While having lunch the other day, I was talking with two
physicians, one retired from active practice and the other having practiced for
close to 30 years. The conversation turned to physicians today and the
financial difficulties they face. Retired Physician was a Cardiologist. With
steady decrease to medical reimbursements over the years, Retired Physician
made less money each year he practiced, while his skill and expertise
increased. Since medicine is paid by a piece meal basis, payment is for each patient
served and the only way to make more money is to see more patients, physicians are
burning out and going broke.
This isn't a big secret; a recent CNN piece noted that “[t]his quiet reality, which isspreading nationwide, is claiming a wide range of casualties, including family physicians, cardiologists and oncologists.”
As
our conversation continued, Retired Physician lamented that as his practice
grew (at one point there were 49 employees), his pay and his partners' pay
continued to decline as more money went into payroll, benefits, malpractice and
overhead. Even though he had never been sued, his malpractice insurance premiums continued to rise
each year. What finally made him retire was when he had to make a decision
about which long-term employees to let go (some had been with the practice for 20
years) in order to stay in business, or what benefits to cut in order meet other
financial requirements.
“Dr. William Pentz, 47, a cardiologist with a Philadelphia
private practice, and his partners had to tap into their personal assets to
make payroll for employees last year. "And we still barely made payroll last
paycheck," he said. "Many of us are also skimping on our own pay."”
What we
all agreed on was that with the low reimbursements and growing federal
regulations, medicine is not the once-lucrative business that had attracted our
best and brightest. Today’s physicians will face a lower standard of living due
to higher debt to pay back and lower incomes.
“Doctors list
shrinking insurance reimbursements, changing regulations, rising business and
drug costs among the factors preventing them from keeping their practices afloat.
"Many are too proud to admit that
they are on the verge of bankruptcy," she said. "These physicians see
no way out of the downward spiral of reimbursement, escalating costs of
treating patients and insurance companies deciding when and how much they will
pay them."”
Medicine
in America, motivated by success, had become the stalwart in the world. Our physicians,
considered to be the leaders in medicine, had breakthroughs that have increased
our life spans and our quality of life. Diseases, once life sentences, have
been conquered and others have treatments that allow individuals to continue to
live productive lives. How have these men and women been rewarded? By facing constant
cuts to their very livelihood, they may not be able to continue to practice
their chosen profession.
““On average, there's a 10% to 15% profit leak in a
private practice," he said. Much of that is tied to money owed to the
practice by patients or insurers. "This is also why they are seeing a cash
crunch." "The economics of providing health care in this
country need to change. It's too expensive for doctors," he said. "I
love medicine. I will find a way to refinance my debt and not lose my home or
my practice."”
As we
ended our lunch - a retired physician, a still practicing physician and a health
care executive - we hoped that the business and profession of medicine would not
end, but continue to grow and prosper.
“Federal law requires that
Medicare reimbursement rates be adjusted annually based on a formula tied to
the health of the economy. That law says rates should be cut every year to keep
Medicare financially sound.
Although Congress has blocked those cuts from happening 13 times
over the past decade, most recently on Dec. 23 with a two-month temporary
"patch," this dilemma continues to haunt doctors every year.”
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