ACA and ENT

[ORLHNS41]

Do any attendings on this forum have an opinion on how the affordable care act will affect otolaryngologists in the near future? I'm a fourth year resident likely going into general practice. Will it still be possible to do well in a 4 or 5 person group, or is it more likely that you'll need to be part of a larger group (>10)? Or, should I lean towards a position with a company like kaiser or HCA and be salaried. Most of my attendings are unsure of the future, but can't speak with regard to private practice.

Also, is there any reason current residents should definitely do fellowships? I love general and all the variety, and I feel my training has been very well rounded. On the other hand, if further subspecializing might be the trend of the future, there are some fellowships I would consider. With the current (and worsening future physician shortage), I can't imagine that subspecializing will be required to perform certain procedures within our field and get reimbursed.

I appreciate any insight on these topics. I'm sure I'm worrying too much, but my students loans are weighing heavily on me right about now... at a nice 6.8%....

---

Members don't see this ad.

 

[resxn]

Do any attendings on this forum have an opinion on how the affordable care act will affect otolaryngologists in the near future? I'm a fourth year resident likely going into general practice. Will it still be possible to do well in a 4 or 5 person group, or is it more likely that you'll need to be part of a larger group (>10)? Or, should I lean towards a position with a company like kaiser or HCA and be salaried. Most of my attendings are unsure of the future, but can't speak with regard to private practice.

Also, is there any reason current residents should definitely do fellowships? I love general and all the variety, and I feel my training has been very well rounded. On the other hand, if further subspecializing might be the trend of the future, there are some fellowships I would consider. With the current (and worsening future physician shortage), I can't imagine that subspecializing will be required to perform certain procedures within our field and get reimbursed.

I appreciate any insight on these topics. I'm sure I'm worrying too much, but my students loans are weighing heavily on me right about now... at a nice 6.8%....

Most people do not know what the ACA will do to ENT's. There is one definite. Inpt procedures will no longer be reimbursed by insurance directly to the ENT. Instead, the hospital will get the cash and then divvy it up to those involved in the care. In other words, whereas if I do a thyroid right now, I'll collect directly from United $1200 or whatever it is. However, in 2015, I'll collect my money from the hospital president.

That has clear implications in that I have to negotiate with hospital presidents now my fee for surgeries and not with insurance companies for inpt stuff. Suppose I'm a solo practice guy and there's also a group of 5 in town and all of us work at the same hospital. Who do you think has the better leverage to get a better rate?

So you say, I'll just be salaried by the HCA hospital in town then. Ok, so now you work for the man. Maybe that's fine. It may work well too, if there are no other competing hospitals in the town your working in.

But let's take my town for an example. I work where there are 3 major hospital systems in play. I cover all 3 with my group. However, let's say I decide to throw my hat in with one of them. I go with Hospital A because they're the biggest and best and offered me the best salary. They give me a 3 year deal. Now Hospitals B&C have no coverage. Are they going to sit by and let A take all the patients? Nope. They're going to hire an ENT or more to cover their needs. Now I'm looking at minimum of 2 more ENT's in my town, but the population didn't all of a sudden grow by 70K people so what happens? My volume goes down. What happens then when I'm not making the numbers in my proforma with Hospital A? Well, when it's time to reup my contract with them, I no longer can command the salary I originally did because there just isn't enough revenue generated to leverage it.

There are only 2 models that are viable in the coming years, in my opinion, in private practice ENT. You can be part of a big group who can cover all the needs of all the hospitals and is so intimidating to the hospitals that they don't want to spend the resources to hire in their own. Or you can try to sign on with one of the hospitals and hope that they remain the dominant force in your town so that you can meet your collection goals (that the hospital will set) in order to make the salary your financial goals demand.

Fellowship isn't necessary for private practice I don't feel, unless your trying to build a niche spot in a competitive community or in a larger group practice. In those instances it can work.

 

[DrBodacious]

There is one definite. Inpt procedures will no longer be reimbursed by insurance directly to the ENT. Instead, the hospital will get the cash and then divvy it up to those involved in the care.

