Some Doctors Letting Patients Skip Co-Payments

NY Times ^ | December 27, 2003 | MILT FREUDENHEIM

[neverdem]

For years, health plans have sought to control medical costs by negotiating fees with a group of preferred doctors and requiring patients to pay extra for going outside the network. But some doctors and clinics - eager to help hard-pressed patients or calculating that it can benefit their business - have begun to foil the cost-control efforts by waiving those extra charges.

The move by these providers to dispense with collecting what are known as coinsurance payments comes as employers and insurers try to discourage overuse of health care by making patients pay more costs from their own pockets. But those efforts - and the squeeze on doctors as health plans shrink payments for in-network care - are generating resistance, experts say.

Health plan members are "going out of network for surprisingly expensive medical services,'' said Tom Farley, who audits managed care plans across the country for the Towers Perrin consulting firm. That behavior suggests "some sort of tacit agreement between the provider and the patient to not bill for some of those out-of-pocket expenses,'' he said.

Dr. Michael O. Fleming, president of the American Academy of Family Physicians, said that doctors' efforts to find ways around the insurers' cost-control strategies are "a reaction to the ratcheting down of managed care fees.''

Doctors are waiving coinsurance payments for several reasons, analysts say: to recruit patients who would otherwise go to doctors on a health plan's preferred list; to help people struggling with the cost of care, and to reduce their own costs for processing insurance paperwork and dunning patients who are slow to pay.

These doctors can afford to pass up the payments because the out-of-network fees they collect from insurers often are higher than those they would collect as members of a health plan's network.

Dr. Herbert Dardik, chief of vascular surgery at Englewood Hospital and Medical Center in New Jersey, scorns collecting co-payments. "I look at it as a demeaning process,'' he said. "I tell my secretary upfront, if there's any issue, just forget it.''

While most doctors still work within managed care networks, waiving patients' payments appears to be most prevalent in the Northeast, South Florida, the West Coast and the upper Midwest - "areas that are saturated with managed care,'' Dr. Fleming said.

In 2003, more than half of workers faced co-payments of 30 percent or more of the fees charged for visits to out-of-network doctors, according to a September report by the Kaiser Family Foundation. The average out-of-pocket costs, including co-payments and other charges, for employees of large companies doubled in the last five years, to $2,126, and are expected to jump another 22 percent next year, Hewitt Associates, a benefits consulting firm, reported recently.

From the health plans' perspective, moves by providers to waive the payments are "exactly what managed care plans are supposed to protect against,'' Mr. Farley said. "The physicians can go back to practicing without constraints,'' he said, for example ordering more tests and procedures.

For out-of-network care, doctors at the Alliance Surgical Group in Morristown, N.J., ask patients to pay any deductible owed under terms of their health plan, a sum that can be as much as several thousand dollars, according to Dr. David Ward, a member of the group. But they do not press for payment if a patient cannot pay a follow-up bill for 20 percent or 30 percent coinsurance. "The deductible could be the whole bill,'' Dr. Ward said. He does general surgery and specializes in bariatric procedures for people who are obese.

Not surprisingly, patients are pleased. "I was amazed that these doctors do not come after the patient demanding the uncovered costs,'' said Lauren Dasylva, one of Dr. Ward's patients, in a statement she posted on a patient support Web site. "I think that is a testimony to why they do this surgery, I am convinced that they have a heart.''

But patients who choose an out-of-network plan run the risk of paying more than if they selected one of their health plan's preferred providers, said Randy Kammer, a vice president of Florida Blue Cross and Blue Shield. "There is no obligation for an out-of-network physician not to balance bill,'' she said, using the term for collecting charges in excess of those approved by the health plan.

Regularly waiving co-insurance payments or co-pays _ the $10 or $20 payments many plans impose for office visits - is against the rules in the government Medicare and Medicaid programs. A few states - Colorado, Georgia, Nevada, South Dakota and Texas - also prohibit the practice for patients covered by commercial insurance, according to Dennis M. Barry, a Washington lawyer who studies health care reimbursement issues.

