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Medicaid Rates So Low, Hospitals Consider It Charity Care

Most hospitals have slim margins, and budgets are set based on anticipated average patient reimbursement at Medicare rates. Some private insurers pay higher rates than Medicare, and the differential is often used to offset the cost of treating Medicaid patients. Medicaid reimburses at about half what Medicare pays, which is usually not enough to break even. Out of financial necessity, Medicaid patients are often given limited access to care and services. This is done in some subtle and some not-so-subtle ways. In a recent conversation with an orthopedist friend of mine, he confided in me candidly:

“Some of my colleagues in private practice can’t pay their office overhead if they treat Medicaid patients. So we see poor people with severely arthritic joints left in pain at home. In addition, with bundled payments, the surgeon gets a fixed amount for the patient’s operation and recovery. What incentive is there to send the patient to a rehab facility? It just takes money away from the surgeon. So the poor have to suffer with very long wait times to see someone who will operate on them, and then afterwards they’re on their own for recovery. Patients who go straight home are at higher risk of falling and may have much poorer outcomes. Surgeons get financial incentives for good outcomes, so it becomes a double disincentive to treat Medicaid patients. You don’t get enough for the operation, and you’re likely to get penalized for their poorer outcomes. Some surgeons I know wont touch a patient with Medicaid for any elective procedure. I have ethical problems with that – so I work at a non-profit hospital where we treat everyone. But I have to do higher volume to break even. I work 90 hours a week and barely see my family. I don’t know how much longer I can do it.”

It is common practice among nursing homes to have a limited number of “Medicaid beds.” The facility simply declines to admit more than 20% of patients with Medicaid. I hear case managers on the phone all day long, looking for a post-acute care facility who will accept a Medicaid patient. For the few non-profit facilities who don’t turn them away, deep financial costs are incurred as they struggle for survival.

The reality is that Medicaid rates are so low that having this insurance is not much better than none at all. As I’ve explained previously in the outpatient world (see an example of an insanely low Medicaid reimbursement for eye care), Medicaid is tantamount to charity care. The news that 21.3 million Americans might receive Medicaid coverage in the next decade should not be hailed as a leap forward. As I see it, that’s just a larger group of people with debilitating arthritis who can’t get hip and knee replacements and are left to suffer in pain at home.

Dr. Val, The Traveling Physician: Living La Vida Locums

On Assignment In Idaho

It’s been a couple of months since my last post because I’ve been traveling around the United States working as a locum tenens (in Latin, “place holder” – a more elegant name than “temp”) physician. We’ve all heard of traveling nurses, but more and more physicians are also “living la vida locums,” as it were. There are actually over 100 agencies who find/provide temporary physician coverage for hospitals who need to fill gaps in their full timers’ schedules. You can find out more about these agencies at their trade organization site, the National Association of Locum Tenens Organizations (NALTO).

For those of my peers who’ve been curious about locums work, but haven’t tried it, I thought I’d provide you with some personal thoughts and insights in the form of Q&A. Please feel free to ask your own questions in the comments section and maybe we can generate a nice, interdisciplinary discussion about locums work. I’d love to hear from others who have worked locums!

Q: Why should I work as a locum tenens physician?

If you don’t mind travel and are a fairly adaptable individual (i.e. can learn new EMR systems, staff idiosyncrasies, and navigate hospital politics without excessive angst), then you can expect to make at least 33% more in salary working as a locum (with professional liability insurance, housing and travel covered included). In addition, you have no administrative or teaching responsibilities, coding/billing hassles, or staff management issues. You’re paid an hourly rate for a minimum number of hours, with overtime negotiable. You get to see different parts of the country, and can control where you go and how much you work. (E.g. Summers in Sonoma, winters in Florida… not a bad lifestyle choice.)

Q: What kind of physicians do locums work?

In my experience, there are four kinds of people who do locums work: 1) Retirees – those who have essentially retired from full time medicine and want to keep their hand in clinically without overwhelming responsibilities and work hours 2) Salary Seekers – those who want to make 33-50% more salary and don’t care where they live to do it (they work 22 days/month or more as a locums doc) 3) Dabblers – those who want to work part time because they are busy with another job or family responsibilities and 4) Problem People – those who have personality issues and/or a legal history that make it difficult to hold down a regular job.

