AFTER OBAMA CARE IS DEFEATED GET READY FOR "Accountable Care Organizations"!

AFTER OBAMA CARE IS DEFEATED GET READY FOR "Accountable Care Organizations"!

Supreme court ruling won't stop push to control health costs

By Tim Mullaney, USA TODAY

HACKENSACK, N.J. – In 2010, Fred Aueron and his partners looked at the new health care reform law and decided to sell their five-doctor practice.

Medicare reimbursements were dropping, and private-insurance reimbursements were worse. To compete, they needed to be much bigger.

And none of those pressures will change, he says, if the Supreme Court throws out the law when it issues its long-awaited ruling, which could come soon as Monday.

"The small, onesie-twosie practice where you put up your shingle out of medical school is not going to be there any more," the 59-year old Millburn, N.J., cardiologist said. "The strategy was to go to a hospital or a large group. And if the Affordable Care Act (ACA) weren't there, it would be something else."

From Wall Street, the decision's potential impact on health care — and the health care business — looks huge.Barclays Captial analyst Joshua Raskin says some health insurance stocks might drop 30% if the court throws out the entire law.

The ACA would require Americans to buy insurance by 2014 or pay a penalty, subsidize coverage for the working class, expand Medicaid and reform Medicare, and further regulate insurance carriers — all in hopes of covering most of the 50 million Americans without insurance and cutting the 18% of gross domestic product the U.S. spends on health care.

Across the Hudson River in New Jersey, the decision's impact looks much smaller. At Summit Medical Group, which bought Aueron's practice and is the state's largest practice group, and Hackensack University Medical Center, its largest hospital, health care's bruising economics and falling reimbursements are spurring change before most of the act takes effect.

Both institutions provide a similar picture of America's health care future, with or without the ACA. They're big and getting bigger through mergers. They're tightening up management to respond to Medicare's push for cost containment and higher-quality care, which preceded the law.

The reason: Medical inflation, while moderating, continues to outpace general inflation, driving fiscal problems for states and for Washington. At the same time, health care remains a tough business: Bond-rating agency Moody's says non-profit hospitals, which control most of the U.S. market, have their lowest revenue growth in 50 years.

Both institutions are experimenting with new ways of getting paid. Hackensack is a trial site for new federally backed payment models such as Accountable Care Organizations, which bundle payments to encourage preventive care and try to de-emphasize costly tests and hospitalizations. Summit is part of a different federally backed experiment where better prevention and integration has helped a group of New Jersey practices cut emergency-room visits by a quarter and hospital readmissions by 27%, Horizon Blue Cross Blue Shield says. Both are spending millions on electronic medical records systems to avoid mistakes and document quality of care — a must as talks with insurers to get above-market reimbursements get tougher.

"The act made us all talk about it, think about it, and do it," said Ihor Sawczuk, chief medical officer at Hackensack. "But I don't think it will stop. It's the right thing to do."

Building scale to save fees

Jeffrey LeBenger understands the need to make health care cheaper. But he still wants his doctors to get paid.

The Brooklyn-raised ear-nose-and-throat doctor, who has been Summit's chairman for 12 years, knows many health care scholars cheer on networks like Pennsylvania-based Geisinger Health System, believing their use of salaried doctors limits hospitalizations, expensive tests, even excessive end-of-life care. But that's not Summit's business model, and LeBenger's job is to find a way to make his business work in a post-reform world — mending fee-for-service rather than ending it. Summit charges higher fees, yes, but delivers a lower total cost by reducing how much care people need to stay healthy, he says.

"I'll get the patient better, sooner," he said. "Our rates may be higher, but we don't overutilize, and we can prove it."

Running essentially a large corporation built on fee-for-service medicine, the Summit Medical chairman's changes aim to justify Summit's rates by helping patients reduce how much care they need to stay healthy. Since the Affordable Care Act is built to accommodate fee-for-service, a lot of health care's future will reflect his formula: using size and scale as an alternative to moving doctors onto a hospital payroll.

