Career and Life Planning Guidebook for Medical Residents

Market Driven HealthCare Understanding Market Conditions & Healthcare Reform Like caring for a critically ill patient, market con- ditions and the healthcare industry will continue to change at an often unpredictable and rapid pace. It’s important to keep the following in mind when assessing these fields: Rapid change will continue to be constant. Stay as informed as possible. Conduct your own research. Surround yourself with positive people. Remember to look for the “silver lining” in every challenge. