Saturday, April 02, 2011

How about a doctor's mandate in the health reform law?

The Times' Robert Pear today reports on a major roadblock to expanding health care access in the United States: in many states, few or no doctors in a wide array of specialties will see Medicaid patients.  And the Affordable Care Act aims to add about 15 million people to the Medicaid rolls, while cash-strapped states continue to cut Medicaid reimbursement rates.

I have a solution. It's simplistic, and perhaps someone will demonstrate to me that it's unworkable or unfair. It's surely politically impossible at this point, given the power of the doctors' lobby.  But here it is: require doctors to devote a minimum percentage of their practice to Medicaid patients.  At present, about 28% of doctors refuse to accept any Medicaid patients.  The percentages are doubtless much higher in some practice specialties and states.

Throughout the country, cities and towns require developers who want to build luxury housing to set aside a percentage of new developments for affordable housing. Why can't we require the same of doctors? With the exception of primary care physicians, for whom the financial burden of this policy could perhaps be offset, they make enough.

There are burdens on physicians unique to the United States' dysfunctional health care system that partly offset and justify the uniquely high level of compensation: the outrageous administrative burdens of dealing with multiple insurers, each with its own fee schedules, forms and rules; the high cost of malpractice insurance; and mostly unsubsidized medical education. Nonetheless, we in the U.S. pay 50-100% more per capita on health care than people in other wealthy nations mainly because we pay more for each treatment and procedure. Our specialists are for the most part overcompensated.  They can afford a haircut of, say, 40% of their fee on say 5-10% of their patients.  The broader tradeoff in true healthcare reform would be to alleviate some of those unproductive burdens in exchange for relatively less pay for physicians in most specialties.

Making a degree of Medicaid acceptance mandatory might prevent scenarios like this, reported in the Times article:
For Draven’s pediatrician, Dr. Rachel Z. Chatters in Lake Charles, La., caring for poor children is a mission. About 80 percent of her patients are on Medicaid. It is, she said, frustrating to beg and plead with other doctors to see Medicaid recipients.

“I devote one afternoon a week, every Wednesday afternoon, to trying to find specialists for my patients — a pulmonologist for children with chronic persistent asthma, a neurologist for children with seizures or developmental delays, a psychiatrist for children with serious mental health problems, a hematologist for patients with sickle cell disease,” Dr. Chatters said.

Draven’s mother, Ana M. Smith, said: “I have tried for more than a year to find a child psychiatrist or psychologist to get Draven evaluated, but the mental health professionals in this area have told me they absolutely do not take Medicaid.
Imposing a Medicaid/Medicare requirement on doctors would add to government's sorely lacking pricing power. It's true that in the United States, government pays about half the medical bills, and certainly has a lot of clout in the market. But because there are many other payers, and because providers can control how much government-financed care they deliver, government here lacks the monopsony pricing power that almost every other wealthy-nation government imposes as a condition of universal healthcare. Hence we pay twice as much per procedure as provincial governments do in Canada, for example.

It may be that mandating acceptance of Medicaid patients would induce doctors to charge more to patients covered by private insurance.  For all the attention paid during the debate over health care reform legislation to private insurers' unsavory profit-maximizing strategies, their real ill effect on the market may stem from their lack of pricing power.  Again, countries that provide universal healthcare channeled through private insurance, including France, Germany and Japan, impose uniform pricing schedules on insurers and providers. That's the missing link in the U.S.

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