Some doctors don’t like to admit it, but money can have a major influence on physicians’ behaviors.
For years, Medicare seemed to recognize this by paying doctors more for complicated patient visits and less for straightforward ones. In addition to properly compensating physicians for more challenging work, this payment schedule helped encourage them to take on complex, time-consuming cases.
The federal government recently announced plans to drastically alter Medicare payments to physicians by instituting a flat rate per visit, regardless of how sick a patient is. This change, which is slated to start in 2019, could have unintended — and harmful — consequences for patients with severe illnesses.
Mr. R is one such patient. He recently came to my infectious diseases clinic after a rare fungal infection developed in his lungs. He had undergone a liver transplant years ago; the medications that he needed to take to prevent rejection had made it possible for this life-threatening infection to take hold. His doctors were planning to admit him to the hospital for treatment, but they decided to send him to my clinic first.
His English and my Spanish skills were limited, so we spoke slowly, via an interpreter. As we reviewed his medical history in detail, Mr. R asked many questions about the cause of the infection and his odds of being cured. I conducted a careful physical examination to see if the fungus had spread elsewhere in his body; thankfully it had not. Finally, we discussed the next steps, which would include antifungal therapy and close monitoring for the next year. I explained that if the infection worsened he might still need to be admitted to the hospital, but for now he could be safely treated at home.
Mr. R’s visit was quite comprehensive, and lasted for more than an hour, so I later billed his insurance, Medicare, at the high rate reserved for the most complex patients.
Medicare currently pays doctors $211 for a new visit with a complicated patient like Mr. R, compared to $76 for the most straightforward cases. Under the proposed changes, the payment will be $135 for all new visits. That means I would be paid the same for spending a few minutes caring for a patient with a runny nose as for treating Mr. R.
The effects of this policy could be catastrophic. Doctors will be pressured by clinic administrators to see more patients each day to maintain revenue, which will encourage them to treat more patients with simpler problems and fewer with complex, time-consuming health issues. It’s possible that some physicians could send their sickest patients to nearby emergency rooms rather than addressing their issues in the clinic. Others may simply stop accepting patients with Medicare altogether.
Doctors who continue treating the sickest Medicare patients may see their incomes fall. Medical students, who are increasingly burdened with hefty debt after graduation, are already being drawn towards more lucrative surgical or procedure-based specialties and away from lower-paying jobs in primary care. Medicare’s flat-rate plan, by contributing to a decline in income among physicians who treat complex patients outside of the hospital, would likely worsen that divide and discourage trainees from pursuing much-needed careers in primary care and other specialties that do not perform procedures.
For patients, this policy shift could lead to fewer available doctors, longer wait times for appointments, and less time spent with the doctor at each visit.
To prevent these outcomes, improve care for vulnerable patients, and encourage more trainees to enter primary care and other undervalued fields, Medicare should pay more, not less, to doctors who treat the sickest patients.
By increasing payments for these visits, Medicare may still be able to cut overall costs. Allowing doctors to spend more time with the neediest patients can prevent hospital admissions and other costly complications. For example, Medicare would have paid thousands of dollars more had Mr. R been admitted to the hospital instead of visiting my clinic, and he would have been at risk for harmful —and expensive — hospital-acquired infections, blood clots, and other harms associated with an inpatient stay. Addressing his complex issues outside of the hospital was not only better for him, it was cheaper for Medicare.
Increasing payments to physicians who treat the sickest patients would be an investment in the future of a cost-effective and functional health care system. Paying doctors more for these visits would inspire young physicians to pursue careers in primary care, while also motivating existing physicians to provide valuable and much-needed treatment for the most complex patients.
Instead of broadly reducing reimbursement rates, Medicare administrators should consider how to better structure physician payments to help patients, reduce costs, and foster a sustainable Medicare system. Patients and their doctors deserve no less.
Timothy Sullivan, M.D., is an assistant professor of medicine in the Division of Infectious Diseases at Icahn School of Medicine at Mount Sinai in New York.