"The Affordable Care Act reflects a lot of what we're doing," Chief Financial Officer Rob Booth said. "Electronic medical records and a multispecialty environment where there is collaboration and quality management because there's enough scale to make the investment."

Make no mistake: Summit is big. When it took over the Berkley Heights campus of Dun & Bradstreet, it had to expand it. It has 1,200 employees and 134,000 patients — aided by acquisitions that brought in 27 doctors since 2010, part of the 81 new docs added in the last five years. In parts of New Jersey, its market share is 40%. It plans more mergers this year to deepen its share in other counties, LeBenger said.

The goal is end-to-end medicine, nearly eliminating out-of-network testing and referrals that cost insurers extra. Summit has doctors in 70 specialties, its own same-day surgery center, even its own urgent-care center, a kind of junior emergency room. Only 6% to 7% of Summit's urgent-care patients are admitted to hospitals, LeBenger said, vs. the 13% to 15% of ER patients the Centers for Disease Control says were admitted in the U.S. in 2008.

Booth claims Summit can deliver 20% lower costs when its doctors provide more than half of a patient's care.

The strategy also demands management and supervision of individual doctors by the firm itself.

Summit has an in-house quality assessment team, whose tasks include reviewing care to make sure hospital stays are kept as short as possible; an electronic medical records system to coordinate care, prevent mistakes that require more treatment and to emphasize generic medications. It even commissioned New York University’s business school to create a medical-economics and management course for SMG doctors The intense focus on studying practice patterns lets Summit sign contracts with insurers that let them gain rewards for saving payers money, said Pegeen Butterfield, a nurse who is Summit's director of care management.

It all costs money small practices don't have, up to 20% of Summit's revenue, Booth says. It's also leading to changes in pay practices: For example, the group now employs hospitalists to monitor patients inside hospitals, and up to a third of their compensation is bonuses tied to quality metrics, tracked by the EMRs, such as average length of stay and how often patients are readmitted.

The benefit patients can see is convenience, says Kara Whitely, a client from Summit, N.J.

Summit doctors delivered Whitely's baby, gave her shots before she traveled to Tanzania to climb Mount Kilimanjaro and, she says, removed her toenail and fixed her stress fracture when she got back. The shared records mean everyone she sees "knows my story." The size of the practice doesn't make it too impersonal, she said.

"If you go to a big university, you still find professors you connect with," she said. "I know the campus and doctors. It's a brand thing, and a trust thing."

There's a harder-headed economic reason, too, Aueron says. The mergers let Summit have enough presence at more hospitals in New Jersey that it gains more leverage on insurers.

Specialization and market share

Robert Garrett says to forget the idea that health care reform will mean lots of money for hospitals. Instead, the chief executive of Hackensack says it has to get smarter — and bigger — with or without the Affordable Care Act.

"If there's an increase in Medicaid, it will be more than paid for by Medicare cuts," Garrett said. The hospital, which gets nearly 40% of its $1.3 billion in annual revenue from Medicare and Medicaid, never took a position on the law, he said.

Like Summit, Hackensack is making deals to grow. Already the biggest employer in an affluent county of 900,000, the hospital, 7 miles west of Manhattan, has taken over the closed 128-bed Pascack Valley Hospital. It has also applied for permission to acquire 365-bed Mountainside Hospital in Montclair and has an alliance with a third hospital for cancer care. Dallas investor Legacy Health Systems will own a majority of Pascack and Mountainside, contributing $90 million to the Pascack deal.

Its strategy is to use Hackensack's national-class capabilities in areas such as cardiology and oncology to lure New Jersey's most complex cases to doctors who handle such patients more often.

"The idea is to export Hackensack quality to the community hospitals, but if there's something very specialized, rather than sending that patient to New York they can come to Hackensack," Garrett said.

One measure the plan is working: The bond-rating agency Moody's raised Hackensack's credit rating last July, saying the non-profit company's combination of mergers, specialized units that are boosting volume, and cost-cutting, including freezing its pension plan, made its already investment-grade debt even stronger.

Quality counts

Another part of Hackensack's plan is becoming a test site for a Medicare cost-containment plan called Accountable Care Organizations.

Launched in April, Hackensack's ACO is an alliance of the hospital and local doctors to emphasize prevention by encouraging early-intervention and disease management plans, and letting providers keep part of the savings. The pilot was authorized by the Affordable Care Act but is similar to earlier Medicare quality initiatives, Sawczuk said.

Hackensack has a toe in the waters of even deeper reforms. About 250 of the 1,600 doctors who practice at the hospital are salaried employees, rather than independent contractors like Summit. And the hospital, along with other New Jersey health systems, owns a small stake in an insurance plan.

Both point toward the possibility of a very different future for the health care business, in which independent doctors become even less important, and there is much more integration between insurance companies and health care providers. That's already common in parts of the country, where integrated plans such as Kaiser Permanente and Utah's Intermountain Healthcare do business.

Movement in those directions will be gradual, hospital executives say. Younger physicians are more likely to adopt the salaried-doctor model than older colleagues, Sawczuk said. For Hackensack, an important question is how rapidly doctors can be asked to change a system that has served them well, he said.

While more radical change may take years, and the court may force trillion-dollar changes in the industry's plans, electronic medical records, mergers and incremental shifts in doctors' financial incentives to emphasize prevention and quality care will go on.

"Medicare is demanding better outcomes and lower costs regardless of what the Supreme Court does," said Bernard Bober, patient representative on the board of Hackensack's Accountable Care Organization. "It's early days. But you can bet they'll know what the outcomes of these changes are, because measurement is a big part of it."

What happens to physician and patients after the Supreme Court strikes down Obamacare!

What Happens If the Supreme Court Strikes Down Obamacare

Scott Galupo is a Washington-based freelance writer writting in U.S. News.

If the chatter in our capital city this week proves accurate, the Supreme Court is poised to strike down the Affordable Care Act in full.

The question on everyone’s mind is, “What then?”

I predict that Congress’s first order of business, before addressing the plight of the uninsured, will be to reinstate, as a stand-alone measure, the section of Obamacare that closes the so-called “Donut Hole” of the Medicare Part D prescription drug program.

The reason is simple. Congress—all of it, not just one party—is over-responsive to the demands of wealthy seniors. If and when they find out they’re going to be adversely affected by the overturning of Obamacare, seniors are going to raise holy hell. And since they were the bloc of voters most resistant to its passage, the appropriate response to the ensuing outcry should be the world’s tiniest violin—but it won’t be.

Another prediction. We’re going to see a sort of strange alchemy in the opinion trends of low-information independents. When they become aware of the fact that Obamacare contained not just spinach but sweets as well, their reaction will be as follows: “But ... but, I didn’t know that was in there!”

Conor Friedorsdorf sums it up nicely at the Atlantic:

Put simply, Americans want all the freedom of a market-based health insurance system, all the security of a system heavily regulated by government, and the option to put off purchasing this guaranteed insurance until it’s needed. And all for no more than they’re paying now. It seems whoever is in power will be doomed to disappoint.

All true—with the ever-thus exception of seniors, who want to continue enjoying the benefits of single-payer insurance (for me and not for thee), and for no more than they’re paying now. They’ll likely get their wish.

Whya re Physicians selling practices to Healthcare Systems?

Seems older physicians do not want the hassle of running a practice in today's environment, and younger physician's are seeking employed opportunities!