I don’t know the relative numbers of these 4 subtypes of physicians who do locums, but I’d guess that 20% are Retirees (Rs), about 10% are Salary Seekers (SS’s), 60% are Dabblers (D’s), and 10% are Problem People (PP’s). I’m a D, and I have met Rs, SSs, and PPs on the work circuit. I’ve also spent time talking to internists and specialists who work as locums physicians so I have an idea of what others outside my specialty are up to.

Q: What’s the difference between locums agencies?

Each locums agency has its own “corporate culture” and some are more attentive to their physicians than others. For example, when you’re traveling en route to an assignment and your flight gets cancelled on a weekend, you suddenly realize how nice it is to have a responsive agency to help with travel triage. Choosing an agency is more than just finding the one that offers the best hourly wage, it’s about how they choose and negotiate with clients (hospitals), how many staff they have to help with payroll and travel, and if the recruiters themselves are patient and attentive. All of this is primarily learned by trial and error – alas. And I think it’s probably time to create a “Yelp” destination of sorts for physicians who are interested in locums work. I wish I had had one!

That being said, what I’ve learned is that agencies vary A LOT in what they offer you and that there is usually about 25% wiggle room in hourly rate negotiation, especially for highly-sought after specialties such as Internal Medicine. In one case, a client (hospital) confirmed to me that two different locums agencies presented the same candidate to them – one was charging $90/hour more for the physician, but the physician had been quoted the same hourly rate by both agencies.

One would think that there would be an advantage to being represented by the “Platinum level” locums agency because they’d negotiate higher pay rates for you, but what happens is that they negotiate high pay rates and then don’t pass it along. In the end, the only hospitals that use those companies are ones who’ve exhausted every other avenue. So if you work for a Platinum agency, you end up with an average salary working in the most difficult situations (i.e. where no one else would go and the hospital, in an act of desperation, had to pay through the nose for you.) In addition, I’ve had a Platinum agency take 3 months to pay me, whereas another agency regularly turned my time sheet into direct pay in 7 days.

So be forewarned – the biggest, shiniest agency might not be your best bet.

Unfortunately, smaller agencies (who may be more generous with salary rates) sometimes suffer from skeleton crew staffing and fall short of being able to triage travel disasters and manage client-related problems (e.g. the hospital said you’d see 12 patients a day but when you arrive they ask you to see 24) as needed.

When it comes to a locum agency, you want someone who’s not too big, not too small, and where you can establish a relationship with a recruiter who is responsive and smart. I cannot stress this enough. Your recruiter is your lifeline while you are on the job. Recruiters don’t just spend their time finding physicians to fill positions, they are the key point of contact between you and the hospital where you work. Their role is to lobby for you, and keep the hospital accountable for your work load and work environment. If the hospital promised that you’d only need to see X number of patients/day, then your recruiter is the one to hold them to that standard. If you are concerned about patient safety because staff members are incompetent in some way, then (believe it or not) your recruiter will convey those concerns to the hospital and get the problem solved.

So overall, your locums experience depends on the corporate culture of your agency, the size and number of travel/credentialing staff they have available 24/7, and the quality of recruiter assigned to your case.

In my next post I’ll cover the following questions:

Q: Where are the most favorable locums jobs?

Q: How can I negotiate the best salary?

Q: How do locums agencies decide how to match you with a given job opportunity?

Q: What is the licensing and credentialing process like? How do I make it easier?

Does Normalizing Obesity Do More Harm Than Good?

It is estimated that 44% of Americans will be obese by the year 2030. The AMA warns that increasing obesity rates will lead “to millions of additional cases of type 2 diabetes, stroke and coronary heart disease, as well as arthritis and hypertension. Billions of dollars will be wasted through lost economic productivity and skyrocketing medical costs.”

And yet, a funny thing is happening in consumer land – efforts to normalize obesity are gaining momentum via social media platforms. Take the “beauty comes in all sizes” ad for example. This was shared with me by an old grade school friend on Facebook. And while I can appreciate the sentiment that women of various genetic predispositions are beautiful, I stopped short at the idea that obesity itself was attractive. There is a growing movement among obese men and women to promote acceptance of their size, and if they win this argument they could substantially undermine efforts to help Americans become healthy and avoid disease. I know this sounds harsh, but to me, promoting beauty of all sizes – when that includes obesity- is tantamount to promoting a “smoking is cool” campaign.

