Oct 16, 2009

Dueling doctors

Lansing is the site of many protests, rallies and demonstrations as constituents and advocacy groups attempt to lobby and influence lawmakers.

The budget process has spurred plenty of rallies, like the one held on Sept. 24 when doctors and human service advocates descended on Lansing to protest the Department of Community Health budget that cut the reimbursement rate to health care providers for Medicaid by 8 percent. The rate paid to doctors and hospitals that treat poor and low-income patients has been an easy target of cuts, and those providing the care are losing money to the point that they don’t want to see Medicaid patients.

Subscription only Gongwer covered the rally, and doctors, like emergency room doctor James Fox, said the 8 percent cut could crush the state’s health care system and force doctors out of practice and put ERs in jeopardy.

"Another cut to Medicaid would cause a death spiral where people will wait to get care and end up at the hospital where costs for treatment are even higher," Dr. Fox told Gongwer.

Patrick Wardell, CEO of Hurley Medical Center in Flint, told Gongwer that the 8 percent cut would result in a projected loss of about $8 million and potentially a reduction in the quality of critical care such as burn treatment, neonatal care and other specialty areas that 23 surrounding counties depend on the hospital to deliver.

“The hospital can't sustain these cuts without compromising care," said Wardell said, adding that staff would probably be one of the first areas they would trim, since it accounts for up to 75 percent of the facilities' expenses.

So on Oct. 6 the House addressed those concerns and passed House Bill 5386 that enacts the physician Quality Assurance Assessment Program (QAAP) that imposes a 3 percent gross revenues tax on physicians. Revenue collected from doctors would be matched with Federal funds bringing in $2.70 for every $1 the QAAP raises. Using these matching funds, the state would then significantly increase Medicaid reimbursement to doctors, bringing them up to Medicare standards.

Guess what? Doctors - primarily private practice doctors - are against this, and they are predicting the sky will fall if this becomes law, even though doctors who treat Medicaid patients will see significant increases in income.

In fact, the Michigan State Medical Society is sponsoring a rally of its own in Lansing on Tuesday, calling it the “White Coat Rally.” It will coincide with the first Senate committee hearing on the bill, set for 1 p.m. Tuesday Oct. 20 in front the Community Health Appropriations Subcommittee in the Senate Hearing Room on the ground floor of the Boji Tower.

The group is making dubious claims that it will push doctors out of Michigan, and asking if other professions would be willing to accept a 3 percent tax on their income. To me, the answer is yes, if I get a 3-6 percent pay raise like they will.

The result is that many providers will not only break even on the tax, they will actually earn more money from the increased reimbursements than they pay out in the tax. And the state has a track record that this works.

This is not a new idea. It is designed to mirror successful programs with hospitals and nursing homes that the state has run for several years. The concept is to assess a category of Medicaid provider, pool the revenue, match that pool with Federal Medicaid funds to create a pool 3-4 times larger, and then redistribute most of that pool back to providers in the form of higher Medicaid reimbursement rates.

The increase in the Medicaid reimbursement rate would bring doctors up to the standard Medicare rates. Doctors with a higher percentage of Medicaid patients will make more money.

The plan will encourage physicians to accept more or begin accepting Medicaid patients. This will increase access to care for our poorest citizens and should in time reduce our overall expenditures on health care due to increased primary care visits and decreased emergency room visits.

Not only will it increase income for many physicians, it will also provide an opportunity for the state to continue other vital public health programs. On top of restoring that cut and increasing reimbursements to Medicare levels, we could also restore some spending for mental health services, prevention programs, substance abuse, local public health offices and other vital programs through the Department of Community Health budget.

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