Here is a well-known scenario for many mature Americans. You are either about to turn 65, or it is approaching open enrollment for the following year; and you are being flooded with phone calls and letters in your mailbox from insurance agencies. There may also be “health fairs” organized at local senior centers. The goal of these schemes is to try to enroll you in a managed care plan. Before pursuing these offers, it is imperative that you fully understand what is at stake.
Medicare is one of the best things the US government has done to ensure the well-being of retirement age Americans. It provides a low cost healthcare option and unmatched freedom to see the doctor of your choice. It also provides the freedom to order the necessary testing, medications, and treatment options for you with little hassle and delay. There are minor pitfalls (like the $166 calendar year deductible and the 20% co-insurance) that make it harder for low income Americans, but these costs can be offset by purchasing an affordable Medicare supplement plan. For those retired Americans who fall below the poverty line, the no-cost option of applying for Medicaid as your secondary insurance is available. There is a monthly premium for Medicare, which is deducted from your social security income. Here is a graph showing how this premium is determined.
The alternative to Medicare is enrolling in one of the managed care or capitation options that insurance companies and brokers sell. These plans replace Medicare with a plan from a commercial insurance company. Essentially, you give up Medicare for a plan offered by a for profit insurance company. These plans require a Primary Care Physician (PCP), and this PCP, becomes the “gate keeper” of your healthcare. It sounds good, but it isn’t. The problem lies in how the PCP is compensated. The insurance company gives them a set amount of money per month for your care. Whether they see you one time or ten times, it is the same amount of money; but if you need to be referred out to see a specialist (or to have a diagnostic test), money gets deducted from that amount. This reimbursement structure places the PCP in a very difficult position. In a solo practice, one physician relies on this money to cover costs and make a living. In a group practice where the physician is an employee of a hospital or other corporation, he has guidelines he must follow to keep costs down; and reduce the amount of money being taken from this pool of money that is received for your care. This is the worst. Not only do you have a doctor that has to look out for his own financial stability, but he also has to look out for the financial requirements of the corporation that employs him.
Under capitation, Physicians are given incentive to consider the cost of treatment. Pure capitation pays a set fee per patient regardless of the degree of their infirmary, and gives a physician incentive to avoid the most costly patients.
– Harold D. Miller, Center for Healthcare Quality and Payment Reform
Let’s say you come to the PCP because you have a cough with bloody sputum and chest pain. He knows you need a CT scan of your chest to see if there are any nodules or masses, but he chooses to send you for a plain film chest x-ray because it is cheaper. It could come back normal because a plain film chest x-ray may not detect a sub-centimeter nodule. He then decides to send you home with antibiotics, oral steroids and an inhaled corticosteroid, as if you had simple bronchitis. You find no relief and return a month later with worse symptoms. At this point, he finally decides to do a CT scan of your chest. The CT scan shows multiple nodules, over a centimeter in diameter and also some abnormalities in your liver, sternum, and spine. This indicates metastatic lung cancer which is inoperable and incurable. Had the CT scan been ordered at that first office visit, it would have been very possible that metastasis or spreading had not yet occurred. Prior to metastasis more treatment options are available. This is a worst case scenario, but one I have seen multiple times in my 10 years of medical experience in a pulmonary office. Delays in proper treatment for any reason can be detrimental.
Another negative aspect of managed care is the limited provider networks. Insurance companies hand pick doctors that they feel will help keep costs low. This limits the quantity and quality of available doctors. The insurance companies also contract with one or two home health, durable medical equipment (DME) and Hospice companies in an area. They choose the company based on who will provide the necessary services for the lowest possible cost. This almost always results in poor patient care. Until recently, there was only one DME company in Central Florida who accepted the majority of these managed care plans. In my experience, patients have had to wait twice as long to receive ordered equipment (i.e. oxygen concentrators, CPAP machines, wheelchairs), received low quality equipment, and were not provided adequate instruction on its use. For example, many DME companies employ one or more respiratory therapists to instruct patients on use of CPAP and other respiratory equipment. This company did not and often times shipped equipment to the patient’s home with a DVD. This resulted in many patients being non-compliant with use of necessary medical equipment.
Ultimately, ensuring proper healthcare for retirement age Americans is very important. As we age, our need for medical care typically increases; and we need to make decisions to ensure that we will have the best options for quality healthcare available. Keeping Medicare is the best way to accomplish this.