Office Visits Do Not Break the Bank But Insurers Can

Small health care has managed to survive despite impairment by financial design. The Big Squeeze has long been in play. There too many ways for Big to Win and Small to lose. Innovation worship and inconsequential reforms gain headlines while few look critically at health care designs. The consistent finding is that health care entities less organized, smaller, and most distant lose. Those largest, most organized, and shaping the designs win. This is the American health care way.

Of all the forms of inequality,  
injustice in health care is the most shocking and inhumane.
Martin Luther King, Jr. 



New Ways for Big to Win and Small to Lose
If you are small compared to Big Health, and face higher costs of delivery due to supplier inequities, and get paid less where you practice by government and insurers, and get paid even less because you dare to care for people in most need of care...

You Are Caught in the Big Squeeze
More Observations

There is little or no competition in places where 30 - 50% of Americans are found - the most complex and underserved Americans.

Note the decades long move to fewer insurers. This leaves remaining insurers with greater market share - and more power to determine who lives, who dies, and who they buy out for best profits. Insurers such as United or Blue Cross that are stuck with the wrong populations or locations - just dump out of the market. This also leaves fewer insurers that can pay less and demand more in premium.

One of the only ways to increase office payments where primary care is most needed is to be bought out by a hospital or large practice - if you can find one that wants your practice.

Unfortunately if you sell out to big, you sell out your community as those bigger and distant have entirely different priorities rather than addressing local patients, situations, and resources.

The Small Fish in a Big Pond loses. The Big Fish in a Small Pond wins. 

Health care works for those most concentrated. It is not a surprise that so many different corporations and entrepreneurs want to get a slice of the health care pie. If you understand the rules, you can play to win - big. If you get into health care to care for people in need of care, well this can be a challenge in more ways that you can assess.

There are many confirmations of the discrimination that goes on. You can categorize this by size of provider, by type of location (rural, lower concentration, underserved), level of organization, or other categories but it always ends up the same. If you are smaller, less organized, distant, and have the most complex populations - the government, insurance, and academic designers have been driving you out of small practices and small hospitals for decades of designs.
  • Lower payments for generalist and general specialty services
  • Lower payments in states most behind in workforce
  • Lower payments in counties most behind in workforce (with few or no hospitals)
  • Lower payments for small practices
  • Lower payments where insurers are bigger
  • Lower payments via Pay for Performance for small, underserved, rural, or most complex care
The biggest and most advantaged for private insurance payments can expect 90 - 100 dollars for basic office services while Medicare pay is less than $60 in some states and locations with Medicaid even less. 

Medicaid – well we can just hope that there is some payment in the future from Medicaid but it has always been a loss leader.

Six Degrees of Discrimination By Health Care Payment Design will need some editing and additions


As a Reminder, This Quote from Jim Purcell was directed by him to fellow CEOs, physicians, and execs in health systems and insurance:

“Permit me to share a truth with you. OFFICE VISITS NEVER BREAK THE BANK! Never. It’s the lack of office visits which exacerbate already existing chronic situations that result in in patient hospitalizations and specialist involvement over extended periods that break the bank. The other item that breaks the bank is the leveraged whammy of untreated combined psychological and physical health maladies which are the single biggest driver of fee for service Medicaid expenditures today. Again, office visits never break the bank.” Jim Purcell in The Health Care Blog


Unfortunately those doing well have found that Cherry Picking works and this can work very well by
  • avoiding mental health patients or high mental health populations
  • avoiding primary care practices with more complex patients 

This works for the larger practices and systems that can change locations to avoid such patients.

This works for health insurance corporations.

But this does not work for most Americans behind by more designs than can be tracked.



Recent Blogs 

Why Prevent Doctors and Nurses from Teaching and Nourishing?

Office Visits Do Not Break the Bank But Insurers Can

Necessary Rather than Disruptive Transformations

Ending the Disruption of Pay for Performance and Payment Plans that Lack Evidence Basis and Discriminate

Best of Basic Health Access Blogs

Do Family Medicine Leaders Deserve the Trust of the Students Choosing FM?

Family Medicine Leaders Must Move Access Forward Not Backward

Readmissions Better from ACA or Preexistingly Worse from DRG?

Does Academia Compromise Health Care for Most Americans?

Demographics Distributions and Discriminations in Health Care

Demographics Against the Democrats

Not Easy Being Swiss Cheesy in Health Info Tech

The 25th Anniversary of the COGME Third Report and No Change By Design

Why Is Value So Hard to Recognize in Health Care and why does family medicine not value family physicians and the high value places where they practice

The Four Horsemen of the Primary Care Apocalypse - Medicaid, High Deductible, Veteran, and Medicare Plans shape failure by payment design

Plea to Academic Leaders - Please No More So Called Primary Care Solutions - No Training Intervention or Practice Rearrangement Can Work without Payment Reform

What Is Stunning in Primary Care Is No Change By Design - Numerous failed attempts to recover primary care all point to insufficient payment made worse by accelerating cost of care. 




Robert C. Bowman, M.D.        Robert.Bowman@DignityHealth.org

The blogs represent the opinion of the blogger alone.

Copyright 2017

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