Physicians Again are Opting to Sell Practices to Hospitals
SHARON H. FITZGERALD

This is supposed to be a story about practice management. What it is instead is a story about what physicians today, particularly those under 40, think of practice management. The bottom line? Most would prefer not to think about it at all.
That’s one factor driving the growing trend of hospitals and hospital systems purchasing medical practices. “Doctors are tired of trying to be business executives and clinicians, and this provides them the opportunity to turn their practice over and let somebody else run it,” said Kevin Boggs, a senior vice president of PivotHealth, a Brentwood-based contract management company that specializes in bringing practices into the hospital fold and ensuring a smooth transition. Then PivotHealth helps hospitals, on a full-time or interim basis, manage day-to-day office operations such as scheduling, coding, billing and claims. “We focus wholly on the physician-hospital relationship,” Boggs said.

When asked if doctors are more willing today to sell their practice to the local hospital, Boggs responded, “Absolutely, and we’re seeing that nationwide. There’s not one reason; there’s a litany of reasons.” Motivation to sell includes:

• Rising costs, from supplies and salaries to malpractice insurance premiums,
• Declining reimbursements,
• Claim hassles,
• The growing need for continued electronic sophistication,
• The desire for more family time and a more predictable schedule,
• The stress of personnel management and
• Stress in general.

Boggs said practices are operating on razor-thin margins, adding pressure to physicians who don't necessarily have the requisite business skills on top of their clinical expertise. "They want to be a doctor and go home. Particularly physicians coming out of training today, they are willing to let someone else take the risk," he explained.

Wait a minute. Isn’t this sounding like the late 1980s and early 1990s? Look how that turned out. Boggs said this time it’s different. Hospitals have wised up, he said, and aren’t “building doctors taj mahals and then wondering why they are losing their shirts. Hospitals are a lot smarter about this now. They are not going in and buying good will in a practice. They’re not throwing their cash around.”

In fact, today’s hospital-practice deals revolve around the fair market value of the hard assets and perhaps a flat fee per patient chart. “Once they buy that practice, they have no guarantee that that patient is going to stay with that practice and continue to provide a downstream revenue, so they’re not willing to pay for something that they’re not sure they’re getting,” Boggs said. “We’re seeing hospitals that are not awash in cash – they’re having some struggles too because of the poor economy and a higher self-pay population, but they recognize that they have to make sure their physicians stay with them and continue to admit and order ancillary tests.”

With healthcare reform, accountable care organizations – provider partnerships forged to increase efficiency and improve patient care – are in the offing, and hospitals see the advantages of casting a net and pulling in a variety of providers to establish continuity of care and the strongest array of services possible.

But what about physicians in a community who stay independent – a large group practice or a fiercely independent doctor duo? “When we work with hospitals, we try to help them build a model across all the physicians in the community,” Boggs explained. “Hospitals are going to have to work with every physician within that continuum. We work with hospitals to help them run their own practices more efficiently, help them with their billing and operations, but we also help them set up, for lack of a better term, the old MSOs, management service organizations.” In that scenario, hospitals offer independent practices administrative services such as electronic health records and billing and charge them a fair market value. “Ultimately, what happens is that once you develop that relationship and that bridge, when the physician becomes ready to align more closely, you already have that relationship with them,” Boggs said.

Another option for a hospital-practice relationship is for the physicians to hold onto the real estate and the hospital enters into a lease, thus offering the doctor a long-term tenant. “You structure it along the line that you’re not tripping any of the issues with anti-kickback or the Stark regulations,” he said. “You’re just buying the real assets of that practice.”

Last October, the Medical Group Management Association released the results of a survey that revealed that physician compensation and revenue are negatively affected by hospital ownership of a practice. According to the report, the medium total medical revenue for a multispecialty hospital-owned practice was $448,597 per full-time physician, $350,011 lower than in not-hospital-owned groups. Specialty-care physicians in hospital-owned practices earned 19.85 percent less in total compensation than those in not-hospital-owned groups. Primary-care physicians fared better in hospital-owned practices, earning about $12,000 more than independent primary-care doctors.

Boggs said today’s typical arrangement establishes a market-competitive base salary for physicians, usually with a factor added for production. Yet a bonus isn’t based on a patients-through-the-door count. More likely, bonuses are accrued based on relative value units. Again, Boggs added, hospitals are approaching practice purchases more pragmatically this time around.

