Sunday, February 16, 2014

You Are the Hunted: Eat What You Kill Versus the Salary Model (Let Others Do the Killing, My Eats Are Free)

"It's hard to get a man to understand something when his salary depends upon his not understanding it."  - Upton Sinclair

This week, a popular NYT article describes how physicians are flocking to salaried positions in hospitals and healthcare systems in order to preserve their incomes amid reimbursement cuts, and to protect themselves against the vagaries and uncertainties of the healthcare landscape in the age of Obamacare.  For those not used to thinking about physician remuneration, I will give a brief synopsis.  There are basically two models of physician earning, and hybrids of the two.

The "Eat What You Kill" Model
Yes, this is the colloquialism commonly used to describe physician reimbursement in a pure private practice model.  An analogy to hunting for survival, you get to bill for, and keep the collections from, patient encounters that you pursue.  The harder and the more often you hunt, the greater your bounty.  Here are the problems with this model:

  • "Poaching" (Hunting out of season, or hunting things which are illegal to hunt):  Unscrupulous physicians (and they're more common than you might imagine) are motivated to do things that are remunerative for them but not in patients' best interest.  Examples that come to mind are:
    • Unnecessary reflex testing such as yearly echocardiograms in stable heart failure patients, PFTs in COPD patients, or colonoscopies in elderly patients
    • Unnecessary procedures such as hearth catheterizations, coronary stenting, knee arthroscopies, bronchoscopies;  note that invasive procedures, which may be quite risky for patients, often pay the most for a given amount of "hunting" time invested by the physician, so they are most likely to be abused.
  • Multiconsultism, or "Forming a Hunting Party":  This is the model at many private practice hospitals that become veritable billing mills.  It has elsewhere been derided and called "multiconsultism".  I personally find it to be particularly abhorrent and loathsome.  Multiconsultism is like forming a hunting party.  The hospitalist or intensivist admits a patient with one primary problem, but also minor disturbances in various body or organ systems.  S/he then consults every specialist to handle every minor perturbation: renal, cardiology, endocrine, pulmonary, Infectious Diseases.  (Oh, never forget to consult ID.  They will repeat the H&P for you and make sure you didn't miss anything.  What else can they do for you?)  Each specialist then bills the patient individually (often leading to the proverbial hospital bill that grandma received with 15 physicians billing and 12 of whose names she did not recognize).  This has several beneficial effects for the hospitalist - now s/he can see more patients in a day and spend less time because s/he has subcontracted out the job to various subcontractors.  S/he bills the same amount, and all the specialists get to bill too.  It's a free-for-all.  But the patient suffers both in terms of an inflated bill and because of the fragmented and redundant care that results when six physicians are seeing and writing orders for a patient.  Other authors have described the "Bystander Effect" whereby all the physicians assume that another physician is going to take responsibility for some problem - but since they all think that, not one of them does.
  • "Hunting in the Desert": It is difficult or impossible to get physicians to work in underserved areas where large proportions of patients are uninsured or "self-pay" (which basically means "no-pay" to the physician) or have certain kinds of Medicaid.  In these desert settings, you spend a lot of time hunting stuff that you can't kill or can't eat.
I won't get into the underlying issues related to how such a situation may come into existence.  I am here more concerned with simply describing the situation as it is.

The second major model, that described in the NYT article, is the salary model.  In its most basic form, a physician receives a fixed salary for providing the necessary coverage for his or her specialty in a contractual agreement with an employer, usually a hospital or healthcare system.  There are some benefits of this model:
  • Poaching decreases.  Under a salaried model, physicians are motivated only to do what is medically necessary for the care of the patient.  The salaried position becomes a clarion call to economy and efficiency - for now the physician does not want to do extra services because s/he will not get more compensation and extra services create gratuitous work for the physician.
  • Physicians will hunt in the desert, if you pay them to.  If you're salaried, you don't care whether the patient has insurance, or what kind it is.
But there are problems:
  • When your meals are guaranteed, you're not hungry.  And when physicians are salaried, nobody wants to hunt.  When the ER calls you to admit a patient, your instinct may be to deflect to another provider.  The ER calls the hospitalist, s/he says, "the patient is too sick for the floor, call the intensivist."  The ER calls the intensivist, s/he replies "that patient is not critical, he can go to the floor."  The only thing that holds the system together is a sense of duty to one's responsibilities as a physician, and cooperation among physicians.  In my cynical opinion, both of these are vanishing faster than the polar ice caps.
  • When physicians are salaried, you can't form a hunting party if you want to.   When the primary admitting services (hospitalists or others) take responsibility for the patient, all other services become elective or discretionary.  Specialist consultants do their respective specialist procedures, but getting them to do a consult or follow up on a patient is like pulling teeth.  They deflect to curb-side consultations or other obfuscations.  (Curb-side is when you ask a consultant a question in the hallway, rather than request that they actually go see the patient and do a formal written consult in the medical record.)
  • Specialists have a strong incentive to shrink away from admitting any patients under their care as the primary admitting physician.  It's too much work compared to a consult, or a curb-side, or obfuscations.  In addition to the usual (and tired) arguments over whether the primary problem falls under the rubric of their specialty, enter the pretenses relating to the patient "having too much other stuff going on".  So now you have a patient, with, say, a primary cardiac problem, but the cardiologist won't admit him because he has diabetes and mild chronic kidney disease.  So the hospitalist admits the patient, and has to wage a small war to get the cardiologist to see the patient, because nobody wants to go hunting when his eats are free.
In a common hybrid between the two models, physicians are salaried but have some component of incentive pay which is based on RVUs (Relative Value Units - a metric for determining how much a medical service should be compensated.  Procedural billing codes often have higher RVUs and therefore are more lucrative billing codes for physicians and their employers.)  This has the effect of funneling physician efforts into these high RVU activities such as procedures, which resurrects one of the demons of the "Eat What You Kill" Model.  It also exacerbates the difficulty of getting specialists to see patients outside of the procedural suite (e.g., admit them or do a formal consult on them) because these low value activities erode away at the time to do the high value procedural activities.

But hospitals have a strong incentive to keep physicians doing procedures.  Procedures are more remunerative, and the hospital/employer collects the physician's billing and uses it to defray the costs of his employment.  Moreover, the hospital charges facility fees for every procedure that is done.  Procedures are a win/win for a hospital.  They probably are not for a patient, unless the patient really needs the procedure.  But in the Eat What You Kill model, or the Hybrid model, how can a patient know if they really need the procedure?

One thing is for sure:  this rush to employ physicians is either going to redistribute profits to hospitals employing physicians or hold stable or increase healthcare costs - that's the implicit bet.  And if it does happen to reduce profits/costs, I know a lot of physicians who are going to be out of a salaried job in a couple of years.

1 comment:

  1. Fantastic article; loved the analogies!


Note: Only a member of this blog may post a comment.