel, MD, an attending surgeon at the Brooklyn-
Caledonian Hospital and a ``generator'' of infectious waste,
showed a quadruplicate form to a Medical Tribune reporter. He
must send one copy to the City, one to the State, and one to the
``You know what this means? It means I report to the gar-
AMA Unveils ``Health Access America''
The AMA's proposal, intended to ``restructure and
strengthen'' American medicine, looks very much like the Pepper
Commission report. In fact, at the recent National Health Forum
meeting in Washington, DC, the AMA took credit for the deciding
vote on the Pepper Commission in favor of a payroll tax to fund a
public program. The vote was cast by Reagan appointee James
Davis, former AMA president.
Key provisions include requiring employers to provide health
insurance; expanding Medicaid; and ``practice parameters'' to
``assure only appropriate, high quality services are provided.''
No cost estimates were given.
The $2 million campaign, described as ``blowing 76
trombones'' in the Medicare-Medicaid parade, marks a cosmic
transformation from the days when the AMA opposed government
medicine. It is time to ``extinguish the flame'' of the
``buccaneer'' spirit of private enterprise in medicine, according
to Marshall Block, MD, editor of Arizona Medicine (Feb 1990).
``The world has changed, and the AMA has changed,'' said AMA
president Alan Nelson, MD. ``Thank God.''
Access Assurance in South Carolina
In order to forestall the imposition of mandatory assignment
by the South Carolina legislature, the Greenville County Medical
Society prepared a resolution requiring all member physicians
either to staff a primary care clinic for the indigent or to
accept up to two new Medicaid patients per month into their
practices. Members not in compliance could be referred for
possible action by the Board of Censors. A state society
resolution to study the goal of 100% Medicare/Medicaid
participation will be presented at the annual meeting. The
society is worried by the legislature's ``irritation'' at
physicians' unwillingness to see Medicaid patients, despite
recent increases in payment. Some recommended publishing a list
of those who ``adamantly refuse'' Medicaid reimbursement.
AAPS Members a Little Different
The AAPS survey on Medicare (see p. 1) showed AAPS members
to be far more committed than other respondents to maintaining
physician independence and limiting the role of government. Only
1.5% said they favored NHI, while 35% think Medicare is
unconstitutional. Almost half favor abolishing Medicare
altogether, although a substantial proportion are of or near
Medicare age themselves. Nearly a third accept new Medicare
patients only under special circumstances, if at all.
(Some care for these patients without compensation.) However,
AAPS members are not significantly different from other
physicians in the percentage considering practice restrictions in
response to new or proposed regulations. Early retirement is
contemplated by 69%, about the same as for other physicians. But
two AAPS physicians dissented strongly:
``No, I'm not going to retire early. I am going to fight
the bastards! I do private medicine only.''
``No, I'm not going to quit. The SOBs can't run me out!''
Emeritus member R.D. Berkebile, MD, commented that ``the
AAPS is the last wall between medicine as we knew it and the
Soviet type of complete politician control.''
Nearly 40% of AAPS active members have sent in their
questionnaires; responses are still coming in. For complete
results, please send a self-addressed, stamped envelope.
AAPS welcomes Drs. Robert J. Broselow of Lubbock, TX; Carol
A. Brown of Honolulu, HI; Calvin Ennis of Escatawpa, MS; Paul
Glanville of Chandler, AZ; Emerita Gueson of Bensalem, PA; C.
Thomas Jewell of Boise, ID; Nathaniel S. Lehrman of Roslyn, NY;
I. Lloyd Roberts of Glen Head, NY; R. Owen Sear of Winter Haven,
FL; Edward Sodaro of Amityville, NY; Alan Shewmon of Los Angeles,
CA; and William V. Trowbridge of Novelty, OH.
Keeping the Flame; and Errata
Dr. Peletiah Webster's letter (AAPS News April 1990)
was previously published in Private Practice.
Robert M. Webster, MD, notes that the date was 1780, not
1789. He also shares an observation: ``The men that look after
the furnaces do not set the world on fire-nor do they put out
April 20, 1990. Preserving the Practice of Private Medicine.
Medicolegal seminar, Toledo, OH.
April 21, 1990. Board of Directors meeting, Toledo.
May 13-16, 1990. Eighth IATROS Congress, Reform Club and
Royal Horse Guards Hotel, London. IATROS is the international
voice for private doctors. Contact R.S. Jaggard, MD, 10 E.
Charles St., Oelwein, IA 50662. Telephone: 319-283-3491.
Sept 13-15, 1990. 47th Annual meeting, Clarion Hotel, Scotts
Oct 17-19, 1991. Annual meeting, Lexington, KY.