Physicians and Patients beware!!! Across-the-board Medicare pay cut of 29.5% from taking effect in January

By Charles Fiegl, amednews staff. Posted July 18, 2011.

Medicare proposes a 50% cut for some imaging fees in 2012

Rates would be reduced for interpreting multiple advanced imaging scans performed on a patient during the same visit.

Washington -- As physicians try to stop an across-the-board Medicare pay cut of 29.5% from taking effect in January, the Centers for Medicare & Medicaid Services is proposing additional pay reductions for certain specialists and penalties for those who fail to prescribe electronically next year.

The proposed 2012 physician fee schedule released July 1 paints a gloomy picture for doctors participating in Medicare. CMS is required by statute to implement the across-the-board cut unless Congress steps in to prevent it. But the agency also would expand its multiple procedure payment reduction policy to physicians who interpret the results of certain advanced diagnostic imaging scans.

CMS already reduces what it pays for the technical component of the procedures when multiple scans are provided to the same patient on the same day. Now the agency is proposing to extend the reduction to the professional component, which would affect rates for the doctors interpreting the images. So a physician who interprets more than one MRI or CT scan taken of the same patient during the same visit, for instance, would see a 50% reduction in pay for interpreting the second and any subsequent scans.

The proposal extends a multiple procedure policy that already has been applied to certain surgical and therapy services, and CMS might not stop there. The agency has said that money that is saved by reducing rates for overvalued services helps boost pay for primary care and other services that it considers undervalued.

The latest imaging cut proposal prompted a strong reaction from radiologists. Many CMS pay revisions are first approved by Congress or recommended by a rate review panel convened by the AMA, but not in this case.

Doctors must e-prescribe at least 10 times in the first 6 months of 2012 to avoid a penalty in 2013.

"This is a bold attempt by CMS to reduce physician payments without specific authorizing legislation, and to usurp the function of the AMA Relative Value Update Committee without any supporting evidence," said John A. Patti, MD, chair of the American College of Radiology Board of Chancellors. "If this proposal is allowed to stand, eventually all physicians will be affected, and physicians will not be properly compensated for the work they do."

There are a number of examples of how the pay reductions would go too far, including complex cases where the patient is badly injured, Dr. Patti said. For instance, a physician would receive less pay for doing the same amount of work when interpreting separate CT scans of the head, neck, chest, abdomen and pelvis of a trauma patient.

"There is published evidence to support a payment reduction of 3% to 5%, but there is no evidence to support a reduction of 50%," he said.

Not every specialty that provides imaging services would be affected equally. The services that CMS plans to cut, for instance, are not commonly provided by cardiologists, said Brian Whitman, associate director of regulatory affairs for the American College of Cardiology. However, cardiologists are concerned that the agency will expand the policy to all diagnostic imaging, he said.

CMS does warn in the proposed fee schedule that physicians interpreting multiple x-rays and ultrasounds for the same patient visit may receive reduced payments, possibly starting in 2013. Diagnostic services offered by certain specialties, such as cardiology, also could see payment reductions when the technical component of a test is billed at the same time as another service.

The CMS proposal on imaging mirrors some of the advice of the Medicare Payment Advisory Commission. The AMA has disagreed with that approach and suggested the policy would compromise care.

A 29.5% Medicare pay cut for physicians is scheduled for January 2012.

The AMA is reviewing the 621-page proposed fee schedule, said AMA President Peter W. Carmel, MD. But statutory payment policy outlined in the rule shows Congress must act to fix a flawed pay system, he said.

"Many physicians are already struggling with inadequate Medicare payment rates and the ongoing threat of future cuts from the broken Medicare physician payment system," Dr. Carmel said.

The Association has recommended that CMS use its regulatory authority to review and revise the Medicare Economic Index used to calculate physician practice expenses. Revisions to the MEI could reduce the cost to Congress of a permanent replacement to the Medicare payment formula, Dr. Carmel said.

