Let's Take Care of Ourselves

June 1, 2004

Physicians care for others but overlook their own needs - especially when it comes to reimbursement

It's ironic. As a profession, we physicians are devoted to and adept at caring for our patients. We not only treat them when they're ill but also devote a significant proportion of our time to preventing them from getting sick or hurt in the first place. Many of us who are pediatricians even talk with our patients' parents about the importance of taking good care of themselves so they'll be better able to tend to their children's needs.

The irony is that while we may be good at caring for others, we don't always do such a good job of taking care of ourselves -- especially when it comes to seeing that we're appropriately reimbursed for the services we provide.

As I'm sure you are well aware, over the past decade, we physicians have faced significant reductions in reimbursement in both the public and private markets. Pediatricians, in particular, provide more health visits to Medicaid-insured children than all other medical specialties combined. Our Medicaid caseloads increased significantly between 1993 and 2000 -- particularly those in private practice settings, who experienced a nearly 31 percent increase.

As those caseloads went up, however, many pediatricians saw their reimbursements decline as states cut Medicaid funding -- a major component of most state budgets. In every state, Medicaid reimbursement rates are less than Medicare reimbursement rates for the same procedures -- and in most states, the difference is significant.

It's much the same with private sector reimbursement rates as insurance companies misinterpret codes or flat-out deny certain services. The squeeze on pediatricians becomes even more apparent when you consider that 56 percent of our revenue currently goes toward overhead costs, including staff salaries and benefits, facility costs, and malpractice insurance. The situation has reached the point in some areas where pediatricians, like other specialists faced with out-of-control malpractice insurance premiums, have been forced to close shop. 

Everybody's hurting

I realize this bleak picture is not unique to pediatricians. That's why I say it's time physicians in all medical specialties took a dose of our own medicine and start taking care of ourselves so we can take the best possible care of our patients. Reimbursement isn't an easy subject to address because so many physicians feel uncomfortable discussing it. I'm absolutely convinced, however, that children will never receive appropriate healthcare until pediatricians are adequately reimbursed for our services. The same goes for your patients, no matter what type of medicine you practice. That's why the American Academy of Pediatrics (AAP), an organization long recognized as an advocate for children, has taken up this issue on behalf of our patients and our members.

One of our early actions in this effort was the appointment of a Pediatrician Reimbursement Advisory Team to spearhead our efforts. The team is comprised of AAP physician leaders who advise the Academy in the development of workable strategies and initiatives designed to improve the fiscal environment for pediatric services. The Reimbursement Team unanimously agreed that one of the best places to start is right in your own office.

Control what you can

For starters, you must be certain your office is well managed from the standpoint of scheduling, staffing, salaries, billing, coding, collecting, and negotiating with health plans for contracts that reimburse fairly. Contrary to what you may have been led to believe, physicians do not have to accept every contract that is presented to them! Instead, you need to regularly review your fee schedules and managed-care contracts to determine whether it is viable for your practice to remain a member of a particular network and to identify what elements may need to change. Then negotiate those changes. 

Improvements in coding and claims processing is another key area. My colleague, Mark Weissman, MD, FAAP, implemented coding and practice management workshops for the faculty and residents at Children's National Medical Center in Washington, D.C. Within three months, there was a dramatic increase in the use of proper codes as well as an increase in charges per visit as a result of the improved coding, charges and revenue exceeded annual budget targets. It can happen. While we physicians may not think of ourselves as businesspeople, we are indeed involved in small business. We must be sure each office and department continually scrutinizes and refines procedures. 

These internal factors are just one part of the equation. External factors reach beyond our offices -- for example, decisions by major insurers, public and private. The AAP has been active in meeting individually with the major health plans to discuss pediatric issues, submitting letters to carriers on coding and coverage concerns, and informing carriers of AAP policies and guidelines. Pediatricians can expect the AAP to continue to be active on their behalf in the external areas but, internally, they've got to help by instituting controls themselves.

Advocacy works

Rest assured, our members won't be on their own. The AAP has tools to help, in the form of courses, workshops, manuals, and online resources designed to aid pediatricians and their office staff in understanding and implementing sound office practices. A number of our chapters have developed pediatric councils, which regularly bring together chapter leaders and medical directors of managed-care organizations to discuss issues affecting coding and coverage.

Many of our chapters also provide a forum for office managers to meet and exchange ideas. In New Jersey, for example, a Medicaid managed-care plan was able to significantly increase compliance with lead screenings as a result of implementing the New Jersey pediatric council's recommendation to reimburse pediatricians who performed the screening in their offices. It was a winning situation for all sides: the effort not only enhanced lead screening rates, but also helped the carrier avoid a $250,000 noncompliance fine from the state health department.


 I'm sure there are some people who will be concerned about the AAP's efforts to secure appropriate reimbursement for pediatricians. After all, pediatricians have a well-deserved reputation for advocating on behalf of our patients -- the nation's children -- rather than for ourselves. Let me stress, however, appropriate reimbursement to pediatricians is just another step toward our ultimate goal: access to high-quality healthcare for all children -- and all patients.

E. Stephen Edwards, MD, FAAP, can be reached via editor@physicianspractice.com.

This article originally appeared in the June 2004 issue of Physicians Practice.