1. Increase in high-deductible healthcare plans, low reimbursement rates and uninsured patients. As the economy continues to struggle, copays and deductibles on many patients’ healthcare plans also continue to rise. Alan Davidson, executive director of the Orthopedic Institute of Pennsylvania in Camp Hill, says that this trend can lead to many patients not paying their copays at the time of their procedures.
Don Love, administrator of an orthopedic practice in Roanoke, Va., mentions several ways in which practices can help collect payments from patients, including pre-screening each patient’s insurance benefits prior to the office visit to determine coverage eligibility and collecting copays at the time service is rendered. "It is important to help patients understand and be aware of what their copays and deductibles will be," he says.
Mr. Davidson agrees that increased attention to the workings of the revenue cycle will help combat this problem. "Staff must be trained to collect these payments at the time of service," he says. "Some insurance contracts provide obstacles to timely collection, and these clauses must be negotiated out of payer contracts."
Ken Austin, MD, an orthopedic surgeon in Airmont, N.Y., also notes that insurance companies can "place obstacles in the way of healthcare for both the patient and the practitioner." These obstacles include underpayments for procedures and excessive paperwork.
In addition, Dr. Austin notes that many patients have employers who constantly switch healthcare providers, and oftentimes the patients are not aware of what their requirements are as they change from plan to plan. "Insurers make it as difficult as possible for patients to understand," he says.
As the unemployment rate increases, practices will see the number of uninsured patients rise as well. Mr. Love says that his practice saw uncompensated procedures increase significantly from 2007 to 2008. According to him, it is important for physician practices to evaluate the amount of uncompensated care they can provide without creating a strain on the financial condition of the practice.
2. Hospital lobbyists and potential new legislation. One challenge orthopedic and spine practices may face in this economy is the work of lobbyists in the federal government. "This economy strengthens the resolve of the American Hospital Association to lobby hard to remove physician free-enterprise rights, dubbed by the AHA as ‘self-referral,’" says Mr. Davidson.
According to Mr. Davidson, recent media coverage (such as this N.Y. Times article "Good or Useless, Medical Scans Cost the Same," published March 1) has included statistics provided by lobbyists to make the case that orthopedic imaging procedures are "high cost, high volume and clinically unnecessary."
In addition, he notes that there is a real concern about ancillaries and short-stay hospitals, and even ASCs have been attacked in the press. "There are studies that have shown that specialist physicians tend to order appropriate images and consequently fewer repeated images," he says. "Additionally, a Blue Cross Association study showed that competition among imaging centers tends to lower pricing (Blue Cross plans negotiate lower payments to providers), and this negates any effect of increased imaging volumes. These studies and accurate factual information need to be disseminated to the public."
Mr. Davidson also says that studies show that physician-owned hospitals provide cost-effective, high-quality services. These studies need to be pushed to the forefront to counter the information that has been manufactured to support anticompetitive positions.
"Physicians who have exercised free-enterprise rights and who have invested in hospitals and equipment stand to lose those investments and their free-enterprise rights with the strokes of legislative pens," says Mr. Davidson. "Patients stand to receive lower quality and, in many cases, higher costs with decreased access consequent to the eradication of these well-organized and focused orthopedic services."
In order protect their free-enterprise rights, Mr. Davidson encourages orthopedists to become more active in politics and to improve their own lobbying efforts. "Physicians need to reeducate legislators concerning the central role of the physician in healthcare," he says. "They need to dispel the notions that have been fostered by lobbyists and are imbedded in some politicians that physicians are untrustworthy because they wish to foster competition in healthcare."
Dr. Austin agrees that there is a trend in politics today for the government to take more control over healthcare. "Some politicians tend to think, ‘we’re the government; we know better,’" he says. "However, that can be the quickest way to create problems."
3. Demonstrating quality care. As patients become more cautious with their money, they will put higher stake into finding the best quality of care. Web sites, such as HealthGrades.com, make it easy for patients to find reporting of a physician or hospital’s quality of care. Mr. Love suggests that practices should take a proactive approach to collect their data to demonstrate quality, efficiency and level of patient satisfaction.
4. Retaining staff. A struggling economy may cause orthopedic and spine practices to closely monitor their staffing expenses, which may lead to salary cuts and layoffs. In addition, many practices may be faced with choosing savings over the quality of their staff.
Mr. Love says that "highly motivated and competent staff are one of the keys to a practice’s survival."
Dr. Austin agrees.
"It can be an ongoing challenge to maintain high-quality staff in a time of diminishing reimbursement," he says. He says that administrators and surgeons should stay in touch with their staff and handle any issues as they arise.
5. Managed care contracting. The state of the economy may make negotiating managed care contracts more difficult for orthopedic and spine practices. According to Mr. Love, health insurance payors who have more than 25-30 percent of a given market will make it increasingly difficult for practitioners and physicians to negotiate those contracts. "Those payors will have a take it or leave it attitude with physicians."
Mr. Love sees no easy solution to this problem, but it is important for practices to be aware of what this challenge will mean in terms of cost and revenue.