In the proposed fee schedule, CMS said it would apply a similar approach used this year to implement Medicare electronic prescribing penalties in future years, meaning doctors must e-prescribe in 2012 to avoid a 1.5% penalty in 2013.

An eligible professional would need to report at least 10 e-prescribing transactions during the first six months of next year to avoid the penalty. However, CMS would allow physicians to report e-prescribing activity during any patient encounter in 2012. Current program policy limits eligible e-prescribing encounters to certain services, such as office visits.

Physicians who earn bonuses for e-prescribing this year would not be subject to the 2013 penalty. Doctors who earn bonuses for e-prescribing in 2012 also would not be penalized in 2014, when the pay cut rises to 2%.

More and more physicians are not accepting new Medicaid and Medicare patients (Can't afford it)!

More Doctors report they cannot afford to take new Medicaid and Medicare Patients!

By Caroline May - reporter for The Daily Caller.

H/T Daily Caller

Thirty-six percent of doctors say they are no longer accepting new Medicaid patients due in large part to declining reimbursements, a new national survey has found.

The survey of 2,232 physicians across all specialties conducted in late April by Jackson Healthcare in Atlanta — the fourth-largest health care staffing company in the U.S. — further found that broken down for specialty, 66 percent of dermatologists, 64 percent of endocrinologists, 58 percent of internists, 57 percent of physical medicine and rehabilitation doctors and 53 of adult psychiatrists said they are no longer able to take on more Medicaid patients.

Other specialties in the survey with a high percentage of doctors who reported stopping accepting Medicaid patients include orthopedic surgeons (50 percent), family practitioners (45 percent), gastroenterologists (47 percent), neurologists (43 percent), cardiologists (39 percent) and urologists (35 percent).

Currently 26 percent of physicians see no Medicaid patients at all, the survey reported.

According to the Kaiser Commission on Medicaid and the Uninsured, under the Patient Protection and Affordable Care Act (the constitutionality of which is currently under consideration at the Supreme Court), Medicaid enrollment could increase by 22.8 million by 2019.

According to Richard L. Jackson, chairman and CEO of Jackson Healthcare, the low reimbursement rate paired with the large influx of new Medicaid patients will be a problem.

“This is creating the perfect storm that will make it very difficult for the poor and elderly to access a doctor,” Jackson said. “Physicians say they just can’t afford to be part of a system that generates so many patients for so little compensation.”

The survey further noted that 17 percent of physicians said they could no longer afford to see new Medicare patients and 10 percent reported not seeing Medicare patients at all.

Obama care is sickening patients, and making physicians poor!

H/T Town Hall

Physicians agree Obamacare is bad for the practice of medicine, and will shut down non-health system owned practices. Obamacare means bye-bye private practice, and hello employed practices. When Obamacare is struck down look for physician salaries and working conditions to increase!

Obamacare and The Supreme Court – the Clinical Perspective

Once again, everyone is talking about healthcare, largely thanks to the historic events which took place in the Supreme Court last week. The public has been showered with speculation about what will happen if the mandate is struck down, or if the entire law is overturned or if the law remains intact. Although this is a quintessential legal affair, it is curious that once again, those most closely enmeshed in the trappings of this conundrum- the physicians who deliver healthcare- don’t seem to have a voice, so as if to imply that they are insignificant bystanders.

Most physicians now agree that Obamacare will not help them care for patients any better than before its passage and will instead harm them. The architects of this law brilliantly front loaded it with “goodies” that make it popular with many Americans. Keeping “kids” on your health insurance until they are 26 or preventing insurance companies from dropping patients with pre-existing conditions can make people forget that the cost of a family health insurance policy has risen on average by $2100, not dropping $2500 as promised by President Obama. The promise of “free preventive health screenings” should concern everyone, because unfortunately, Americans will once again learn that there is no such thing as “free”. There is a cost attached to everything, especially healthcare.

