Question 1:  Do you know what capitation is and are you under such a plan?

Answer: Most people cannot answer either question. Capitation is a reimbursement scheme in which the physician receives a certain number of dollars per patient per month, regardless of any illness or visits on the part of that patient. At each visit, the patient may have a small co-payment such as five or ten dollars. The idea is to get the physician to conserve resources and to put a small disincentive in the way of the patient seeking unlimited services. This may become the dominant way of financing medical care because it is the most effective in limiting expenditures.

One problem is that accountants and actuaries set these rates very close to the overhead cost of providing minimal services. Typically, a primary care physician will be allocated between ten and thirteen dollars per month for the care of each patient. Some of this payment is withheld until the end of the year, in case the physician consumes to many specialist consultations or laboratory services.

The theory is that the physician will be conserving of resources and actively seek preventive measures as well as compliance with treatment. The reality is broader, because every patient with a chronic illness or recurring problems becomes a liability to the physician's practice. Instead of being paid for what they do, physicians are then, in some sense, being paid for what they do not do.

Question 2:  What is fee-for-service medicine?

Answer: This is medical care in which the patient is charged for each service. The physician or other provider is paid according to what is done, not a fixed amount. The problem with this method is the incentive to do the maximum, leading to very expensive medical care. Also, itemization of  innumerable inexplicable charges make it difficult for the patient to know what is being purchased.  Years ago, insurance companies enacted second opinion programs to be sure that expensive procedures were really needed. But it was impossible to track the many smaller charges which added a lot of cost to medical care.

Question 3:  What is a carve out?

Answer:  This is where a certain segment of the possible medical care you may need is farmed out to a particular medical group or facility. For example, even if your doctors are at a university hospital, all cardiac surgery might be under a carve out and might be done at a particular suburban hospital.

Segments of your care may essentially be sold off to the lowest bidder. Since most people do not expect to need care, few patients are aware of such arrangements when they sign up for their health care. There are areas of the country where there is a "spot market" in expensive procedures, such as cardiac surgery. The plan will call around to a number of hospitals to see which one is willing to do the surgery for the cheapest price on a given day and move the patient to that facility.

Question 4:  What is economic credentialing?

Answer:   This is a process by which health plans select physicians based on how much money they expend on patients in the course of diagnosis and treatment. The theory is that there is a median expenditure which is reasonable and that most physicians should fall pretty close to that mark. Insurers can track this information easily, based on claims submitted to them. Physicians who spend less are preferred over those who spend more. Unfortunately, it is not clear that those who spend less are practicing better medicine.

Question 5:  What is a preferred provider?

Answer:  This is a physician or other provider willing to accept reduced fees, with the goal of servicing a larger number of patients. This must by its nature result in more patients per unit of time and reduced attention to each patient.

Question 6:  What is deselection?

Answer: This is one endpoint of economic credentialing. Every year a health plan looks at how much each of its physicians have cost it. The plan may then unilaterally deselect any number, such as five or ten percent, of those who were the most expensive in terms of dollars spent per case. Contracts are written so that either the plan or the physician may terminate without cause. The plan simply writes to the physician stating that services are no longer needed. This does not need to be accompanied by any explanation.

Such practices have a chilling effect on all physicians in a plan, since large numbers of patients can be removed from their practices with a single stroke. All physicians in all plans are aware of this and are under constant pressure to ratchet down costs. At some point, this puts them, reluctantly, in conflict with the needs of their patients.

As large health plans consolidate smaller ones, physicians become dependent on them to a greater degree. As more and more physicians come under these strictures, patients are left with few places to turn for independent medical advice.

Question 7:  What is a gag rule?

Answer:  Gag rules state that physicians cannot advise patients with regard to  treatments not covered by a health plan, typically expensive interventions. Gag rules are being withdrawn by managed care plans, simultaneous with many state legislatures and the federal government outlawing such clauses, because they have provoked public outrage.

However, the threat of deselection functions as a de facto gag rule, since the patient who involves too many patients in expensive care will likely wind up terminated by the plan whose patients are under such care. This forces upon providers a conspiracy of silence.

Question 8:  What is a gatekeeper?

Answer: A gatekeeper is the primary care physician assigned to each patient in a health plan. The gatekeeper is the first point of call for problems, many of which were formerly handled by specialists. This appropriately reduces the cost of care in many instances. The referrals and resource utilization in terms of tests and medications are tracked in great detail by the heath plan.

Unfortunately, the gatekeeper is under tremendous pressure to limit referrals, tests and treatments because of the process of economic credentialing and the threat of deselection. This may result in delay in diagnosis and treatment.

Question 9:  What is a withhold?

Answer: A withhold is an amount of money due to your physician under arrangements with the managed care orgainiztion. This sum is held back until the end of a period, typically a year, to be sure the physician stays within targeted figures for expenditure. If the doctor does not spend over this figure on patient care, the sum withheld is paid as a lump sum or bonus. If expenditures for patient care are over the target figure, the physician does not get paid this portion of earnings.

Question 10:  What is a traditional medical examination?

Answer:  This is the old fashioned thorough examination performed by a personal physician, typically either an internist or family practitioner. The traditional medical examination has usually taken about an hour and has gone far beyond the mechanics of an examination.

The physician would deal with the social and emotional well-being of the patient, family and work related matters, and get to know the patient as an individual. The physician related with the patient as person who might have a problem, not as a problem which happened to have a person attached. The new health care organizations cannot provide this kind of care and caring. As patients move into managed care, even with the same physician, they find this care is no longer available.

Question 11:  Can I ask my physician for the old fashioned type of medical examination?

Answer: You cannot if your physician is part of your health plan. Remember, the physician has agreed to abide by the rules and protocols of the health plan and may not charge for services outside that agreement. Services within that agreement are provided at a discount, so the physician must keep people moving through the office. In this instance, your only choice is to go to a physician who is not part of your health plan . If you wish, you can establish an ongoing relationship with the American Health Advisory Center to receive such an examination at whatever interval you may choose. The report of this examination may be used by your gatekeeper to assist in your medical care under your health plan.

Contact DrRobinson@MD-1.com for further information.
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