Tag: rant

Financial parasites in the healthcare world

Financial parasites in the healthcare world

Healthcare is big business, with medical practices vying for contracts, hospitals undergoing facelifts in order to cater to patient experiences, and insurance companies making deals with pharmacies.  Some of these arrangements are negotiated in the name of reducing healthcare spending, but there has to be some skepticism when for-profit entities are implicated.  Physician salaries aren’t exactly growing with inflation—some fields have had massive cuts in spending over the years too.

The problem with these stagnant and reductions in physician salaries are that they are targeted in the name of curbing healthcare costs since there are no more dollars to be distributed in the system.  All the while, the number of administrators and middlemen/women in the system consume more healthcare dollars.  Yes, this may be an oversimplification of the problem, but I’ve seen hospitals hire minders to explicitly observe whether a healthcare worker uses hand sanitizer in front of a patient!  Talk about waste in healthcare dollars!  When you slash the compensation of the people on the ground while making them do more work, there will undoubtedly be unrest.

From fast food to healthcare
Just as how a successful fast-food business such as McDonalds relies on its workers to function, healthcare relies on doctors, nurses, and allied health workers to run.  However, this is just about where the similarities end. In the fast food industry, these workers are entry-level employees that keep the ship running.  One could argue that this industry takes advantage of the labor to pad its shareholder profits and administrators’ pockets.  This industry also provides a means for someone to earn income.  If the employee does not like the management, she could simply leave and find another occupation.  If this person wanted to open her own franchise or establishment, she could do so (yes it wouldn’t be easy but possible).  There is no particular skillset that ties down the fast food worker to the business.
Unfortunately physicians aren’t all able to do the same for a number of obvious reasons.  Many medical specialties are bound to hospital care, simply due to the subspecialization of their trade.  Intensivists, for instance, have specialized training for care that can only be delivered in an intensive care unit.  Other specialists who have traditionally been able to practice medicine on their own are more restricted today by insurance contract limitations and high costs of startup.  The amount of student debt that many younger doctors have makes it challenging to take out loans to start their own medical practice.  Hence, many physicians are stuck laboring away to supply jobs for many other healthcare workers.

Golden handcuffs
I’m not sure what to think about how my labor supports the jobs of dozens of healthcare workers.  Are these workers all needed for you to do your job? How much of that other person’s salary could be going into your pocket? How much of healthcare dollars could be saved if you weren’t required to have a certain number of staff under your name?  Let’s look at a real example:

Take, for instance, the number of supporting staff for a moderate volume ophthalmologist.  Her clinic has three technicians dedicated to her, along with shared front desk and ancillary staff.  The local ambulatory surgical center has an equivalent of 1.0 FTE scrub tech and circulator essentially dedicated to this surgeon.  There is also a CRNA who generates a third of her weekly salary from that surgeon.  This amounts to essentially 4.3 FTE plus front desk that is feeding from a single doctor!

Mutualism, commensalism, or parasitism?

This amounts to $210,000 of additional healthcare dollars used, feeding over four full-time workers!  The bigger question is whether these workers are needed in order to deliver care in the system.  How much would one fewer office technician impact productivity?  Would a decrease in a $55,000 salary reduce overall revenue by $70,000 but improve the sanity of the doctor by a tenfold?  Is the doctor mandated to have this set number of support staff by the medical practice? 
The predicament that many doctors face is that they are not able to exit the system.  Their skills are tied to an inefficient system.  If they were to leave, most other options are likely similar to the system that they sought to escape. 

How many financial parasites do you have in the workplace?

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Having insurance doesn’t mean healthcare is free

having health insurance doesnt mean free healthcareOne of my pet peeves is simply the complex healthcare system that I knowingly work in. Hypocritical, yes. What is unfortunate and frustrating is that the majority of our patients don’t really understand how the system works, and assume that doctors are making a killing off of the healthcare system. Doctors, too, are mostly unaware of how the healthcare system works.  If doctors knew exactly how the system worked and learned to save their earnings, then there wouldn’t be as much of a need for physician financial education. Case in point:


The bill that your insurance company mails you does not reflect your doctor’s income.

