Survey: Doctors Dropping Out of Medicare

Published May 31, 2016

A new survey of Texas doctors, conducted by the Texas Medical Association, indicates more Lone Star State physicians are severing all ties with the federal Medicare program, possibly as a reaction to anticipated cuts in physician payments.

John Graham, chair of the health care studies department at the Pacific Research Institute in San Francisco, believes the Patient Protection and Affordable Care Act is going to increase the trend of doctors dropping out of Medicare and refusing to treat Medicare-covered patients.

“ObamaCare has really exacerbated this trend,” Graham said. “The data from Texas shows that what doctors are doing there is really in line with the number reports coming from the Mayo Clinic and others showing that doctors are not going to take Medicare patients anymore. I think that the reports from the Texas Medical Association and others probably are actually understating the situation.”

Making a Bad Situation Worse

A similar survey conducted two years ago showed close to half of all Texas doctors were not accepting new patients enrolled in Medicare. Graham believes the root of the problem is President Obama’s health care law further reducing the payments Medicare gives to doctors.

“The Medicare fee schedule is not satisfactory here. This all happened before ObamaCare became law, but ObamaCare did not fix it, instead making the payment situation massively worse, especially for the seniors in the Medicare Advantage program, about five million of whom will be thrown off those plans,” Graham said.

“ObamaCare is going to accelerate this crisis with astonishing and brutal force,” he added.

‘Medicare Meltdown’ Expected

Ed Haislmaier, a senior health care researcher at the Heritage Foundation in Washington, DC, believes the Texas survey confirms a definite trend toward what he calls a Medicare meltdown.

“We have seen the national trend of a decline in the number of physicians accepting new Medicare patients,” Haislmaier said. “You will see the Medicare meltdown in the data—doctors are no longer seeing Medicare patients, a tough decision because doctors generally don’t like to stop seeing somebody on Medicare if they already have a relationship with them as a patient. But it’s what the situation dictates.”

Haislmaier notes this trend could be reversed if Congress gives doctors greater control over what they bill patients for their care.

“There are some ways to forestall a Medicare meltdown. One way is allow for ‘balanced billing’ where the doctor says to the Medicare patient, ‘I need to charge $50, but Medicare is only going to pay me $30; you pay the difference,'” Haislmaier explained. “It’s simplistic, but removing the prohibition on ‘balanced billing’ will probably do it.”

‘Doc Fix’ Bill Called Inadequate

Haislmaier explains Congress’s most recent “Doc Fix” bill, which provides only a temporary solution for the underpayment problem, adds $65 billion to the national debt in ten years and will not change the grim situation.

“The payment adjustments in the Doc Fix bill are probably not going to have that much effect in changing this trend. The Doc Fix bill is about preventing future Medicare payment cuts to doctors, but if doctors are already opting out, it will not have much effect,” Haislmaier said. “Without a permanent fix, they’ll stay out of the system.”

Medicare Gains Medicaid’s Problems

Haislmaier maintains the meltdown situation is also being driven by geography because the federal government’s payment rates to doctors in Medicare vary by region with little rhyme or reason behind the price differences.

“Medicare payment rates to doctors vary by geographic region and are mismatched: Medicare does not pay the going market price. Medicare will have a hard time finding a doctor, and a decline in access to care,” Haislmaier said.

Haislmaier says if doctors are not allowed greater freedom to decide what they charge for care, Medicare will only get worse.

“Soon, Medicare will start looking like Medicaid. With no extra federal government money available to increase what the government pays to doctors, because America just got this entire new and expensive entitlement on top of a rash of stimulus and bailout spending, federal and state governments’ fiscal armageddon will be a contributing factor to the Medicare meltdown.” Haislmaier said.

Thomas Cheplick ([email protected]) writes from Cambridge, Massachusetts.