Colorado and Georgia also forbid advertising the waivers to attract business. A handful of states have banned the waiver of co-payments and deductibles by dentists and chiropractors. And Ohio prohibits routine waivers of co-payments, but not deductibles, by physicians, pharmacists, psychologists, physical therapists, nurses and optometrists, according to a survey published last month by Mr. Barry and Lori Mihalich.

Waiving payments for indigent patients or to placate those who have complaints about their treatment "should not pose legal issues,'' however, they said.

A policy statement by the American Medical Association's Council on Ethical and Judicial Affairs says that "physicians should forgive or waive the co-payment'' if it would pose "a barrier to needed care because of financial hardship.'' The statement warns, though, that "routine forgiveness or waiver of co-payments may constitute fraud under state and federal law.''

[neverdem]

Third party payers have made a complete mess. If a doc feels compelled to commmit charity, then the doc may be an accomplice in fraud.

Happy New Year

[neverdem]

PING

Happy New Year

[ThinkDifferent]

Third party payers have made a complete mess.

Indeed. That's the entire health care problem summed up in 8 words.

[Tennessee_Bob]

Something else that hurts the patients and the costs is the prescribing of the latest and greatest meds. The drug reps are pushing the latest stuff, and there's no mention made (or so it seems) of formulary status, cost, or co-pay for the script.

I think if there was more awareness of the patient's pharmacy plan (and I blame that on the patient, not the doctor) and more concern about the cost of the med to both the patient and their plan, we'd see a reduction in the costs. Of course, once that happened, the drug companies would just adjust their AWP, and make the money back again.

I work for a pharmacy benefits manager, BTW.

[hocndoc]

Thanks for reminding me one of the major reasons why I closed my office.

For Family Doctors, if we don't collect at the time of the visit, the $10 to $30 co-pay can cost more to collect than it's worth. On the other hand, it can really add up.

It's amazing how many people go to the doctor without their wallets.

[markman46]

I always pay what ever the copay is, Yes I do believe that people leave their wallet's at home or in the car. and I work in the industry, but the capped Dr's get that nice monthly check whether they see the patient or not. course when you can only spend 5 Min's on each patient, i suppose that is not a good deal either.

[dawn53]

I worked for an endodontist for many years.

I was always amazed that folks would show up with no money, no credit card, no insurance, and no check.

A root canal can be an emergency, but to waltz in, with no intention of paying and expect the dentist's service was beyond my comprehension. Try going to the register at a local department store with a basket of goods, and saying, I forgot my wallet.

Unfortunately, instead of the old-fashioned way of collecting the money after the work was completed. We had to resort to collecting money before the patient was seated.

[hocndoc]

The only "capped" plan I ever participated in was Medicaid (at $3 per patient per month), since that was the only way possible. I cringed when I heard a colleague say, "They're paying us *not* to see the patient."

I've never figured out a way to spend time I felt was necessary with patients and get paid enough to cover more than the office overhead for the time.

We tried to collect the co-pay before the service for the flat fee plans, but for Medicare, it was harder.

[bonesmccoy]

What the heck do YOU care what I write as a physician?

Furthermore, if I choose to write for a medication with lower dosage, fewer side effects, tastes better, and is less filling; why should an executive working for your company be in a position to lecture a board certified physician about what I'm supposed to prescribe to a patient that I know, I examined, I diagnosed, and should be able to treat as quickly as possible?

[bonesmccoy]

I am also a physician. These capitated contracts are almost universally controlled by a limited board of directors of subspecialists.

You appear to be a family practitioner or internist and are being capitated.

You should know that my research indicates that "sub-specialists" are paid well OVER the RBRVS rate. That means your fees are being usurped by the sub-specialists. In addition, many physician networks are lying about their accounting.

We have reviewed many hospitals (supposedly non-profit) and their associated private physician groups.

