Tuesday, February 2, 2010

Within Health Reform - The Clinics vs. Private Medicine

I am a member of a probably dying breed – a pediatrician in private practice who sees Medicaid patients. Although it has been coming for a while, the proximate agent of our extinction is Health Insurance Reform.

Within the 2,000 pages of the reform bills lurks a big issue the public doesn’t hear about – will Medicaid patients be served in the mainstream of medical care, or will they be served in clinics? Many simply assume that Medicaid patients always go to clinics, but they don’t. Medicaid is like a voucher system – a Medicaid card allows you to choose clinic care or a private office that accepts Medicaid. In Alameda County, California, where I practice, despite a multitude of clinics, two-thirds of pediatric Medicaid patients choose private practitioners. So my colleagues and I are actually our county’s “safety net.”

Nationwide, Medicaid’s major problem is that fewer than 50% of primary care doctors accept Medicaid, not surprising given the abysmal payments offered – on average only 72% of Medicare’s already marginal rates. We try to tell the Federal and state governments, “Coverage does not equal access.” You can spread out the money to make more and more patients eligible, but it doesn’t help them if payments are too low to draw doctors in. With low payments, the Medicaid voucher doesn’t give much choice.

By contrast, governmental support of clinics has continually increased. If the non-profit clinic qualifies as a Federally Qualified Health Center, it is required to provide certain extra services (e.g., nutrition counseling), and will often provide services for the uninsured. The FQHC clinic receives the same Medicaid payment as we do, but on top of that, they receive supplemental government payments to “cover their costs.” After this payment, the clinics receive from two to three times as much payment per visit was we do, no matter if the costs are due to extra services, high salaries, or inefficiencies inherent in such entities. Not to mention the charitable gifts the clinics receive from the public and health care institutions.

The Heath Reform bills slant the playing field even further. The House bill would increase Medicaid payments in steps over three years to 100% of Medicare. The Community Health Clinics would receive direct grants of $6.5 billion over 5 years. The Senate’s approach is even more skewed – no increase for Medicaid at all, but $10 billion for clinics over five years (so high reportedly in order to garner support from Senator Bernie Sanders of Vermont.)

It is always difficult for outsiders to know why decisions are made. The clinics have a great beneficent image, the clinic lobby is strong, the numbers seem to work if Medicaid pay is kept low (notwithstanding patient preferences, and notwithstanding that “coverage” does not equal “access,”) and most legislators are generalists who don’t understand the issues in depth.

But we private doctors on the front lines understand the issues all too well. Medicaid starves us, even though so many patients choose us. Unlike many of the doctors at our competitors the clinics (not all), we take nighttime and weekend call, do hospital rounds, see patients on weekends, and work hard on productivity since we are business entities. If the clinics receive the projected huge Health Reform grants, the already tilted playing field will be a mountainside. We will barely survive, and will certainly not be able to attract new practitioners to replace us. And for what? An ideology that pronounces clinics good for the poor, and private medicine bad. Not that the clinics don’t have some wonderful people – they do. But are the clinics better than we are? Not according to patient choice.

Our preferred solution would be simple, straightforward, and less expensive. Raise Medicaid fees to equal Medicare – or above Medicare to attract even more practices and provide us a competitive wage – and let the best model win. Fund us, and we will come.

Budd Shenkin


  1. "Equal to Medicare?" I expected you to go out on a wing for your opening bid.

    In a somewhat analagous situation, I sometimes find myself competing with not-for-profit organizations to deliver management consulting services to local governments. Why are my tax dollars being used to subsidize my competition? If the market can provide a service, let it. Better to focus public resoures where the market fails.

  2. Magnificent post! I do have the same opinion.

  3. Private Testing is speedy and results are found positive with an infection, you can be treated with greater speed. Free Clinics take their time to get you the results.