The problem with a market is that people will work rationally. If the business model is untenable, then the business will fold.
What most health planners do not realise that primary care and private practice of medicien (and medicare uses the US private system are small businesses. If they cannot make a profit, the doc will go elsewhere.
In Texas, the docs are thinking of opting out. Me? I’m an academic, on a salary. My private work is limited to consults: I do not live in an insurance driven jurisdiction (which is what the US has become). But… my Dad waited a year for his bypass. On the urgent list. That is the hidden cost of socailising health.
Congress would overturn the cuts, but their short-term fixes didn't keep up with inflation. The Texas Medical Association says the cumulative effect since 2001 already amounts to an inflation-adjusted cut of 20.9 percent. In 2001, doctors receiving a $1,000 Medicare payment made roughly $410, after taking out operating expenses. In 2010, they'll net $290. If the scheduled 21.2 percent cut goes through, they'd net $72, effectively an 83 percent cut since 2001.
The issue caused the Texas Medical Association to break ranks with the American Medical Association and oppose health care reform efforts throughout 2009. Then TMA President Dr. William Fleming said “reform is doomed to failure” without Medicare reform and called Congress' failure to devise a rational payment plan “an insult to seniors, people with disabilities and military families.”
No surprise to senator
U.S. Sen. John Cornyn, R-Texas, said he isn't surprised by the new opt-out numbers, allowing that Congress' inability to reform Medicare is leaving “seniors without access and breaking the promise we made to them.”
“The problem has been how to eliminate the cuts without running up the deficit,” said Cornyn, responding to blame U.S. Rep. Gene Green, D-Houston, placed on the Senate for not passing a House bill that would have provided a longer-term Medicare fix. “There hasn't been the political will, but we really have no choice but to fix it.”
Cornyn acknowledged the task is daunting. The Congressional Budget Office recently estimated that eliminating scheduled Medicare payment cuts through 2020 would cost $276 billion.
The growth in Texas Medicare opt-outs began in earnest in 2007, when 70 doctors notified Trailblazer Health Enterprises, the state's Medicare carrier, they would no longer participate, up from seven in 2006. The numbers jumped to 151 in 2008, fell back to 135 in 2009 and are on pace for 200 in 2010. From 1998 to 2002, by contrast, no more than three a year opted out.
Now, according to a Texas Medical Association new poll, more than four in 10 doctors are considering the move.
“I've been in practice 24 years, and a lot of my patients got old right along with me,” Culpepper said. “It's stressful to tell them you're leaving Medicare and they're responsible for payments if they want to stay with you. You feel like you're abandoning them.”
via Texas doctors fleeing Medicare in droves | Houston & Texas News | Chron.com – Houston Chronicle.
Hat tip to Mish