I am no expert on the details of Obamacare, but I haven't heard anyone else talking about this, so I am somewhat skeptical. Resxn, this is blowing my mind, could you please post a reference for this? The major thing everyone is talking about for 2015 is the implementation of value based purchasing. Is this part of the VBP provisions or is it under another section? The ACA sections that talk about VBP seem to be vague as to the actual implementation, and I don't see anything that implies that physicians will no longer be directly reimbursed. What I am getting out of the ACA is that in 2015 reimbursement will be adjusted based on quality measures for specific diseases like MI, stroke etc. For ENT docs, and all surgeons, there are the SCIP measures and medication reconciliation measures that apply.

There is a good report on the distrubution of ENT doctors
Almost 80% of ENTs were in solo or group private practice as of 2009. This seems like it has always been the way to go so you don't share your profit with an employer. The reason to go to an employed position is if you can't stomach the business aspect of medicine. The implications of giving payment leverage to a hopsital could put a significant portion of private practitioners in a very tough spot.

However, I would like to say thank you to resxn and the other attendings for providing their insight in to the business of medicine aspects of otolaryngology. The OP and me (a 5th year resident) are still trying to focus on learning the clinical side of ENT in residency, but these issues are very important to be able to plan for the future. These discussions are the most interesting ones on the SDN forums these days.

 

[resxn]

I am no expert on the details of Obamacare, but I haven't heard anyone else talking about this, so I am somewhat skeptical. Resxn, this is blowing my mind, could you please post a reference for this? The major thing everyone is talking about for 2015 is the implementation of value based purchasing. Is this part of the VBP provisions or is it under another section? The ACA sections that talk about VBP seem to be vague as to the actual implementation, and I don't see anything that implies that physicians will no longer be directly reimbursed. What I am getting out of the ACA is that in 2015 reimbursement will be adjusted based on quality measures for specific diseases like MI, stroke etc. For ENT docs, and all surgeons, there are the SCIP measures and medication reconciliation measures that apply.

There is a good report on the distrubution of ENT doctors
Almost 80% of ENTs were in solo or group private practice as of 2009. This seems like it has always been the way to go so you don't share your profit with an employer. The reason to go to an employed position is if you can't stomach the business aspect of medicine. The implications of giving payment leverage to a hopsital could put a significant portion of private practitioners in a very tough spot.

However, I would like to say thank you to resxn and the other attendings for providing their insight in to the business of medicine aspects of otolaryngology. The OP and me (a 5th year resident) are still trying to focus on learning the clinical side of ENT in residency, but these issues are very important to be able to plan for the future. These discussions are the most interesting ones on the SDN forums these days.

Give me a day. While there's stuff to google on this, it's not great info. One of my best friends is the head of strategy for one of the largest hospital systems in TX. I've had many discussions on this topic with him and I'm asking him to send me some info that I can post or link to. He's a busy guy so it may take a day or two. I think this is crucial stuff to how we practice so I'll get it to you as soon as I can.

In the interim read the AMA's discussion (I hate the AMA, btw, but they at least treat this somewhat fairly here); http://www.ama-assn.org/ama/pub/phy...luating-payment-options/bundled-payments.page

 

[resxn]

Ok, quick update. As of Jan 1, 2013 scattered health care systems (not many from the sounds of it) have agreed to start bundled payments as a test to see it's effectiveness. As with all things with CMS, they have decided not to officially adopt this in 2015 although the ACA grants them this power to do so. There was too much kickback from large and powerful systems who said that they couldn't align physicians quickly enough to make it cost effective. Thus, we have the trials ongoing. I will find out in the coming days some of the hospital systems that are implementing the trial period and let you know who they are so if you so choose you can track their effectiveness. My contact believes that unless this falls flat on it's face, there's a very good chance it will be implemented on a very broad basis within the next 5 years or so.

 

[MOHS_01]

Ok, quick update. As of Jan 1, 2013 scattered health care systems (not many from the sounds of it) have agreed to start bundled payments as a test to see it's effectiveness. As with all things with CMS, they have decided not to officially adopt this in 2015 although the ACA grants them this power to do so. There was too much kickback from large and powerful systems who said that they couldn't align physicians quickly enough to make it cost effective. Thus, we have the trials ongoing. I will find out in the coming days some of the hospital systems that are implementing the trial period and let you know who they are so if you so choose you can track their effectiveness. My contact believes that unless this falls flat on it's face, there's a very good chance it will be implemented on a very broad basis within the next 5 years or so.

CMS pilot programs have an uncanny record for failing to realize savings.... so don't make any major life altering plans just yet.

