On selling-out the physician patient relationship.

Some doctors are selling out the physician patient relationship to the highest bidder. That is a strong statement, but it is sadly true. To understand what it means to sell-out, you first have to know how it is that doctors get paid. This is very complex, and I will try to make it as simple as possible, but believe me when I say that the rules by which doctors get paid for what they do, are of a complexity that would make the I.R.S blush. It doesn't have to be that way, and it wasn't the doctors themselves that dreamed this up, but it has evolved over the years into the monster that it is, again, much like the I.R.S..

Most doctors get paid according to a set of rules known as C.P.T. coding. Almost everything that gets done in medicine has a code for the service provided. This "payment code," or "billing code" as it is more commonly known, is then generally linked to the patient by a Diagnosis Code, also known as an I.C.D. 9 code. That way, if a patient has the diagnosis of "appendicitis," it matches with the billing code submitted by the surgeon for "appendectomy."

There are vast books of diagnosis codes, and even larger more complex books filled with billing codes. How they apply in each and every conceivable patient care situation, creates almost limitless possibilities. Every type of provider you can think of, has their various codes for what they do. Every type of facility for providing services to patients has its billing codes as well. Are you starting to see what I mean when I say it is extremely complex? Doctors take classes frequently, just to keep up on the changes that occur most every year when a big group of government officials gets together and decides how much each service will be paid. Then it all gets posted in an official book called the "Federal Register."

Doctors don't bill in actual dollars when they perform a service. For billing purposes, everything we do has a "unit value." The units are referred to as "Physician Work Units." So for example, if you see your regular doctor for a typical 15 minute visit, he will submit a billing form with your diagnosis for that visit, and a billing code for what he did. This type of service is the most frequently rendered around the country, day in and day out, and is called an Evaluation and Management service. This particular example would render that doctor about "One Physician Work Unit." If he also performed a procedure, he would submit a code for that procedure in addition. An example would be a visit to the doctor to have your blood pressure checked, and a mole on your arm looked strange, so the doctor decides to do a skin biopsy at the same time.

Now how many work units are allowed for various procedures and visits, is extremely controversial and is a constantly undergoing revision as I had indicated. What is truly amazing is that the system works fairly well, for the most part. In general, the work units allowed for the various services rendered, are probably about as fair as it can be, given the politics of the Federal Government and the representatives of the various specialties. Many different variables are considered when assigning values to procedures. Some of these variables include the time it would be expected to take to do the procedure, the degree of extra specialty training required to do the procedure, the amount of post operative care that will be required of the doctor after the procedure which is generally included in the "surgical package," and the risk of malpractice that goes along with performing such a procedure. That is why a skin biopsy done in the office may render one work unit, and the removal of a brain tumor in the hospital, might be worth 40 work units.

Right about now, you are probably wondering, "what is a work unit worth in actual dollars?" That is a very good question. I will tell you that when a physician submits a bill, he actually gets paid according to a more comprehensive type of unit, called a R.V.U. or "relative value unit." This type of unit is actually a combination of the physician work units, the cost of facilities, and the cost of malpractice. If you look at any code in the Federal Register, it will give you the breakdown of each of the three components for that code, as a percentage of the total reimbursement allowed.

So again you ask, what does my doctor get paid for that 15 minute office visit? The answer is, "it depends". It depends on who is paying. Welfare/Medicaid pays about $28. Medicare pays about $37. Commercial insurers pay all over the map, but 150% to 200% of the Medicare rate is typical. These estimates are going to be very close, but not exact, because where you practice can affect reimbursement to some degree. Medicare doesn't vary much at all. That $37 give or take a buck, is going to be it, no matter where you practice. Welfare/Medicaid can vary widely depending on the state, and commercial insurance like most of us have, can pay all over the map, depending on how they can or cannot leverage doctors in that specific market. Lastly, let's not forget that most doctors get paid nothing for about 5% of the patients they see. So if you added up all of the R.V.U.'s, and all of the money collected, my guess is that it would probably be about $60 per R.V.U. on average,

Most doctors, by definition, are going to produce work units at around the median for their specialty. Surgeons and procedurally based specialists will produce more work units over the course of a year, than doctors who don't do a lot of procedures. Looking at the work unit data on thousands of doctors, all over the country in all of the various specialties, has found this to be true. So if you look at these doctors in their various specialties, and you take the median producers in each, you can get a data set that describes about how much that doctor will make, based on specialty. These data are widely available, but are generally proprietary in nature. One of the better data sets is called M.G.M.A., or Medical Group Management Association. There are others as well. And when you distill it all down, you can generally say that non-surgeon/non-procedure doctors are going to make about $150 to $200K, plus benefits, after expenses but before taxes, functioning at the median. The surgeons are going to do about $75 to $100K more. Surgeons train longer, by 2 years or more on average, and they work about 10 hours per week more on average, and they take more intense and more frequent after hours call, on average. That is why they produce proportionally more work units than non-surgeons. A very simple way to add it up, is to say that non-specialitst doctors make about $100 per hour, and specialist doctors make about $150 per hour.  To both I would add about $20-$25 per hour in benefits.

So now you have a great insight into the financial world of doctors, complex as it may be. But you already know that they go to school and training for a ridiculously long time and take on all of that student loan debt, they work very hard long hours, and they make a lot of money. Sounds a lot like any other successful small business owner doesn't it? You are right. So what is the fuss all about?

The healthcare industry is gigantic, and growing by leaps and bounds. What we pay doctors on a per visit basis, is only a tiny fraction of that, and shrinking. So why do we even care? The reason all of those corporate types need to control doctors is because over 90% of healthcare spending that goes on in this country, some $2+ trillion, must be authorized by the signature of a physician!

