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chemosabe
anonymous snipe artist
(12.45.222.162) on 2/28/2013 - 1:19 p.m. says: ( 8 views
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"Medical billing, oversimplified"
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This seems to keep coming up, mainly due to the ignorance of so called "medical journalists" in the lay press, so I will attmept to explain how billing and "prices" are determined and why:
CMMS (Medicare) sets the basis for all fees in the US. Medicare demands that they get the lowest possible fee charged. Sort of. They seem to only enforce that when they want to. Providers are bound by the Medicare Allowable fee and the Usual and Customary Fee and may not Balance Bill in most circumstances (once again dependent on Medicare's willingness to enforce their rules).
Here is a real world example. A twenty minute visit with me, a specialist, has a Medicare Allowable fee of $94.50. That means I am not allowed to collect MORE than that amount for a 20 minute visit (99213) for any Medicare patient because I am "PAR" (participating) in Medicare. If I stopped being "PAR" then I could collect no more than 115% of that amount or $108 from any Medicare patient. (There are billing reasons in regard to labs/tests/drugs as to why I do not go "nonPAR").
Medicare will pay 80% of that $94.50 and either the patient or their supplemental insuirance is expected to make up the other 20%. But I may NOT collect more than the allowable amount.
If I gave up my practice to my local hospital (I have another "emergency meeting" with the CEO tomorrow where he will try to pressure me to do so) then they will be allowed to bill 130% of my fee AND collect a "facility fee" which will basically raise my fees by 2-3x for the same service. Does not mean I will see it..the hospital will collect the extra and I will be on flat salary. Tha ACA encourages this which is why I have been predicting it was going to drastically RAISE the cost of healthcare. Which it is doing.
In most regions of the country, private insurance fees are pegged to the Medicare rate, paying between 115%-150% of the Medicare Allowable. (I am in a predominant medicare area, I only get Medicare rates). It is MUCH more profitable to be a doctor somewhere with very little Medicare.
If I only charged the Medicare rate of $94.50 and Medicare decided to raise their rates next year, I would be restricted to billing at the old rate because that is determined to be my "Usual and Customary Fee". So..my "billed fee" is always higher than whatever fee Medicare might concievably raise fees to..usually 2x the current Medicare Allowable..even though I never collect that from a Medicare patient. In those instances where I have a cash paying patient who has money (mostly Europeans or canadians) I issue a billed fee statement but only have them pay me the Medicare fee. That is what most doctors I know do..but corporate doctors do not have that choice..they bill what their corporation demands which is usally the full billed fee.
My overhead costs of my office (mainly staff salaries and benefits, mortgage on the building, utilities, medmal etc) is about $200 an hour. I do not make any money for myself until that is paid. Medicaid pays me $24 for twenty minutes. So I lose money on overhead with every Medicaid patient I see. The Obama Administration suggested states LOWER the Medicaid reimbursements to help fund the Medicaid expansion. They specifically said they have no obligation to cover docotrs overhead costs. If the "Doc Fix" does not come through then there will be a cut in the Medicare Allowable fee by 30%, which would put my total reimbursement BELOW my overhead costs and leave nothing from which I can draw my own salary. That would force me to either close completely, or reduce overhead (reduce staff as that is my biggest expense) which, in trun would force me to reduce services (phone in prescritpions, call backs to patients, filling out forms) as well as charge a "concierge" fee. That is one of the reasons so many doctors are giving up their practices and becoming employees of hospitals. The problem is, this is not only allowing fees to go up sunbstantially, it is creating monopolies in the provision of healthcare which is further putting upward pressure on fees.
I predictied this three years ago here on the WHAB when the ACA passed. It is now coming to pass.
As an aside, before i fell ill last year I was being offerred jobs in canada and Europe (not Britian) for the equivalent of $350,000 a year. (Remember, I have dual citizenship with ireland so I am technically an EU citizen and do not need a work visa..I also speak German) That is the going salary there..and it is more than what I can make in an 80% medicare community in the US. So this is not about me making more money for myself.
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