This is the number one deceit. Your patient sees you in the office, and the insurance company sends her a statement of performed procedures and charges made. The charges on the bill absolutely do NOT indicate the amount that your doctor receives from the insurance company. In fact, I have had instances where the insurance company actually denied my claims, sent my patient a billing statement of charges, and have a patient comment on “how much I made on her 25 minute patient visit”. Disgusting. I didn’t even get paid for taking care of a patient, and my patient thinks I got paid a ton for her visit. So much for altruism.


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The copay also does not reflect how much a doctor is paid.

Another one of my patients commented that her copay went up to $50 per visit from last year, and that she hopes that “I am getting a good raise” now that I’ve raised my copayment charges. Score one for the insurance carriers. They’ve successfully convinced the public that higher copays equate to more money to the doctors.


Having health insurance doesn’t mean that you never have to pay for care.

A common patient complaint I receive is that they are upset that the insurance company did not pay for all of the care. That is the definition of a deductible! One of my colleagues complained to me that one of his patients basically received a free knee replacement because he refused to pay for any of the deductible for the surgery, and was not willing to pay for any of the postoperative medications. My colleague still had to see the patient for all of the postoperative care. It was okay, because the patient was sporting a new Apple Watch and iPad Pro in the waiting room.

You can still win the lifestyle and financial game even in medicine.

Despite the skepticism and cynicism with how broken our healthcare system is, we can still win the game. Remember, we entered this profession to care for patients. No matter how misguided our patients are with how the healthcare system works, we can still deliver great care to them and earn a decent living out of it. Here’s how to do it:

  1. Win the lifestyle game. Find a way to carve out a four-day workweek. Maximize your productivity while you are at the hospital, and minimize the amount of work that you take home. Know your value, and grow your value. Prevent your obsolescence to avoid getting fired.
  2. Win the financial game. Save more than you earn. Hustle to increase your income. Learn to become a successful doctor. Generate your income stream and work hard.

What other strategies have your implemented to win the financial and lifestyle game?

(Photo courtesy of Ubi Desperare Nescio)

Doctors are not paid enough for their services

There has been a public belief for decades that doctors are among the wealthiest in the country, and that they are overpaid for their services. Those who care to pay attention to the evolution of the health system are also aware that payments for physician services have progressively slashed by insurers.

That being said, the majority of my patients still have a poor understanding about how doctors are paid and the work that goes into being a healthcare provider. I have overheard comments from patients that go along the lines of this:

“These doctors spend less than 10 minutes with me and I get hit with a bill for a few hundred dollars. They have it all good.”

“She always wears such fancy clothes. Docs have so much money.”

“I work just as hard as this doc. Why does she get paid so much more than me?”

While this is just a slice of what I’ve only heard, it is clear that much of this stems of ignorance. I will analyze the topics to clear the air:

1. What you see on your bill is not what your doctor gets to keep. For instance, you may see what your doctor billed your insurance company $300 for your care. In a fee-for-service model, the contracted rate may only be $130. The billing company may then take another 3-5% for its services in helping the doctor collect from the insurance company. If the doctor is unlucky, the insurance company may even deny/reject a claim due to documentation issues and get nothing. After everything is done, the practice collects maybe $125. That amount goes toward paying for the clinic’s utilities, front desk person, technician, computer systems, diagnostic equipment, cleaning services, and all other costs relating to operating the clinic. I’ve seen practices with operational costs in the 90+% range. If your doctor is employed by the practice, another cut may be taken out by the practice owners. Maybe if your doctor is reimbursed more appropriately, then she might actually have more time to spend with you.

2. While it is your doctor’s own business what she wears to work, would you consider your doctor to be less competent if she were disheveled and wore dirty clothes? What if the fancy-appearing clothing were actually purchased third-hand at a thrift shop? I have certainly had patients with life-threatening medical conditions who refused to pay the $20 copay but was willing to own fancy iPhones, Ray-Ban sunglasses, bling, or even get $100 massages. Ultimately it all lies in where your priorities are.

3. There are very few good paying occupations that aren’t challenging in some form (physical or mental). As a plumber I can bill for $100 an hour and even include the time it takes me to find a part that I need in the store (and I can charge you for the part). The 30 seconds of medical decision making that a doctor undergoes took many years (a decade) of sacrifices to learn. Even after making that decision, there are still ramifications that has to be considered. It doesn’t end. Obviously there is a price placed on a doctor’s ability. There’s also a fine line to what a doctor is worth. What should be known is that if that value of a doctor is discounted enough, those who are most competent will quit.

Comments? Questions? Sound out below!

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