Most doctors might think it reasonable if everyone had healthcare insurance, but that is not what Obamacare is about. The essence of this law is that every American must purchase a health insurance policy that the Federal government approves of. That means that the government defines what is in the policy, what will be covered and what will not, and who will be allowed to deliver that care and under what circumstances.

The legal argument that has become the foundation for the defense of the individual mandate is that there is cost shifting, which is created when uninsured individuals show up in the emergency room for care. The contention is that we all pay for this, and that universal coverage will put an end to this problem.

The irony is that Obamacare itself is an elaborate cost shifting scheme. It shifts $500B out of Medicare to pay for the 159 new federal bureaucracies that have been created under this law. The 80 million people who are going to be put on Medicaid will shift costs to the 50% of Americans who still pay taxes and will absorb the healthcare costs of those who pay nothing. Obamacare is an income redistribution scheme.

The tenor of the proceedings in the Supreme Court last week creates hope amongst physicians that Obamacare will be overturned. Anything short of that will fail to halt the events currently underway that are eroding the foundations of the medical profession. Built into Obamacare is reduced compensation for physicians, increased regulation, unrealistic demands, and no relief from medical liability abuse.

All actions always have consequences- whether intended or unintended. The result of Obamacare will be less doctors working, which means that the guarantee of increased access to healthcare is a false promise. Your insurance card will only provide a place in line. It means that the Patient Centered Outcomes Research Institute will decide what treatment you will get. It means that the Secretary of Health and Human Services will tell your doctor how to practice medicine.

On this current path, the private practice of healthcare will disappear within the next 10 years, as physicians sell their practices to hospitals, afraid that they can no longer afford to stay in business. More than 50% of doctors now work for hospitals. Obamacare suspends antitrust regulations so that hospitals can consolidate doctors’ practices into a single entity- an accountable care organization (ACO). Under such an arrangement, the doctors work for the ACO and not for the patients.

There already are rumblings coming from Washington suggesting that physician licensure needs to be nationalized in an attempt to compel doctors to see patients on Medicare and Medicaid and avert the mass exodus that is expected when reimbursement rates are slashed in the coming years.

Most doctors still believe that there is some hope for them and for their patients. This would require a Republican President, Senate and House of Representatives, and a repeal of Obamacare. The prospect of a helping hand from the Supreme Court is something that was not counted upon, but which would be most welcome.

Dr. Hal Scherz is the founder and president of Docs4PatientCare and organization of physicians dedicated to protecting the doctor patient relationship

Physicians for Healthcare Savings Accounts! Physicians should embrace Health Savings Accounts!

Health savings accounts should replace Obamacare, and let the market replace the today’s system. Good physicians could charge more, and not so good Doctor’s would have to ask for less. The free market makes the cream rise to the top in both results, and charges. Physicians would like the system because collections would rise to near 100% (if you exclude Medicare and Medicaid), and that’s a good thing!

  

AMA Offers Health Savings Accounts for Physicians

From the Louisiana Medical News

By: BY SHARON H. FITZGERALD

The American Medical Association (AMA) is helping physicians take advantage of the savings and flexibility of health savings accounts (HSAs).

The newest offering from the AMA Insurance Agency is an alternative to traditional health insurance for both personal and practice health protection needs.

"The AMA, largely through its advocacy efforts, was a major player in getting HSAs their legs in January 2004. Then, when HSAs actually became a viable product, since the AMA is such an advocate of patient choice in healthcare, we thought, 'Why wouldn't we want to do that for physicians, since it's good for everybody?' " Christopher Burke, president of AMA Insurance Agency, recalled. The agency is an AMA wholly-owned subsidiary, founded in 1988 with a portfolio that has grown dramatically through the years. Today, the agency partners with approved major carriers to offer physicians disability, long-term care, Medicare supplements, a Medicare-approved prescription drug plan and a host of other health offerings, plus insurance in other categories such as life insurance and property and casualty.