In various California counties, including Los Angeles, San Bernardino, Riverside, and San Diego, it is possible for a physician to participate in a Blue Cross of California or Health Net Medi-Care or Medi-Cal contract.

However, in the County of Orange, it is NOT possible for ANY primary care physician to be paid under a fee-for-service system. This totally decouples the services from the patient-physician relationship.

Because the hospital risk pools are so large, there are hospitals with substantial off-shore bank accounts, including one prominent chain with a large fund in Bermuda where 75 million dollars of funds appears to be pooled.

Ironically, while the PCP's are being asked to accept 3.50 per month for a person's life, hospital and physician network executives are being paid millions per year.

Do you belong to a private physician network? If so, which one?

If you are in the State of California, there is a strict Business and Professions Code which clearly states that only Knox-Keene licensed corporations are permitted to manage risk pool funds. However, in many counties across Southern California, there are privately held corporations that are NOT Knox-Keene licensed insurance companies, yet appear to be illegally managing medical/health risk pools.

Please post more... I want to get the word out to Freepers about the abuses in the healthcare system.

These abuses are jacking up the cost of care artificially so that liberal health care executives can pad foreign bank accounts and ruin the freedoms others fought for.

[bonesmccoy]

our group will not permit the patient to be seen unless the co-pay is paid up front. We accept cash, credit card, ATM, checks. We routinely have bounced checks from people.

These costs have added up, but we call the family and ask if we can use a charge card instead. We bill the co-pay and a penalty for bouncing the check (equivalent to the fees imposed by the bank).

[CurlyDave]

Furthermore, if I choose to write for a medication with lower dosage, fewer side effects, tastes better, and is less filling; why should an executive working for your company be in a position to lecture a board certified physician about what I'm supposed to prescribe to a patient that I know, I examined, I diagnosed, and should be able to treat as quickly as possible?

Amen to you. I have had to fight tooth and nail to get the one drug which does not cause excessive side effects in me. I have had to "try" others for months just to prove they didn't work as well, and then every couple of years my employer shuffles us all off to a new plan and we have to start all over again.

I have offered to co-pay more but the damnable insurance company refuses a cost-neutral solution, insisting that they know more about what drug I should take than I or my Dr.

[drlevy88]

You could just eat the whole cost of the Rx. Then the doc can prescribe whatever he or she wants. It's the golden rule, whoever has the gold makes the rules.

[garandgal]

What the heck do YOU care what I write as a physician?

Thank you for that! I have been told several times that my insurance will not pay for a prescription because "WE" (who the heck is WE?) feel that XYZ drug is more appropriate.

First of all, I didn't go to the insurance company to be diagnosed...I went to my DOCTOR; so why is the insurance company involved in deciding which drug is "appropriate"? Secondly, they think we are too stupid to realize that the reason one drug is prescribed over another has more to do with under the table kickbacks than the drug's effectiveness.

Insurance companies are going to be the downfall of the wonderful health care that we have enjoyed in this country. What started out as a nice cost-sharing idea has devolved into a nightmare...due to greed and avarice.

[hocndoc]

Actually, I'm in Texas, and in April, I closed my office (private solo practice - walkin urgent care with some family practice for the last 6 years after 4 years in old fashioned cradle to grave family practice with OB during which I joined 6 other docs in a partnership). I'm not a good business person and the complexity just finally got too much - and my employees started changing jobs for more money but fewer benefits. When what I thought of as my "family" started leaving, I couldn't justify working so hard for so little money.

Now, I'm doing a lot of political work and volunteer testifying and visits to State agencies and hearings. I need and love to be a doctor, so I'm working as a locum tenens with a couple of docs and trying to decide "what I want to be when I grow up." My husband supported us for the last two years while my practice floundered, so I'm taking the opportunity to try to work at changing the things I've griped about for the last 10-15 years.