 

[ORLHNS41]

These are all great points. I appreciate the replies. It will be interesting to see how everything plays out.

 

[OtoHNS]

Yeah, I think bundling is probably the most worrisome thing in Obamacare for the traditional private practice model. If it's really implemented widely, it's going to put a big pressure on surgeons to join either a hospital system or a large group. Either that or just do only outpatient surgeries at a surgery center in which you've invested- seems like at least a semi-realistic option for ENT, ophtho, plastics, but not other surgical fields. I guess we'll have to wait and see what happens...

 

[earboy]

What do you guys think of surgery centers that work on the premise of out of network benefits and balance billing? I have a friend who wants me to join him in such a venture eventually. This place charges the insurance provider high rates for out of network benefits and eats the cost of the patient's out of network personal expense. They are profitable but it seems shady.

There's a big case between Aetna and a group of surgery centers somewhere in Northern California about it now. Aetna claims this group charged them $23 million for cases that would have cost $3 million if it had stayed in network. One example was $60,000 for a bunionectomy that would otherwise cost 1-2K.
It seems pretty unethical and a large cohort of California docs are suing Aetna back for intimidation and trying to steer patients away from out of network even though they offer to cover out of network services to a degree.

I'm not sure I like the idea of investing in a surgery center and self referring so that I can reap the benefit from overcharging big insurance. On the other hand, big insurance is the enemy and only trying to maximize profits. With Obamacare, only more people will be insured and PPO seems like its here to stay.

What do you guys think of this?

 

[OtoHNS]

What do you guys think of surgery centers that work on the premise of out of network benefits and balance billing? I have a friend who wants me to join him in such a venture eventually. This place charges the insurance provider high rates for out of network benefits and eats the cost of the patient's out of network personal expense. They are profitable but it seems shady.

There's a big case between Aetna and a group of surgery centers somewhere in Northern California about it now. Aetna claims this group charged them $23 million for cases that would have cost $3 million if it had stayed in network. One example was $60,000 for a bunionectomy that would otherwise cost 1-2K.
It seems pretty unethical and a large cohort of California docs are suing Aetna back for intimidation and trying to steer patients away from out of network even though they offer to cover out of network services to a degree.

I'm not sure I like the idea of investing in a surgery center and self referring so that I can reap the benefit from overcharging big insurance. On the other hand, big insurance is the enemy and only trying to maximize profits. With Obamacare, only more people will be insured and PPO seems like its here to stay.

What do you guys think of this?

Yeah, some of the local surgery centers near me do this as well. I agree it seems shady though it is fully legal according to current insurance rules. My feeling is that the insurance companies are going to wise up and close the loophole at some point, probably sooner rather than later.

 

[resxn]

What do you guys think of this?

While this is a practice that has made a boat load of money for a lot of physicians the wave has almost reached shore. You probably have about 2-3 more years before every insurance has stopped allowing this practice. It's probably the single biggest oversight they've ever made.

In TX BC/BS has stopped paying OON rates and now pay medicare rates for OON surgery centers. All of the other payers will follow. The suit in CA is huge and is being watched all over the country. If Aetna wins this, there will be a fallout of biblical proportions all over the US.

Your benefit of getting in on this deal entirely depends on their last 12 months of distributions. If you will make your investment back in less than a year, I'd do it. If it would take longer than that, I wouldn't probably do it. In other words, if you don't graduate until next summer, forget it. At least that's my feeling.

 

[resxn]

CMS pilot programs have an uncanny record for failing to realize savings.... so don't make any major life altering plans just yet.

true prior to 2005, but scarily efficient at doing it since.

Just ask the ENT group in PA that had to pay $720k back to CMS and the one in NY that had to pay $430k among many others involved in the recent audit increases. That's one example of many in which CMS is fighting back. Check the 60 Minutes special on them going after fraudulent DME shops for another.

Times have changed. Willingness to allow an expensive status quo to exist is no longer an option. People will lose jobs for status quo. Those who rise will find ways to save the cash. Unfortunately, that means gunning for us in a big way.

The problem with not making major career changes right now is that when the S hits the F, there won't be enough time to react in our specialty in the way we need to remain independent with the exception of those communities where you can join a pre-existing megagroup. In my community, there are none, so I'm making one. I don't want to be the guy begging to join, I want to be the guy others are begging. If nothing ever happens this way, I still end up sitting on top of a very large and hopefully, very successful ENT group.

