Are Physician wages falling off a cliff

[grp2c]

hatton1 wrote:

From a patient perspective a surprise bill is infuriating.  I guess enough California patients got them to loudly complain. It should be transparent to patients who is in network.  It gives all healthcare providers a black eye when people do this.

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I agree surprise billing is a problem however it just represents the larger problem of payer inadequate payments to providers.  What infuriates me is that payers write the policies that contributes to the problem then lobby to pass law that cap reimbursement.  Payers offer inadequate contracts to providers or deny providers in network all together, then they raise OON deductibles/copays instead of premiums, and pt get large OON provider bills subject to OON deductibles.

Also, how hypocritical is it that this bill requires price transparency for OON providers to opt-out of the law.  But still demands IN providers keep prices hidden. By doing so, this law basically eliminates the competitive marketplace for providers but maintains the competitive marketplace for payers.

[The White Coat Investor]

 

hatton1 wrote:

The falling off the cliff  comment came from the WSJ. I guess I will not post anything I think is interesting again

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The only thing wrong with your post was not sharing your thoughts on the graph. It's certainly on topic around here and the title includes the question you're asking other forum members.

It's a far cry from a typical Crixus post.

[Hatton]

From a patient perspective a surprise bill is infuriating.  I guess enough California patients got them to loudly complain. It should be transparent to patients who is in network.  It gives all healthcare providers a black eye when people do this.

[grp2c]

Actually I would say medicine is very different from other markets in the economy.  Apparently California decided anesthesiologist reimbursements should not be determined by supply and demand with the new law AB 72 to limit surprise medical bills.

Basically the law says if a pt goes to an in-network (IN) facility and is taken care of by an out of network (OON) provider.  The OON cannot bill more than the greater of 125% medicare or the average contract rate (ACR) in the area and the pt is only subject to their IN deductible.  OON provider can opt-out and bill a higher amount with a 24 hour estimate (not really practical).

In negotiating with payers the only real leverage a provider has is to threaten to go out of network.  This law eliminates that leverage.  Payers with never raise reimbursements for anesthesiologists.

As I see it, this law will eventually price fix reimbursement for anesthesia to 125% of medicare and make networks meaningless.

If the ACR truly does represent the average rate for the area (questionable, considering payers are providing the data to create it), then when it is published in 9/2017, all IN providers below the ACR should drop their contracts and demand the ACR.  ACR should then rise, but I'm not sure there is a mechanism for this to happen.  The problem is payers will do same. Payers will drop all contracts with providers who have rates above the ACR and, per the law, patients are only subject to IN deductibles for OON providers (not sure if network adequacy requirements can prevent this).   Soon all providers are OON, so no ACR exists.  Reimbursement defaults to 125% medicare.  I guess OON providers can react by presenting estimates 24 hours in advance.

The problem is this, healthcare costs are rising at an unsustainable rate and unfortunately physicians don't have the lobbying power comparable to the other players in healthcare (pharma, hospitals, device companies, insurance companies) to stop their slice of the pie from being diminished.

[SValleyMD]

Very well said ENT Doc

[ENT Doc]

gadoc wrote:

ENT Doc wrote:

This data contradicts other data I’ve seen regarding physician salaries.  MGMA, Medscape survey, etc.  On the average, we are increasing by less than a percent with real after-tax earnings.  The IHS projections regarding mid-levels should be concerning to a few groups for future earnings, namely primary care I’m sorry to say.

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Not sure why you believe PCP’s, hospitalists, and ER physicians should be more concerned about NP/PA than a specialist.  Do you think because you are able to do a procedure this makes you more immune to NP’s? I’m sure you could take an NP and if she/he does a 100 tracheotomies they could probably do one without you.  Dont get me wrong, I’m not saying I would ever want a NP to do an ENT procedure on me. i would rather have an ENT physician.  You could probably train an NP to place a PPM but would you want her/him or an EP physician? Are you saying that if you visited an ER you would be ok with an NP seeing you instead of an ER physician. And when you need to be admitted you would rather have an NP see you as opposed to an internal medicine/ family medicine hospitalist?

I hope that for the good of patient care we would continue to have good medical care and not resort to NP/PA for primary care/er/hosptialist medicine because I honestly dont think we would have good outcomes. I think NP’s and PA’s are fantastic. We have some that work in our group. But I think they may be overstepping in certain instances.

 

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Don't get me wrong here.  I don't want more NPs and PAs taking care of me or my family.  I have seen first hand the quality difference either in direct care or by referral competency.  However, we have to look at from whose perspective does it matter and what evidence there is to support yours and my anecdotal claims.  Medicine is no different from any other area of the economy where wages are determined by supply and demand for those services.  In order to be more profitable you have to have a competitive advantage when it comes to either cost or differentiation.  The NPs and PAs already win out on wage cost (increasingly so as the supply of them balloons), so the only way for physicians to earn a higher income is by showing their profitability is higher given their higher costs or by differentiation.  The latter means proving better quality or a broader array of more valuable services.  Increasingly, literature is being put out by the NP community showing their quality (outcomes, patient satisfaction) is the same.  So to my earlier point, it is up to us to prove our superior quality and/or higher profitability.  FP, EM, and anything triage or primary care related has a low barrier to entry.  See Porter's 5 forces on how this affects profitability in an industry.  With a low barrier to entry, increasing supply and literature showing similar quality, what do you think the inevitable outcome is?  These are largely employed positions, so the only perspective that matters is that of the employer.  You may think until the cows come home that a MD is better, but if the administration (who increasingly has nurses as either part of that administration or with strong influence) doesn't agree that's all that matters.