Wow! That's it! It's not the doctors that matter to insurers and hospitals, it's that all of those trillions of dollars flow through a very narrow gate, and that very narrow gate is the pen of your doctor. Imagine the frustration of your Insurance or Hospital (or both) CEO. This gigantic medical industrial behemoth burning up trillions of dollars a year, lying there before him, and he can't touch it, or make it perform to his advantage, without the consent of the lowly doctor, that now is his employee, and makes a fraction of his cushy income. The frustration is epic. Is it any wonder he will stop at nothing to own your doctor, to make him do what needs to be done to make his bottom line fatter? Maybe even stoop to bribery?

This is where the doctor prostitute comes in. Now I don't say this lightly, and so far this is a small percentage of doctors, but it's starting to become more common. The doctor prostitute usually is a specialist that accounts for many expensive inpatient procedures, surgeries and tests. A good example is a cardio-thoracic surgeon, or cardiologist that does a lot of stents and angiograms. Now if you look at his personal productivity, compared with national benchmarks, you might see that this guy might make a salary at the very high end of specialists, like $400 to $500K, particularly if his productivity is well above the median. This is OK in my book. He is probably killing himself, and destroying his family and social life to do it, and if that is his choice, then so be it.

Now let's say there is a hospital that really wants a piece of the cardiac surgery, or cardiology business. Why you might say? Because that same doctor killing himself to make that high salary, is probably bringing $8-$10 million to the hospital that hosts his business. These estimates are probably low if anything, I assure you. So now you have that Hospital CEO desperate for this great line of business, in need of that doctor to make it happen. So how does he lure that doctor away from his current position? Well he just adds up the numbers, and figures out that if he slides $200 or $300K out of the hospital side, into that doctors pocket, he will more than make it up in the end.

Now the doctor is looking at doubling his salary for the same work. It would seem like an OK thing to do, no ethical dilemma here right? Wrong! It completely distorts the market. It creates a whole subset of doctors that don't get paid for what they do for their patients. They get paid partly from what they do for their patients, and partly from a direct kick-back in their salary from the corporation. And don't be fooled by the Hospitals and Insurers that call themselves "Not for Profit." Who are you kidding! As far as the public is concerned, the only difference between "For Profit" and "Not for Profit" corporations, is that the "For Profit" corporations actually pay taxes, and that helps us all. But that is a major topic for another day.

Now you might ask, why isn't it illegal for corporations to give Kick-Backs like this to doctors? Well it is, but there are lots of ways they can hide it. They don't just put it as a line item on that doctor's W-2 form at the end of the year "Kick-Back." No, they have to be very clever. One of the more clever ways for them to do it, is to cover all of that doctor's overhead, and hire him lots of expensive help to do all of the clean-up work after the surgeries. That frees up the surgeon to stay in the operating room, and on the assembly line, so to speak, which can make him super productive. Then when you look at his productivity, and it is now maybe at the 90th percentile, and not just the median, it looks like he just earned all of that extra money. In fact, it is just a scam. He didn't earn it at all, and it's really his patients that are getting short-changed.

Now why is it that his patients are getting short-changed you might say? Well when a doctor does a surgery, the Federal Guidelines actually spell out how much he gets paid for the various pieces of that surgery. A major surgery has what is called a "Global Period" for 90 days afterward. During that Global Period, the surgeon cannot charge for hospital rounds and follow-up visits in the office, and various other issues that come up after major surgery, as you can imagine. A big piece of the surgical package fee, is for the post-operative follow-up. Usually about 30% or more. The problem is, he isn't doing your follow-up. That's inefficient. His assistants of all sorts, are doing the work for him. Now who do you really want checking on you closely after bypass surgery, the assistant or the doctor? At most of these major heart centers, you may never see the surgeon, except as he sweeps by with his entourage in a minute flat. But you paid for his post-operative attention, not some assistant.

Doctors should get paid for what they do. They don't have to do it all, but what they do should at least reflect the guidelines. If 30% of the fee is for postop follow-up, then the effort should reflect that, on the part of the surgeon. If it is going to be done by others, that can be fine too, but the doctor should not get the entire 100%. He should get 70%, and the rest should go to the overhead of employing all of those assistants. I've seen arrangements where a hospital will provide so much support to the doctor that if he had covered that overhead for himself, he would have been bankrupt! Instead, with all that expensive help, he was able to ramp up his productivity so high, the salary was more than double what a typical doctor in the same specialty could command. All of this is just a big kick-back that is very hard to trace, and in the end, it is the Hospital or other big entity that winds-up raking in the dough, along with the over-paid doctor. As a physician and surgeon, I find the latter to be a particular affront, and I never miss an opportunity express my displeasure to any doctor whom I know has sold-out. I consider this completely unprofessional, their technical skills notwithstanding.

Now don't get me wrong. I used heart surgeons as an example, but there are plenty of other ways this goes on. Oncologists getting kick-backs on the administration of expensive chemotherapy drugs. Kidney specialists getting kick-backs on dialysis centers. Gastroenterologists getting kick-backs on endoscopy centers. The list goes on and on.

So how do we fix this? I will tell you how. The cost of ALL overhead, needs to come out of the revenue brought in by the doctor. The reimbursement is already set-up that way but is being perverted. It is the greed of some doctors to get paid excessively for what they do, and the clever accounting of the supporting hospitals that has distorted all of this, and it needs to stop! Doctors get paid well enough to do what they do, the way it was meant to be done. The damage comes when doctors allow themselves to be owned and controlled by corporations.