I'm not trying to be Chicken Little here, I'm not even reading the tea leaves. Regardless of what form it takes, life for physicians is changing. Pay for performance, bundling, decreased rates, single payer pushes, increased use of midlevel providers, whatever the mechanism, the days of free cash are over. Medicine will have margins so much slimmer in the near future that we really will be fighting to maintain anything close to the incomes our profession has grown accustomed to.

 

[MOHS_01]

true prior to 2005, but scarily efficient at doing it since.

Just ask the ENT group in PA that had to pay $720k back to CMS and the one in NY that had to pay $430k among many others involved in the recent audit increases. That's one example of many in which CMS is fighting back. Check the 60 Minutes special on them going after fraudulent DME shops for another.

Times have changed. Willingness to allow an expensive status quo to exist is no longer an option. People will lose jobs for status quo. Those who rise will find ways to save the cash. Unfortunately, that means gunning for us in a big way.

The problem with not making major career changes right now is that when the S hits the F, there won't be enough time to react in our specialty in the way we need to remain independent with the exception of those communities where you can join a pre-existing megagroup. In my community, there are none, so I'm making one. I don't want to be the guy begging to join, I want to be the guy others are begging. If nothing ever happens this way, I still end up sitting on top of a very large and hopefully, very successful ENT group.

I'm not trying to be Chicken Little here, I'm not even reading the tea leaves. Regardless of what form it takes, life for physicians is changing. Pay for performance, bundling, decreased rates, single payer pushes, increased use of midlevel providers, whatever the mechanism, the days of free cash are over. Medicine will have margins so much slimmer in the near future that we really will be fighting to maintain anything close to the incomes our profession has grown accustomed to.

Do you have any links to CMS recouping these monies from the ENT groups? Is this a RAC audit? If so, we are talking about two very, very different things (and I know the DME example is dissimilar) as RAC audits are targeting after the fact, looking for deviations from "appropriate" billing and what we were discussing was CMS pilot programs for cost savings (medical homes, preventive care, etc). RAC audits will recover money; these prospective pilot programs have, thus far at least, been miserable failures.

We are expensive labor with limited legal capacity for any form of leverage. I would not, in any way, feel "safe" being the first through the door in any of these programs wherein the hospital systems hold the cards. You're both high cost and a liability... and, I believe, soon to be easily replaced given the coming dissatisfaction with healthcare provision and the number of providers we have that will soon be chasing a shrinking pie.

Our only hope is to counter with similar force / leverage -- form dominating groups and hope that it is prohibitively expensive for the hospital groups to hire replacements. If you do not maintain corporate autonomy there will be no way in hell to maintain clinical autonomy... and your pay will reflect your new found status of expensive hospital b*tch.

To quote Samuel L, docs had better begin to "wake the **** up" if they want to remain relevant.

 

[BuddyDog]

From the absurdly naive viewpoint of a 3rd year medical student- this talk is across the board, right? If I love ENT and am pursuing it, is this a reason to switch to some other surgical subspecialty that I could tolerate? For example ophtho- I find ENT procedures much more fascinating, but would the fee for service and physician owned outpatient surgical ability of ophtho be worth it in this new medical atmosphere? Thank you all

 

[badasshairday]

From the absurdly naive viewpoint of a 3rd year medical student- this talk is across the board, right? If I love ENT and am pursuing it, is this a reason to switch to some other surgical subspecialty that I could tolerate? For example ophtho- I find ENT procedures much more fascinating, but would the fee for service and physician owned outpatient surgical ability of ophtho be worth it in this new medical atmosphere? Thank you all

Every specialty is going to be hit hard as fee for service ends. I know it is cliche and been said a million times: Just pick what you like.

 

[resxn]

Do you have any links to CMS recouping these monies from the ENT groups? Is this a RAC audit? If so, we are talking about two very, very different things (and I know the DME example is dissimilar) as RAC audits are targeting after the fact, looking for deviations from "appropriate" billing and what we were discussing was CMS pilot programs for cost savings (medical homes, preventive care, etc). RAC audits will recover money; these prospective pilot programs have, thus far at least, been miserable failures.

