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Practice management 2.0
Bruce T. ADORNATO
Recently I received a request from an old friend and patient. She asked
that I call her childhood friend to explain why she could not find a doctor
for herself in Palo Alto.
The friend, a successful retired businesswoman more than a decade into Medicare eligibility, wanted not just any doctor, but a general doctor who would spend time talking with her. She wanted a doctor who did not employ a nurse practitioner, physician's assistant, or a medical "trainee" as a surrogate. Her new doctor would also accept Medicare, file her supplementary Medicare forms, always call back the same day or evening, and have an office near the hospital. The doctor would understand she did not like being referred out to a specialist for every ache, pain, tingling finger and sun spot, and she absolutely did not tolerate getting "bled out at the lab or x-rayed and magnetized every 12 weeks." Was this too much to ask?
"Yes," would be the simplest, mildly humorous answer that I could come up with. (More diplomatic alternatives included: "They don't make those doctors anymore," or "Those doctors live in retirement homes," or "They moved to Idaho.") But the real answer follows some timely questions:
"Why are small private independent pharmacies so hard to find? Why is the new outpatient pharmacy at Stanford a Walgreens? Why are there so few independent gas stations? Where did the mom and pop groceries go? Why did the independent video store in Midtown close last month?
Economics and the laws of unintended consequences can help provide answers. Medical office space in Palo Alto is at a premium thanks to good weather, stringent zoning and parking requirements. Successful businesses and Stanford are buying property and leasing all available office space, which keeps rates up. Because of scarce, expensive personal housing, office staff earn about twice in salary and benefits what they would receive if they lived in lower cost areas. Office expenses, including HIPAA and Medicare documentation, OSHA, Workers Comp, and everything else seem higher in this area than elsewhere.
We've had 20 years of government and insurers paying lip service to the need to increase reimbursement for "cognitive" medicine (i.e. history taking, physical exams, decision making and counseling). However, the reality is that lab tests, surgery, injections, imaging and other procedures receive better reimbursement than office diagnosis, disease management and counseling - no matter how intuitive, accurate and effective the latter are. For example, a recent national practice analysis of neurology predicted that unless a neurologist embraced and provided EMG, EEG, Botox therapy, industry consulting, clinical trials, and other procedural services, he or she would be out of business in five years because of the mismatch of rising costs and diminishing reimbursement.
So what's the answer?
First, we have to understand and communicate to our patients that the low overhead, talking practice went away shortly after Marcus Welby, MD was dropped from NBC. Right now, we do the best we can to be compassionate, and delivery is offered in a two-tiered system. The typical model is institutionalized group practice for internists, general practitioners and other cognitive types; in this model, cognitive practitioners' services are subsidized by their associates who perform lab tests, imaging, surgery and other procedures. In an institution or formal group practice, this Robin Hood-like model for distributing payment is allowable under the Stark laws, named for Fortney "Pete" Stark, the Alameda County Congressman who has backed legislation and advocated for changes in our health care system.
The second model is "boutique" practice, where high costs of cognitive-only services are passed on to the consumer.
But maybe there is a third way - a "clinic without walls," where the hospital would embrace a group of private practitioners, who would be offered reasonable office rents, as well as overhead-lowering services such as pooled transcription and office management. In return, the cognitive physicians would provide allegiance to the hospital's services and referral network. However, this practice is considered a system of "kickbacks" and is forbidden under current federal law. (The practice is punishable by fine and imprisonment). So the devil is in the details, and perhaps we should get our lawyers working on finding a way to turn "kickbacks" into a win-win-win "cost sharing" scenario that will work for physicians, the hospital and our patients. Although previous models of individual practice associations (IPA's) seem to have come and gone, few of them had the backing of a solvent and enthusiastic hospital base.
A new paradigm is especially timely as we approach the year 2008 - the year the 1968 Stanford/City of Palo Alto agreement will expire. At that time, Stanford Hospital will no longer be contractually obligated to provide access to local physicians outside the Medical School's full time and voluntary faculty. (For background and details on the agreement, see http://elane.stanford.edu/wilson/index.html). We hear that Stanford Hospital will remain an open staff institution, and I personally think that this would be an opportunity to strengthen the gown and the town relationship.
