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.

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

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.

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