Those obscene salaries and benefits for the insurance company execs are a pet peeve. How can Dr's fees remain stable for years, when the CEO is making $ 2+ Million a year? (average is $1.74 million salary plus benefits)
http://www.insurancetech.com/utils/printableArticle.jhtml?doc_id=14705473

[hocndoc]

I get calls and letters from my own insurance company suggesting cheaper meds to substitute for what my doctor and I have decided is the best for me. (For restless leg syndrome, they think I should take amytriptiline, for instance. Would you want your family doctor to take this med every night, or how about the driver in the next lane?)

I willingly pay a higher co-pay, but I know many patients can't afford the same, or high co-pays for multiple drugs. But, on the other hand, new, once a day or shorter-course meds are better for the patient's health and the patient is more likely to take them as directed. Most of my decisions are based on the side effects as well as the desired effects. If we harm the patient by our treatment or his treatment is insufficient, the costs will be higher in the long run. And, as low as physician reimbursement is, the extra office visits (or Lord forbid, a hospital stay) will cost much more than the higher-cost drug.

I finally figured out that the way we were trained, with 36 hour shifts and on-call ever 2 or 3 nights, taught us to think differently from nurses, nurse practitioners, physician assistants and insurance bean counters: we think of what could go wrong, what will happen at 2 AM, and the worst that could happen or what will result in a page during dinner or in the middle of the night, and try to plan accordingly.
Insurance companies require doctors to authorize refills and scripts, so why not let us make the diagnosis and treatment plan, as well?

[garandgal]

Just FYI...I live in one of the "insurance capitals" of the country. I noticed an article last week in the business section about executive movement within a particular company...a major group health provider.

Get this...the "executive vice presidents" of departments...not entire divisions...simple departments (as in marketing, advertising, etc.) are making $900,000 per year. I am particulary appalled about the V.P. of marketing...I mean, how hard is HIS job. "Buy our outrageously priced insurance, or your children may die of cancer because you have no coverage." V.P. of extortion would be more appropriate.

[cajungirl]

Doctors are demonized for wanting their patients to be able to not pay a copay in order to decouple the relationship and to serve the financial needs of the insurers. Doctors are thought to be criminals for wanting to prescribe a more expensive drug by implying they do it for some kind of kickback. The above are lies and distortions to deskill the doctor, put the insurer in charge and hurt patients more than they know. It sickens me. And most patients go right along with the lie and the distortion. We are losing something precious here.

[MarkL]

Something else that hurts the patients and the costs is the prescribing of the latest and greatest meds. The drug reps are pushing the latest stuff, and there's no mention made (or so it seems) of formulary status, cost, or co-pay for the script.

However, this is a two way street... Sometimes, the insurance company will only give full coverage to certain, less expensive drugs that, while similar, will not actually take care of the problem...

For instance, my insurance company would cover the generic of Tagamet (Cimetadine), but not Prilosec. I was on Tagamet for over a year to treat an ulcer. The Dr suggested that I try Prilosec. I was on it for 1 month, and I've been free of the ulcer for nearly a year. However, while the cimetadine would only cost me $15 for a month's Rx, the Prilosec cost me $80.

Another terrific example is a treatment for Crohns disease. The medication that my Dr perscribed was Pentasa, which is similar to Sulfasalazine. The problem is where the medication is delivered. Due to my Crohns disease, Sulfasalazine really isn't effective, since it delivers the drug in the stomach, rather than the intestines, which is where Pentasa delivers it. A 30 day supply of sulfasalzine is $15, since it's on the list... A 30 day supply of Pentasa is $115.

While some Drs do perscribe the "latest and greatest" drugs, just because they are newer, in some cases, they just happen to be the right drugs for the condition.

Mark

[MarkL]

You could just eat the whole cost of the Rx. Then the doc can prescribe whatever he or she wants. It's the golden rule, whoever has the gold makes the rules.

There is a contract between the insured and the insurer. If they agreed to perscription coverage, it should be up to the Dr to decide which medication should be perscribed. Often times, the insurance companies will update their list of "approved" medications with no warning, or changing the co-payment mid-term.

It's happened to me on more than one occasion.

Mark