As a lifelong student of medicine, I’ve spent many hours learning and absorbing the latest and most up-to-date medical practices to ensure that my ability to deliver care to my patients remained at the highest quality. I also prided myself in being a student of the history of medicine and the methods of the trail-blazers before me. It was earlier on in my career I realized that in order to be a complete physician, not only did I need to know the practice, itself, but I also had to learn the system which surrounded it, along with its history. With that realization, I began to dive deeper into learning the policies and procedures of our own healthcare system, and what I learned was staggering. Our system, as we know it, has possessed flaws since its inception. Unfortunately for us clinicians, the media and politicians often only highlight the effects of the flawed system on the patient, (and to some extent rightfully so) which mean that the effects on the physician are inherently understated and underwhelmingly represented. As you continue reading below you’ll find a snapshot of two programs that often affect us the most, Medicare and Medicaid. Read it with an open mind and think to yourself, “How does that affect me?” Because whether you know it or not, it does.
The Historic Flaws of Medicare and Medicaid
Wilbur Mills (D-AR), then Chairmen of the House Ways and Means committee during the 1950s, was leery of the cost of an open-ended healthcare benefit that was being proposed by several members of Congress. He was also a sponsor of the Kerr-Mills Act of 1960, a plan which provided federal funds to the states to provide care to the poor elderly. However, the plan was not effective. With the Democratic landslide election in 1964, Mills knew that President Johnson had the votes to pass an open-ended healthcare bill for the poor and elderly; Mills overcame his reticence and proposed then effectively led passage of Medicare and Medicaid. But, his concern (about cost) has plagued this nation ever since.
So what are these major issues of Medicare and Medicaid as we know them today?
1) No growth plan: Medicare has no growth plan, there is no trust fund that grows over time, but rather, there is an input of funds that are expended the day they are received. Thus, with increasing healthcare capabilities over time and increased life expectancy, expenses have increased to the point where the per person cost is roughly three times more than the actual contributions of any one individual. Three times! And so you ask, “how is the deficit accounted for?” The deficit is absorbed by the succeeding generation(s).
2) Lack of knowledge about cost: Individual Medicare/Medicaid consumer(s) are far removed from any concern about cost. In essence these consumers are spending everybody else’s money. Imagine, if somehow, Medicare was directly tied to the consumer’s income or available funds? Do you think that the consumer would change their behaviors in how they access healthcare? Perhaps become more frugal and access the correct sites of service? Maybe, but who knows.
The problem here lies in the education of what Medicare actually is and the most appropriate way to utilize it. Not only does this affect patients, but healthcare professionals as well. Think about it, why do these systems now scrutinize every expense when 5-10 years ago there were less regulations? Easy answer, uncontrollable cost.
Medicaid’s major flaw lies within its Federal-State structure.
3) Low Reimbursements: As a result of inefficient practices and miscommunication, between the federal government and the states, Medicaid’s reimbursements are so low that recipients are forced to use emergency rooms as their primary physician, which is an expensive option. Interestingly, the healthcare outcomes for those on Medicaid are no different than the uninsured despite the billions expended. However there have been examples of Medicaid patients receiving excellent care when spending monies deposited into their own special health account.
Do you see a trend here? (Hint: It has something to do with cost)
So how has the government addressed this?
In 1983 Congress initiated hospital price fixing under the term Diagnostic Related Groups. As a result, costs continued to increase.
In 1992 Congress created a price controlled scheme for physician payment called the Resource Based Relative Value Scale and its ever-changing CPT codes. Costs, again, continued to increase.
In 1997 Congress, again trying to control physician costs, passed the Sustainable Growth Rate plan. It was a failure and was repealed in 2015 at even greater cost.
In 2009 the introduction of the HIGHTECH Act, which forced physicians and hospitals to use “certified” computer programs instead of allowing them to shop the market caused many practices an unnecessary and unneeded expense. Again, the costs continued to increase.
Lastly, in 2010 the Patient Protection and Affordable Care Act was passed to control costs and provide universal coverage. It has failed
Instead of dealing with the fundamental problems (refer to #1-3 above), our government has repeatedly imposed additional controls and has consistently and unfortunately failed with every attempt.
So what’s my point here? It is in your interest to understand these structural flaws in Medicare and Medicaid. The point is that this is what they don’t teach you in medical school nor in your residency programs. The point is that these payment structures directly affect you, the physician. While there isn’t a ton anyone individual can do to change the overall structure of our payor system, it is my hope that by encouraging you to learn about the history of the system, it will empower you with the knowledge to make smarter decisions with your own practices, and in turn, positively affect where the system will go. I encourage any student of medicine to not only learn the sciences but to learn the history of the health care system and absorb it. Solidify your knowledge by learning from the mistakes of the past. And maybe, just maybe, we can ever so slightly make strides towards a safer and more efficient system.
There’s an old Buddhist saying that goes, “If you want to know your past, look into your present conditions. If you want to know your future, look into you present actions.”
For a more detailed analysis and suggestions for reform see my new book available electronically here.
Kenneth A. Fisher MD is a Board Certified Nephrologist, consultant, and author. His received his medical from The George Washington University. He is the author of Understanding Healthcare: A Historical Perspective, In Defiance of Death and The Ten Questions Walter Cronkite Would Have Asked About Health Care Reform. Connect with him at www.drkennethfisher.com or on LinkedIn.