We are expensive labor with limited legal capacity for any form of leverage. I would not, in any way, feel "safe" being the first through the door in any of these programs wherein the hospital systems hold the cards. You're both high cost and a liability... and, I believe, soon to be easily replaced given the coming dissatisfaction with healthcare provision and the number of providers we have that will soon be chasing a shrinking pie.

Our only hope is to counter with similar force / leverage -- form dominating groups and hope that it is prohibitively expensive for the hospital groups to hire replacements. If you do not maintain corporate autonomy there will be no way in hell to maintain clinical autonomy... and your pay will reflect your new found status of expensive hospital b*tch.

To quote Samuel L, docs had better begin to "wake the **** up" if they want to remain relevant.

Yes, I'm talking RAC audits and it's far easier to recoup money in an audit than predict how to save in the future but to assume it won't happen is ignoring every indication out there and furthermore the pressuring trends of the last 24 months in particular. While many of their programs have failed, ask the cardiologists how their 30% cut 2yrs ago fared. Also, ask the hospitals how nonpay for complications fared. They are going to continue to find ways to not lose money to us, to hospitals, to surgery centers, to therapists, radiology centers, etc etc.

100% agree with everything else you said.

 

[MOHS_01]

Yes, I'm talking RAC audits and it's far easier to recoup money in an audit than predict how to save in the future but to assume it won't happen is ignoring every indication out there and furthermore the pressuring trends of the last 24 months in particular. While many of their programs have failed, ask the cardiologists how their 30% cut 2yrs ago fared. Also, ask the hospitals how nonpay for complications fared. They are going to continue to find ways to not lose money to us, to hospitals, to surgery centers, to therapists, radiology centers, etc etc.

100% agree with everything else you said.

I should point out at this point that we took a 30-35% revenue hit in 2008 due to the loss of the multiple procedure reduction exemption. For like work this translated into a 40-50% reduction in practice profits (granted, very few realized that size hit because we diversified our practice mix, maybe shied away from some cases that we used to would have done, tweaked our scheduling, referred more out for reconstruction, etc). We are looking at another 25-30% RVU hit next cycle according to our leadership (2014).

It still goes back to what I said earlier; we have zero (negative?) leverage with Medicare... and our only choice is to drop out as a participating provider. If you are a minority provider in your market, whoop-e-dee-doo if you drop out - no one will care and the primary recipient of the pain will be you and your family. If you're the dominant provider in such a way that your group is prohibitively expensive to replace, you stand a chance. In such a setting you will likely maintain better private insurance reimbursements, softening the blow. Better still, when you drop MC these patients will either pay you directly (unlikely) or flood anyone else in town, driving the better paying private insurances to you.

Unless you are a pathologist, radiologist, or anesthesiologist, I believe some degree of leverage can, should, and will be retained by the physician community (especially if we put little pricks like me in leadership positions).

 

[dilated]

Do you have any links to CMS recouping these monies from the ENT groups? Is this a RAC audit? If so, we are talking about two very, very different things (and I know the DME example is dissimilar) as RAC audits are targeting after the fact, looking for deviations from "appropriate" billing and what we were discussing was CMS pilot programs for cost savings (medical homes, preventive care, etc). RAC audits will recover money; these prospective pilot programs have, thus far at least, been miserable failures.

While I think you're right about their prospective pilots failing until now, the bundled payments are different. They are not trying to save money through changing care (rehospitalizations, etc), they are just changing the payment format in a revenue neutral way (existing doctors+hospital+outpatient payment=new bundle payment). Obviously once that is established they will just ratchet the overall bundle down every year to squeeze "inefficiency" (i.e., payment to the party with the least leverage, doctors) but I don't see it being all that difficult to establish.

But I don't think every specialty will be hit evenly. The excitement over "bundle billing" has mostly been for medical care like pneumonia that is billed in a volume an order of magnitude larger than any surgery code. Surgery is relatively less exposed because there are more codes, each code is billed far less often and there's just not as much money to get out of it. The hospital is already paid in a bundle for surgical care as is the surgeon so all you can get from complete bundling is to extract more out of the physician payment and there's not much blood left in that rock. The biggest threat to us is not financial, it's that as they force participation in ACOs it will push every doctor in the US towards hospital employment which will destroy the last autonomy of the profession and ability to advocate for your patients against your employer when needed.