For the new HSA coverage, the AMA agency partners with First HorizonSM Msaver, Inc. Msaver has had a long history of offering medical savings accounts (MSAs), the first generation of such tax-saving accounts for healthcare. When First Horizon acquired Msaver in 2005, it brought to the table "the savings component and the technology platform that the bank provides to make it easy for people to deposit into the account, get the account set up, take money out to pay for qualified expenses and track those expenses," Burke explained. "The banking experience, I think, is really what's making this much more viable for people today." He explained that the AMA agency's role to provide physicians with "a little bit more of a concierge service," while taking advantage of First Horizon Msavers' expertise in the HSA field.

HSAs were created in Medicare legislation signed into law by President Bush on Dec. 8, 2003. They took effect in January 2004, replacing MSAs with a program offering additional tax advantages.

"When the tax code changed, the government really began to embrace HSAs as a way to self-direct healthcare choices, and they wanted to provide tax incentives for people to begin experimenting with this as a concept," Burke said.

To launch an HSA, the insured must already be covered by a high-deductible health plan which insures against catastrophe. First Horizon Insurance Services, an affiliate of First Horizon Msaver, offers the high-deductible health plans from several highly rated insurance companies.

Contributions into the tax-deferred HSA account are used to pay qualified medical expenses, and the HSA takes the form of a tax-exempt trust or custodial account for tax purposes. What's interesting is that some qualified expenses of an HSA — all tax-free — are not typically covered by traditional health insurance plans, such as dental, vision, orthodontics, prescription drugs and long-term care. Unused funds in an HSA can roll over from year to year, earning interest on a tax-free basis.

Both individuals and employers may set up and fund an HSA, and contributions can be made on a pretax or tax-deductible basis. HSAs offer flexibility and portability because even if the employer also contributes to an individual's HSA, the employee owns the account and can take it with him or her should employment cease. HSAs can be for one person or for families.

Burke said he believes HSAs offer particular advantages to physicians, their families, their associates and employees, and their practices' bottom lines. "Physicians are already dealing with this fabric of healthcare. Physicians obviously are providing quality, cost-effective care to themselves and their families and very often to their practice associates and their families," he said, surmising that routine healthcare within a practice is handled very cost-effectively.

"Why wouldn't you want to tailor your medical insurance program to that care experience? So you've got a program permitting people to save money on a tax advantage by creating a savings account for routine care, and if they don't spend it, it remains in there as a tax-deferred benefit that they can spend in future years or just save," he said. "Then you've got the high-deductible health plan that is there for any serious, unforeseen, major medical problem that protects you from personal bankruptcy, so it's an interesting combination."

Burke said the AMA Insurance Agency is starting to see more physicians offer HSAs as an employee benefit option while also offering a traditional health plan.

"An HSA may not be for everybody. It's a new concept, so it tends to be a little scary for some folks who are very used to traditional base plans. You don't want to force your associates into it, but you may be able to ease them into it via this sort of a combination plan," he explained.

About 150 HSA policies were written by the AMA agency in the last few months of 2006, "but we have not yet taken the huge step into the group practice environment," Burke said.

"We just began this fall to pilot a few programs to do that," he said. "We've seen some concepts that we've put out there begin to work. Typically within the group practice, it's going to be a matter of connecting with an insurance agent who's already working with that group practice and talking with that individual, because they trust that person for their health insurance needs. It's pretty difficult for us sitting here in Chicago to coach physician practices, especially with their group practice managers, unless you're face to face. So we began to experiment with some in-the-field experience this fall, and we'll see where that goes. But I think it's a really, very interesting program for practices, especially as they're being squeezed with their financials."

The first step, Burke said, is acquiring the high-deductible health plan, which then makes the physicians eligible for the HSA.

"I think doctors are starting to embrace it more as a concept for them and their practices as its really taken root and become a viable product on these banking platforms," he said.