Vaccines may be saving the lives of children, but they are killing the docs who give them. Pediatricians have to pre-purchase tens or hundreds of thousands of dollars of vaccines, insure them while they sit in the fridge, and then are often paid at or less than what they paid for the vaccines themselves when administered weeks later. If a mom changes her mind after the imm has been drawn or the kid fights it - there's $75 down the drain. Gardasil is a great example: many insurers still don't cover it fully! - so the practice is supposed to eat the few hundred bucks? Or, how about the flu vaccines? Patients fill the phone lines of the offices looking for a shot...that the docs can't fill until after the rush is over...meanwhile, Wal*Mart and the retail clinics often got their deliveries on time.
That just makes no sense. Enough pediatricians are feeling the pinch, however, that we're seeing movement. One solution is to check out the numerous vaccine buying collectives (Physician's Alliance, Pediatric Federation, and Main Street Vaccines come to mind).
To the AAP's credit, this is one issue they are doing something about. I just hope they can do something in time.
Meanwhile, here's a summary of the problem from the latest issue of Infectious Diseases in Children. It provides more data to match the vignettes from that NY Times piece from a few weeks ago (featuring PCC clients and friends alike). In the IDC article, they recommend:
- Fix vaccine administration fees; this includes collecting data on the costs of delivering vaccines in private practices, getting support on methodology from the Centers for Medicare and Medicaid Services and using the data to educate insurers and Medicaid on appropriate reimbursement.
- Work with vaccine manufacturers to obtain more favorable terms for the initial inventories of new vaccines.
- Work with federally qualified health centers to delegate authority to serve underinsured children through the Vaccines for Children Fund at public health department clinics.
..which is a pretty good list, if you ask me. Yes, there are other changes I'd recommend, including:
Frankly, I think it would all be easier and more appropriate if all vaccines were VFC. That will never happen, though, as long as the pharms can make good money.
I have to come up with an analogy for the Great Medical Insurance problem here in the US. The Rebels vs. The Empire? Robin Hood vs. The Sheriff of Nottingham? David vs. Goliath? None of these is just right, but they each contain elements of the issue: a giant, controlling source of pain and trouble being fought by the little guy (or woman - see below). It's a matter of time before we see the Erin Brokovitch movie about the insurance industry.
What a delight it was, then, to read this month's SOAPM newsletter (past issues are available at the AAP as well as at PCC, as we sponsor the newsletter). First, I read Dr. Francis' piece reminding pediatricians to go to hmosettlements.com to participate and keep an eye on the settlements with Aetna, Healthnet, Wellpoint, Humana, and Cigna. Just go read the entire site.
Even better was the description, from Dr. Stoller, of how she discovered Aetna was in violation of their settlement terms and, through just a little work, was able to recover a significant amount of income relating to -25 modifiers as well as mis-processed "out-of-network" claims (that were really in-network). As she says, "FIGHT BACK!"
Then, I got the email:
Good work. My favorite part of the email reads as follows:
This latest national class-action settlement is one in a series of actions against major healthcare insurers and another milestone in the check against widespread and chronic abuses against physicians. These class-action lawsuits have resulted in significant reforms in the health insurance industry.
The settlement consideration includes a guaranteed cash payment of over $128 million to class members. In addition, the settling defendants have agreed to implement important business practice changes that will bring the estimated value of the entire settlement consideration to well over $1 billion.
Perhaps an Austin Powers analogy would work? "One Billion Dollars."
It gets better, though:
The agreement follows similar settlements with other major managed care companies, with the exception of United Healthcare, who continues to litigate against physicians rather than making the kinds of positive practice changes other insurers have agreed to make.
Indeed, United Healthcare has repeatedly refused to address the significant concerns raised by representatives of the more than 400,000 physicians nationwide who care for United Healthcare's members. According to MSNJ CEO & Executive Director, Michael T. Kornett: United Healthcare simply has not raised its standards to what has become the industry standard in healthcare. United Healthcare has systematically engaged in practices of coercion and intimidation that are akin to the actions of a school-yard bully. When all the other major national healthcare insurers agree to conduct business with their physician/providers in a more transparent and fair manner, it is difficult to understand why United Healthcare refuses to operate on a more level playing field.
Wow. Although I assume it actually isn't difficult for anyone to understand why United behaves this way, kudos to the Medical Society of New Jersey for stepping up.
Well, sadly, not more reimbursement. That's the problem. More about it.
