In a recent article in Forbes Magazine, John R. Graham wrote:
"But few of these [small medical practices] will survive Obamacare. Practices small and large are being bought by hospitals and health plans, and most observers agree that few independent practices will remain if Obamacare survives its legal and political challenges."
There is simply no way to be tactful in response to this statement. It reeks with dishonesty.
In a recent article in Forbes Magazine, John R. Graham wrote:
"But few of these [small medical practices] will survive Obamacare. Practices small and large are being bought by hospitals and health plans, and most observers agree that few independent practices will remain if Obamacare survives its legal and political challenges."
There is simply no way to be tactful in response to this statement. It reeks with dishonesty.
Small medical practices across America are in trouble, deep trouble, already. Their troubles have nothing to do with the coming of "ObamaCare," which is more than 2 years away.
As the Administrator of a small internal medicine practice, I can share my experience, which I am sure is the same as that of many small medical practices. The failure of small practices are due to the following:
Reimbursement to primary care physicians has not increased at all in the past 20 years; at the same time the cost of health insurance is up 131% over the last 10 years. The massive role of the insurance company in health care serves no purpose other than to transfer money from the health care providers to a group of people who provide no services, yet saddle the small practices with mountains of paperwork and regulations. Yet these are the very same "industry people" who consistently complain about "government regulations."
The administrative costs of dealing with private insurance can be as high as 14% of annual revenue. As a practice administrator, whose practice sees nearly 70% Medicare patients, and 30% private insured patients, we incur a cost as high as 7% just to be able to submit our bills to these private insurance companies. Let me repeat, the 30% of our patients who are privately insured are in fact responsible for nearly 90% of our billing related expenses.
Related to the above, every insurance company has its own set of rules. Every insurance company has its own set of tricks to delay and/or avoid payment to a physician for as long as they can. One such trick is the "we need your Tax ID number trick." This usually occurs at least once a year, from a company that has been sending the practice checks for the past 8 months. How is it, all of a sudden, they need the Tax ID before they can send out the next check? Did all the Tax ID's in their computer system get erased by the IT intern? I doubt it. Every doctor in private practice will tell you the same story: there is no greater threat to their existence than the Health Insurance Industry; ObamaCare is yet 2 years away.
To get a grasp of the shocking amount of money sucked out of the health care marketplace by insurance companies one only has to look at the retirement package provided to former United Health care CEO "Dollar" Bill McGuire, who was walked away from his health insurance company with more than $2 billion in his retirement package. This same pattern is par for the course in private health insurance companies. The median CEO pay in 2010 was $10 million dollars.
To use a Matt Taibbi description: The health insurance industry is a giant vampire squid wrapped around the heart of the American health care system, relentlessly jamming its blood funnel into anything that smells like money.
If one places this income inequality in the context of the recent CBO report, it is easy to see the stark contrast in the health care industry when you compare the income gap between the "providers of health care services" to that of the insurance company executives, with the providers being to do more and more for their patients, while the insurance executives compensation continues to escalate.
But to read Mr. Graham, it is ObamaCare that will kill small medical practices...ObamaCare will not kill any small practice, they will already be dead!