Smoking rates in the United States have dropped from 42.4% in 1965 to 19% in 2010. Although one-in-five people still smoke, we have successfully reduced the smoking burden by more than half. The reasons for this reduction are complex, but they include public awareness campaigns regarding the harmfulness of cigarette smoking, increasing taxes on cigarettes, and public policy regarding where and when people can smoke in public.

The same exact approach can’t work for obesity because while people can simply quit smoking, we can’t quit eating. And what we eat is less important than how much we eat. I personally do not favor “fat taxes” on specific food items because almost any food could cause weight gain if consumed in large enough quantities. I also don’t favor singling out obese people for portion reduction at restaurants (this has actually been proposed), or other policies that are similar to what we’ve done with smoking in public spaces. Promoting prejudice against the obese is not constructive.

So that leaves us with public perception/education and peer pressure as our primary national strategy for reducing obesity rates.  (Of course smaller initiatives can help: employers can incentivize weight loss and wellness, policy makers can encourage new housing developments that promote active lifestyles, and local groups and non-profits can promote fitness initiatives and healthy eating behaviors.)

My concern is that if too many people decide that normalizing obesity is better than fighting it, America will lose this battle. Obesity-related disease is already costing us about twice as much as smoking-related illnesses. And both smoking and obesity are nearly 100% avoidable.

Obesity is not beautiful, and we must redouble our efforts to win the hearts and minds of the public on this subject without resorting to the other extreme (idolizing anorexia). Good health lies somewhere in the middle – and keeping our middles within a reasonable range is the most important health goal we have.

Is It More Important To Make Patients Happy Or To Heal Them?

One would think that happiness and healing are inextricably linked in healthcare, but the Happy Hospitalist (HH) raises an interesting question: is modern medicine’s emphasis on patient satisfaction (and shared decision-making) sacrificing our quality of care? A recent study found that patients who preferred their physicians to take the lead in their medical decision-making had shorter, less costly hospital stays.

HH argues that if physicians are expected to perform like airline pilots, reliably choosing/performing the best course of action for those depending on them, then patients should behave like passengers. In other words, passengers don’t tell the pilot how to fly the plane, nor should patients override a physician’s clinical judgment with personal preferences.

I think this analogy misses the mark because patients are rarely interested in making decisions about how a physician accomplishes her task, but rather which tasks she undertakes. Flight passengers aren’t interested in quibbling about the timing of landing gear, they are interested in the selection of their destination city. And so they should be.

While there may be a correlation between physician-led decision-making and shorter hospital stays, I’m not convinced that this translates to improved care quality. For the study subjects, discharge could have been delayed because the “empowered” patients insisted on ensuring that a home care plan was in place before they left the hospital. Or perhaps they wanted to get their prescriptions filled before going home (knowing that they couldn’t get to their home pharmacy over the weekend)? The study did not assess whether or not the discharge delays reduced readmission rates, nor did it seek to determine the cause of prolonged stays. This study alone is insufficient to draw any conclusions about the relative value of the patient empowerment movement on health outcomes.

While I certainly empathize with HH about the excessive focus on patient satisfaction surveys over true quality care, I strongly believe that an educated, participatory patient is our best ally in the practice of good medicine. There are simply too many cogs and wheels turning at once in the healthcare system to be able to ensure that the right care is provided at the right time, every time. We need all the help we can get to monitor our care plans in order to avoid medical errors, compliance problems and missed opportunities.

If you see something, say something. That principle applies to healthcare as much as it does to flight safety.

Will Insurance Cover A Mole Removal?

In years gone by, I spent far too much time removing small skin bumps in the office. At the time, I was sharing space with another doctor who was profiting by any service I provided. His staff scheduled me with tons of things that simply made me no money. [Meanwhile his stuff diverted some of my better business into his schedule as opposed to mine.]

The facts of life are that medicine is a business and when I am paying a huge chunk of change to overhead, I need to make that back or I operate at a loss.

Patients frequently don’t understand why I cannot remove their moles for what their insurance pays and make a profit. Well, Read more »

*This blog post was originally published at Truth in Cosmetic Surgery*

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