From the Washington Post, we have another piece similar to last month's NYT article about the problems with immunization reimbursement for private practice pediatricians. It would be hard to overstate the importance of this subject in our world these days. Dr. Lessin is quoted again, so those coming to see him at our Users' Conference should expect more of the same (he's no shrinking violet):
I have to pay for nursing time, supplies, syringes, alcohol pads, dropped doses and time to explain it," Lessin said of the ancillary costs of providing vaccines. "And when insurance companies decide to pay me $122 per dose and take three months to pay, I can't afford to do it. For insurance companies that are paying me $140 or $150 a dose, I'll give it."
I then got a message about Beechstreet's continued lowball reimbursement for some key imms (like ProQuad at $35 or something like that when it costs >$100/dose to purchase...someone correct me if I'm wrong). Given all the other problems with Beechstreet, I often wonder why practices even participate with them.
In 2007, CMS gave values to two important pediatric codes for the first time, the 92551 (hearing test) and the 99173 (vision screen). Sure, the values aren't astronomic, but that extra ~$10 for each test, which are part of a standard well visit, means a lot to a pediatrician.
Then along comes Oxford.
E & M Utilization
Several recent changes to OXP policies related to E & M coding include
bundling the vision screening code 99173 into visit codes. This became
Yeah, we'll just ignore CMS entirely and, retroactively, deny paying for a fundamental preventive care procedure. You know, one that could save the vision or hearing of your child.
Sigh. This is, of course, one of hundreds of these little missives our clients get throughout the year.
How do I even know about this? Because of the lovely work by The Verden Group. Ignore that silly quote on their front page (I wasn't paid a dime, I promise!), it's a very cool service.
How do I feel about pediatricians billing for phone calls, writing off weekend charges, etc.?
Apparently, a conversation I had with an organization years ago just got republished in Contemporary Pediatrics' on-line resources. For the life of me, I don't remember speaking to the author about it, but some of the attributed quotes have certainly come out of my mouth, so it's legit. Just funny to see it happen like that. What's remarkable is how well the quotes hold up - not a tribute to me, but how little has changed in our business:
"You're telling people that if it doesn't cost them anything, it's not worth anything," says Hart.
Not enough time is spent thinking of pediatric offices as small businesses. There are lessons learned in other businesses that pediatricians can and should apply to their own. If you spend any time around me (or PCC) you'll eventually hear a sermon or two about Open Source Software (OSS). Small pediatric practices can't usually afford the entire MS Office suite, for example, or suffer the consequences of allowing their staff to use Outlook and IE.
Here is a good piece from CNET about alternatives to Ms Office. I've used OpenOffice (one of their examples) for years without a problem. I originally switched years ago when an Excel spreadsheet kept giving me addition errors(!) but, when I opened it in OpenOffice, everything worked. I haven't gone back since.
If you're a pediatric practice running a stack of PCs or Macs, think about using alternatives to MS Office. They're cheaper and, often, better. There are also plenty of other OSS packages that we recommend for practices as well (Firefox, Thunderbird, Clamwin, SpyBot, Inkscape, Gimp, Pidgin, etc.). It could save you a lot of money and grief.
These links provide some good overviews of OSS or free (which is different!) software:
I have grand plans for a series on pediatric benchmarks. Tim and I have been working feverishly on a series of WWW-based tools for our clients and our hands are dirty with all sorts of tidbits that I hope to share.
If I were smart, which I am not, I would start small and build up a series of benchmarks, culminating in an overflowing abundance of pediatric data that the world has never seen. But, like I said, I'm not smart, so I'll just jump into one thing I found fascinating:
...I'm sneaking in a bunch of benchmarks at once, so read closely.
First, you get the average charged, per visit, by PCC customers (the pediatric ones) in both 2003 and 2006. Then, you get the average revenue/visit for both years. This is gold in the benchmark business.
But we took it a step further and removed the revenue that comes from immunizations. Not the admins, just the vaccines themselves. This allows us to compare practices who purchase everything to those who purchase nothing (like VT pediatricians) and the majority, who are somewhere in between.
What do we learn?
I suspect that most of the readers of this blog are already well aware of PedTalk, the original and longest-running public pediatric discussion group. If you're not familiar with the mailing list, here's the summary: started in 1996, archived publically since 1997, usually somewhere between 350 and 600 active readers with thousands of visits to the archive every week.
I mention PedTalk because the list, right now, is on fire with some great discussions relating to insurance in particular. It's one of the few places on-line where you can really read a practicing pediatrician's view on immunizations. Or hear how United Health Care, whom I pick on often, is actually well regarded in different parts of the country. Or read, like here, the real stories of practices who have negotiated with insurance companies.
From today's New York Times, a piece about the use of loans to pay off expected medical balances, a couple choice quotes:
Zero-interest financing, a familiar sales incentive at car dealerships and furniture stores, has found its way to another big-ticket consumer market: doctors’ and dentists’ offices.
