Dr. Kussin: Doctor’s Incomes – Fee for Service or Fleeced for Service

September 21st 2012   ·   0 Comments

By Dr. Steven Z. Kussin, MD, FACP

Suddenly the crowd comes to a sudden stone silence. The air is still; you can hear oxygen atoms colliding. Eyes that are hooded and others that shift about furtively, glance at each other in shock and horror. Faces are frozen. Each face is a mask poised in a rictus of disgust and dismay. A forbidden topic has been raised. Taboo. Those who dare to discuss it are outcasts, outliers and are ushered out the door. What rules, sacred to society were breached, prompting revulsion? Which Commandment was broken? Who dared raise the topic of doctors’ income, our motives and how we make our money?

How We Make Our Money

Doctors’ revenues come from providing medical services to you. Visits, tests and technologies drive our yearly incomes. And those incomes? A recent study puts average high earning specialties at $350K/year.

Yes, most doctors don’t have a share in CT scanners. Most don’t own ambulatory care clinics. Most labs are independent. Most referrals don’t result in telling that specialist, “I’ve scratched your back; so you scratch mine.” Most doctors do not have conflicts of interest brought about by their salaries or speaking fees from drug companies. But cumulatively there are tens of thousands of doctors who have income enhancing arrangements. You will never know who—there is no transparency.

Even doctors on salaries get bonuses for productivity. The more they do, the more they make. Period. The only controversy regarding doctors’ profit motives and conflicts of interest are how to tame them.

Profit-Based Medicine and Conflicts of Interest

Last week I wrote that 30% of medical care is unnecessary, a fact hitting the news in a big way. What drives this excess? Well, I also wrote about defensive medicine. Now lets’ look at profit-based medicine. And no, doctors are not evil. The practice is not venal. We, by and large, are not even cynical. It’s a fact of life for all people who earn their livelihood by piecemeal work.

The following premise is accepted by most, without dispute… “Most doctors, and/or the clinics and hospitals they work for, are paid more if they do more.”

Fee for service is not unique to the medical profession. It was true for the piece-meal laborers in Lower East Side tenements and is still alive at the corner auto garage.

Prioritizing Quantity of Care Over Quality of Care

Doctors’ generous compensation doesn’t rely upon quality of care. Rather it’s quantity that characterizes American “care.” Compared to other industrialized countries, the U.S. pays up to three times the costs for health care. Yet, we still rank low in benchmarks that define a worthy system. More care is not necessarily better care. Much of why American medicine is expensive relates to higher fees paid to specialists, subspecialists and surgeons compared to other industrialized nations.

You pay a lot, but you don’t get a lot.

Profit and Conflicts of Interest Influence Medical Decisions

“A conflict of interest exists when a primary ethical or professional interest clashes with financial self-interest, a situation that arises commonly in medical practice. One study found that more than half of panel members on diabetes and cholesterol guideline committees had conflicts of interest. 11% of those who declared no conflict of interest were found to have 1 or more. Another group found that 56% of 498 writers of 17 major cardiovascular guidelines had financial relationships with industry.”

Profit Motive

“More hospitals are developing heart surgery centers, but new research suggests more catheterization labs lead to more performed heart surgeries, especially when they’re not necessary.”

When it comes to that next surgery, if it involves a medical device… “For better or worse, doctors in this country frequently have financial ties to companies whose devices or drugs they recommend to patients.”

The profit motive is on such full display in imaging technology that it’s now mandatory that doctors disclose ownership of a CT machine and offer a list of other CT offices in town (good luck on that one). So, let’s not be defensive. It ain’t about greed (usually), but the profit incentive is pervasive and irrefutable. Dr. Arnold Relman, an icon in American medicine sums it up… “the root problem in U.S. health care is the primacy of profits over patients.”  And to be fair he’s indicting the entire system of doctors, hospitals, BigPharma, the device industry and for-profit insurance companies.

Is it Greed?

For some of us, it sure is! The dictates of DNA and Darwin, prioritize self interest and in-group relationships.

Many doctors order tests, in part, because it increases their incomes. For some, profit is clearly a conscious act and is against our professional oath. But for the majority it’s actually unconscious. It’s a well known psychological concept. I have adopted it to explain doctors’ incentives and their outward invectives when the ‘money’ enters the conversation. It’s behavior known as “Money Primed.” What is “money primed?” That’s next week.

http://jama.jamanetwork.com/article.aspx?articleid=196871

By Richard