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Saturday, February 27, 2010

21% Cuts: The perfect storm?

If you have had your head in the sand or too immersed in patient care issues, our fearless lesaders have let the Medicare's SGR proceed and with it a 21% cut in Medicare reimbursements to doctors across the board.  Whether you take Medicare or not, no matter what your payer mix may be, this affects you dramatically.  For many, if not most of us, our private payer contracts are tied to Medicare rates.  So  in essence, you can expect a 21% cut in gross payments while the private insurance companies have just recieved a 21% windfall.

Do you have chest pain yet?

How will you survive?

Well, you may not.  This may reresent the perfect storm, the trifecta of bad luck that has befallen the American doctor: rising liaility inurance rates, falling reimbursements, a severe recession. 

Or you could try some of the following:

  1. Stop seeing Medicare patients.  Not out of protest, but because these patients are too sick and labor intensive to care for and still make money.
  2. Increase volume.
  3. Go ou of network with some private plans.  This works better if you are a primary care doctor or a specialist that sees emegency room patients.
  4. Re-negotiate your contractswith the private payers.  Good luck with this one, but you never know.
  5. Merge, merge, merge.  If the other strategies don't work, this drastic move may be the only viable approach. 
Good luck and let me know how it goes.

Dr Schoor