But as the price of health care continues to rise and big lenders pursue new areas for growth, this type of medical financing has become one of the fastest-growing parts of consumer credit, led by lending giants like Capital One and Citigroup and the CareCredit unit of General Electric.
Now, for the scary one:
UnitedHealthcare is also testing a medical credit card that would offer reduced rates.
Does anyone, anywhere - except the employees of UHC and their spouses - think that United's appearance here will benefit the patients or providers? Especially pediatricians? Given that the credit card HSA patients are using to pay their bills is owned by a bank that is a subsidiary of UHC, UHC makes money coming and going. It's truly immoral.
What does this have to do with pediatricians? I think peds should offer payment plans much like OBs and dentists have done for years. SKIP THE MIDDLEMAN. When a woman gets pregnant, what do many OB offices do? They bill the family monthly, knowing there's a multi-thousand dollar bill at the end that most folks can't pay at once. OBs get their money up front. What do orthodontists or dentists do? They let you spread your payments out. You pay throughout the entire process and for months after. Why? Because they'd rather get their thousands of dollars over time than have you chose not to do the procedures at all.
Why not peds? Each newborn who hits your practice should have, booked, a dozen visits in those first 24 months. With all the imms, they are expensive visits. Run some quick numbers on your office and you can accurately estimate the medical bills for the first 2, 3, 5? years that a patient is in your practice. Why not get your parents signed up to a plan whereby they pay a fixed amount each month and you guarantee that you'll see them for their visits? Even if the monthly amounts don't actually cover the full expected charges, it gives patients financial incentives and reminders to come in. I'm not suggesting you write off any shortfalls in the payment plans!
If you aren't convinced, think about the HSA plans in your office. A patient comes in to your office 2x in January and racks up $600 in bills...but the employer hasn't funded the HSA plan well, so the patient has to pay the entire thing truly out of pocket. Wouldn't it be better to say, "We'll charge you $200 a month for the rest of the year and let's book your 6month PE now and perhaps even your 1Y. At that point, we'll settle up the difference." You've got $1,200 in payments ensured and 2 more important visits in your appointment book.
There are other ways to structure the process, but the idea is simple. Other folks are using it and peds have an "expected utilization" path that should be easy to monitor.
Is there any reason to give UHC part of this pie?
Here's a great press release to start your day! Some important excerpts for those who don't make the jump:
The [payment] disparity is forcing pediatricians out of business and may be
prompting the next generation of physicians to choose other specialties. "I
love caring for children; it's the best job in the world. I don't want to
see our best doctors shying away from pediatrics because they know that
they can make a better living in almost any other specialty," said Anthony
That's exactly how many of our clients feel. Great quote. It's not almost any other specialty, though, it's every other specialty. Well, except podiatry.
Another good one from Dr. Mirkin:
In some cases, the reimbursement I receive for an immunization has
been more than 20 percent below the wholesale cost of the vaccine, and this
doesn't take into consideration the administrative, stocking and other
costs associated with vaccines," said Dr. Gary Mirkin of MDs4Kids in Great
Neck, NY, and CEO of Allied Pediatrics of New York. "I've been forced into
a role as an underfinanced public health agency as the health plans, in
effect, take advantage of my dedication to my patients.
Again, spot on. Keep up the good work.
What does concern me is this data from the article:
Medicare reimburses physicians almost 15 percent more than it did in 2001 for the more complex office visit, code 99214 (from $92 in 2001 to $105 today), yet
reimbursement from the commercial insurance carriers for the same code
during this period has actually fallen 1.5 percent, from $65 to $64.
As a result, Drs. Mirkin, Battista, and 50 other peds have been putting together a single, large pediatric group (for some time now) in an effort to fight these shrinking reimbursements. I've written briefly about our experience with mergers and we generally caution against them for a variety of reasons.
What does that have to do with the data? Well, PCC's clients, in a much smaller time frame (2003-2006 vs. 2001-2007) have seen their average 99213 and 99214 reimbursement go up 11% and 14% respectively. So, while Dr. Mirkin's peers are watching their reimbursements fall, our customers watch them rise. If I were to go back to 2001 and include 2007, the increases would be even higher.
Why? Because our clients negotiate. I know at least two practices Allied Ped's has approached who have negotiated significant increases in the last year, particularly for E&M codes! These aren't particularly large practices, simply practices who have done their homework and learned to say no. I sincerely hope that all the time, effort, and money (mostly to lawyers) that Allied Peds spends leaps their reimbursement beyond what their next door neighbors are doing on their own.