• Industry News
  • Access and Reimbursement
  • Law & Malpractice
  • Coding & Documentation
  • Practice Management
  • Finance
  • Technology
  • Patient Engagement & Communications
  • Billing & Collections
  • Staffing & Salary

The Challenge of Providing Affordable Primary Care


Their practice was founded on the principle of affordable care for patients, while providing a good living for its owners. Now that dream is fading.

It's been three years since we first started writing about our day-to-day issues encountered while delivering primary pediatric care to our patients in Plymouth, Mass., America's hometown. And just about a year since we posted our concerns over our ability to remain financially viable. We thought we'd dedicate this month's blog to reviewing how we're surviving (for now) and what our concerns are for the future.

First, a bit of background. When we decided to open our micropractice in 2006 our goal was to see half the number of daily patients that a typical pediatrician would, and make up for the lower revenue by having little-to-no-staff. Our goal was twofold: to give Terence, as a solo provider, a much more professionally satisfying experience than he had when he was responsible for 5,000 patients as an active duty physician with the U.S. Air Force. And, to give our patients an affordable "concierge" level of care that would create a stronger doctor-patient relationship. Like any startup it took us a few years to build a large-enough patient base, but by year three we were earning enough money to justify Terence working for himself. And by year five, we were each earning an average salary or higher. In fact, in 2013, the year we started this blog, we far exceeded even our own high financial goals, and promptly booked ourselves a European vacation. Our ego blossomed!

The numbers, sadly, changed dramatically starting in 2015. Politically we are liberal, so it pains us to say the Affordable Care Act broke our business plan. It was especially shocking because during the six years before the ACA became law, we were quite successful practicing in Massachusetts under "Romney Care," where although high-deductible plans existed, we saw very few. Plus, for the first two years of the ACA (2013 and 2014) we did especially well because Massachusetts' Medicaid plan had to pay us at least Medicare rates, due to the parity rule in the ACA. Prior to 2013 (and 2015 through today) the State of Massachusetts only pays Medicaid providers 68 cents on the Medicare dollar. It hurts.

So, how are we surviving? Through cost cutting (namely not replacing our beloved nurse practitioner who left for a shorter commute), we have decreased expenses enough to handle the downturn in revenue caused by the combination of lower Medicaid reimbursement and lower acute demand, driven down by high-deductible plans.

We also increased our routine well-exam capacity, while limiting acute-care needs. We are financially motivated to book as few sick visits as possible, in favor of more well exams. A very large number of our patients with commercial plans have Medicaid as a secondary plan. Prior to 2015, for these patients we mostly only lost out on the copay. These days, with high-deductible plans, we end up only collecting the terrible Massachusetts Medicaid rate for the acute visit and that's not enough to pay the electric bill. For this reason, we give as much free care over the phone as we can and endorse the use of retail urgent-care clinics; we only bring in patients who truly need to be seen. The well exam, on the other hand, is paid at the commercial rate because it is a preventative service, so the Medicaid secondary plan has no financial impact.

Today we are surviving, but there is a cost to our community as we decrease access for Medicaid, lower class, and middle-class patients in our practice. Two years ago we worked with four Medicaid plans in our state. We are currently down to only two, and soon (October), that will become one. And the one we're staying with is being converted to a pediatric Accountable Care Organization (ACO) with a lot of risky unknowns for a small practice like ours. It's impossible to build a business plan when we can't forecast revenue, patient demand, or understand the cash flow reality of the new ACO payment system.

We are trying to stay hopeful for the future and want to believe that the ACO will pay us an average primary-care salary. Of course, if it doesn't, we will be asking those Medicaid patients to leave as well and see only commercially insured patients. If that happens, it'll be the right financial move for our family, but terrible for the middle-class families in our community. I'm not sure our liberal hearts can take it.

Related Videos
Krisi Hutson gives expert advice
Krisi Hutson gives expert advice
Krisi Hutson gives expert advice
Krisi Hutson gives expert advice
Krisi Hutson gives expert advice
Krisi Hutson gives expert advice
Dr. Reena Pande gives expert advice
Dr. Reena Pande gives expert advice
Dr. Reena Pande gives expert advice
Dr. Reena Pande gives expert advice
© 2024 MJH Life Sciences

All rights reserved.