As for specialists (procedural namely), there isn't a training construct that is nationally recognized or approved for NPs.  In every state a PA requires physician oversight.  And no hospital wants to employ a NP to just do trachs, especially when they have an ENT who can provide not only this but many other value-added services that no NP can.  It is not efficient to hire a NP for this purpose.  Again, higher barrier to entry thus more profit.  I agree with your sentiments regarding overstepping bounds and quality, and I wish the above forces weren't so.  But my comments are reflective of what I think are logical interpretations of basic economic forces and current trends.  My suggestion, again, is to plan accordingly.  Those facing obvious threats should prove their worth (differentiate) and/or prove higher profitability to the only group that matters here - the administration.  Or become part of the hospital administration so you write the rules.

[VagabondMD]

The real question is what can we do to stop more physicians from jumping off a cliff?

http://www.idealmedicalcare.org/blog/three-young-doctors-jump-to-their-deaths-in-nyc/

[gadoc]

ENT Doc wrote:

This data contradicts other data I’ve seen regarding physician salaries.  MGMA, Medscape survey, etc.  On the average, we are increasing by less than a percent with real after-tax earnings.  The IHS projections regarding mid-levels should be concerning to a few groups for future earnings, namely primary care I’m sorry to say.

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Not sure why you believe PCP's, hospitalists, and ER physicians should be more concerned about NP/PA than a specialist.  Do you think because you are able to do a procedure this makes you more immune to NP's? I'm sure you could take an NP and if she/he does a 100 tracheotomies they could probably do one without you.  Dont get me wrong, I'm not saying I would ever want a NP to do an ENT procedure on me. i would rather have an ENT physician.  You could probably train an NP to place a PPM but would you want her/him or an EP physician? Are you saying that if you visited an ER you would be ok with an NP seeing you instead of an ER physician. And when you need to be admitted you would rather have an NP see you as opposed to an internal medicine/ family medicine hospitalist?

I hope that for the good of patient care we would continue to have good medical care and not resort to NP/PA for primary care/er/hosptialist medicine because I honestly dont think we would have good outcomes. I think NP's and PA's are fantastic. We have some that work in our group. But I think they may be overstepping in certain instances.

 

[ENT Doc]

Panscan wrote:

What does it mean physicians are aging? Are we training less doctors now than we did in the past? If not then how would physicians as a whole be getting older.

If anything we are pumping out more and more. Docs working later in life too I feel like.

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Check out the total graduates by year:

https://www.aamc.org/download/153708/data/charts1982to2012.pdf

It's really been in the past 5-10 years or so that there's been this push to get more graduates out there, which is why if you look at the last 8 years you see increases by about 2k from the prior baseline.  The average age of physician did go up in the last 4 years if you look at FSMB data.  This is consistent with your "docs working later in life" idea.

[Panscan]

What does it mean physicians are aging? Are we training less doctors now than we did in the past? If not then how would physicians as a whole be getting older.

If anything we are pumping out more and more. Docs working later in life too I feel like.

[ENT Doc]

Drsan1 wrote:

ENT Doc wrote:

While I’m a big fan of hospitalists I don’t think they are immune to the effects of the deluge we are about to experience from mid-levels over the coming decades.  The best thing primary care (including hospitalists and EM) can do IMO is prove that their degree is value add (research) and get in bed with or become the administration.

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It sounds like you are basically saying in the coming decades there will be no need for FP, IM and EM docs because ACP’s will be caring for all the patients in all these fields. Lets make a small wager of your ENT practice for my…

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Not sure where you got the idea that I insinuated that there will be no need.  Just a reduced need.  And this will be reflected in lower salaries.  Your competitive advantage can't be "no one wants to do what we do at the hours we do it".  Profit seeking mid-levels will be happy to put that to the test.

[Drsan1]

ENT Doc wrote:

While I’m a big fan of hospitalists I don’t think they are immune to the effects of the deluge we are about to experience from mid-levels over the coming decades.  The best thing primary care (including hospitalists and EM) can do IMO is prove that their degree is value add (research) and get in bed with or become the administration.

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It sounds like you are basically saying in the coming decades there will be no need for FP, IM and EM docs because ACP's will be caring for all the patients in all these fields. Lets make a small wager of your ENT practice for my...☺️

[RosieQ]

ENT Doc wrote:

While I’m a big fan of hospitalists I don’t think they are immune to the effects of the deluge we are about to experience from mid-levels over the coming decades.  The best thing primary care (including hospitalists and EM) can do IMO is prove that their degree is value add (research) and get in bed with or become the administration.

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If you are employed by the hospital then the extra profit from mid-level work will be lost, but if you own the group and can be on the cutting edge of this trend then I think we can grow with the times.

[ENT Doc]

While I'm a big fan of hospitalists I don't think they are immune to the effects of the deluge we are about to experience from mid-levels over the coming decades.  The best thing primary care (including hospitalists and EM) can do IMO is prove that their degree is value add (research) and get in bed with or become the administration.

[Drsan1]

CM wrote:

Drsan1 wrote:

The specialists love us! 

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I’ll corroborate that. Thank you dear hospitalist for all that you do.

In the late 90s I was badgered all night long. “The K is 3.0.” “Mr. Jones had a 10-beat run of NS-VT.” “Mrs. Jones was in sinus bradycardia down to 38 beats per minute. No, she is asymptomatic.”

I was in at 2 a.m. at least twice per week for chest pain or SOB or some such thing. Now I get none of that, thanks to the finest physicians on earth, our hospitalists.

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As I am at work right now and just admitted my one hundreth patient, and answered my one thousandth phone call (exaggeration of course) I say to all the specialist...Your welcome. I used to complain but I don't now. It is truly job security. There is no going back to "before Hospitalist" at this point.