Monday, September 23, 2013

State Medical Societies: Obamacare's Early Warning System

A canary for the health care reform mine
The Disease Management Care Blog has a theory.

Whatever you think of health care reform, there is a possibility that its implementation could be troubled for years to come.  Too few healthy young people could sign up, provoking an upward insurance cost spiral.  Bureaucratic meddling could further increase administrative burdens. Washington DC's political and fiscal woes could erode fee schedules.  Large regional delivery systems, saddled by inefficient capital, workforce salary inflation and overly optimistic risk contracting could become stressed.  The medical-industrial complex's bubble won't necessarily burst, but increased demand and less money could mean a painful contraction.

What will be the first signal that that's happening?

It won't be the pronouncements from the intelligentsia running HHS. It won't be a late Friday press release from the White House. It won't be a breaking news report from the clueless reporters in any of the major media outlets.  And, unfortunately, it won't be in a prescient posting by the DMCB.

It'll be an uptick in physician membership in 50 state medical societies, followed by phone calls their affiliated professional liability insurance brokers.

The DMCB is talking about the state organizations that largely make up the base of the American Medical Association (AMA).  After seeing many of these organizations up close, the DMCB can assure readers that that is where the resemblance ends. Being much closer to the ground level of clinical practice, these entities are acutely aware of the decline in private practice. Many have watched their membership - and their income - go down as the result of docs joining salaried settings where membership dues are a cost and meetings are time away from patient care. As a result of their hunger for business, the state societies have responded in part by making their suite of member services more turn-key and easy to use than ever before.  They have to do that to hold onto their current membership.   

Fast forward the possible bleak future described above. The most expensive part of a hospital system's work force will no longer look quite so affordable.  Some physicians will have their contracts euphemistically non-renewed, while others will be beat up by less "fixed" and more "performance-based" variable salary arrangements.  Since its reasonable to assume that the health reform's malaise will be nationwide, it's unlikely that these disgruntled docs will be able to simply pull up stakes and get hired in some other comfortably suburban setting in the next county or next state.

They'll think about private practice.

They'll wonder if they can start their own businesses, negotiate their own insurance contracts and do so with less overhead and without being told what to do by clueless administrators.  They'll be wondering about finding a practice manager who knows about coding and billing. They'll think about about cutting out the insurer middleman with a cash-only option. They'll think about dropping of out Medicare. And they'll realize that they will probably need to buy "malpractice" insurance and want a quote.

There are many good companies that offer support services to physician-owned practices. They'll get phone calls too, but not like the state organizations. They'll be the first to know.

They'll be the canary in the mine.

And in case you think the DMCB is being a pessimistic weenie, consider this anecdote: decades ago, physician staff unhappiness with one health system's managed care contracting led a renegade group of docs to call a state medical society for help.  The society obliged and participated in a series of after-hours presentations on physician practice that was attended by almost a third of the staff physicians. The young physician DMCB was in the back of that room.

If the DMCB was in the Obama White House, it would advise that it assign one of its health policy interns to regularly call the execs of a number of state medical societies.  If they describe sharp upticks in membership, that'll be cause for concern.

Image from Wikipedia


GlassHospital said...

I really like your prediction. While you label it as the "Early Warning System," I think a more accurate (and grim) title would be something akin to "The coming hospitalist apocalypse."

That may be too hyperbolic, but you're on the money as far as the gravy train not lasting forever vis-a-vis perpetual interns with cushy schedules and no take home responsibility. Only a matter of a couple of more years until the market is finally saturated and hospitals realize they can cut the top heavy portion (for the reasons you mention) and replace it with the newly minted.

GlassHospital said...

ps. would be fun to have more narrative about the story of the DMCB in the back of the room. did the PA med society help quell the rebellion?

Jaan Sidorov said...

The PA House of Delegates meets this month......