Third-Party Payers: A Necessary Evil in Medicine?

January 21, 2011

As many third-party payers tighten their belts even further with restraints for prescription drug coverage, radiology services, specialty referrals, etc., we physicians are left at the end of the day spending even more time with filling out more forms, seeing less patients, and seeing our total costs increase even more as our overall efficiency decreases.

As I reflect on the many obstacles that physicians face in the day-to-day practice of medicine, I can’t help but think about the seemingly endless burden of the administrative hurdles that we face. I think everyone would agree that in today’s healthcare system the costs are excessive. However, are the increases in costs the result of physician actions? Insurance companies and healthcare plan administrators would argue that this is correct, however I would disagree.

Of course I place a certain value on the care that I provide to my patients. I went to college and graduated with two degrees in four years. I completed medical school in four years, as most physicians do. I then finished my family medicine residency after three years. Adding up the total time commitment equals 11 years for most in primary care. After such a long time investment in building our careers, the salaries commanded by most primary-care physicians is not in line with the paychecks of other professionals. Taking this into consideration and looking at the cost of the average office visit, I really do not see how the services we provide to our patients can necessitate such increases in the costs of healthcare.

Just this past year, my personal health insurance premium increased by 14 percent. If you look at the average increase in the reimbursements for office visits and the procedures I provide to my patients, one will certainly not see such an increase. Where does the extra money go? Prescription drug costs increase each year. Imaging service costs increase each year. Copayments increase and deductibles increase as well. I do not see the need for such increases.

In my practice, I have a very high utilization of generic medications that save my patients a great deal of money each year. The patient that complains of acute back pain does not have a routine MRI ordered after just days of symptoms. Hospital length of stay is very low and patient satisfaction increases as each year goes by. However, the costs continue to rise.

Certainly our patients cannot afford current healthcare services without the aid of third-party payers. However, the high administrative burden of dealing with these third-party payers can be very overwhelming for most of us in the trenches. It seems that almost any radiology test other than routine films carries with it the need for a prior authorization. My nurses have a very high frustration level due to prescription drug prior authorizations as well. At times, I wonder if the prior authorization process is even necessary at all. If we as physicians practice evidence-based, cost-saving medicine for our patients each day, why then does the administrative burden increase annually?

As the new legislation unfolds and we are dealt with the task of trying to figure out the massive new healthcare reform bill, I am very much concerned that the costs will not go down as many experts have predicted, but rather will increase tremendously. As many third-party payers tighten their belts even further with restraints for prescription drug coverage, radiology services, specialty referrals, etc., we physicians are left at the end of the day spending even more time with filling out more forms, seeing less patients, and seeing our total costs increase even more as our overall efficiency decreases.

I do not pretend to be a legislator and certainly do not consider myself to be a political person. However, the high administrative burden on physicians will have to be dealt with. I am fearful that more physicians will elect not to participate in these healthcare plans and the end result will cause many of our patients to not receive the services they need.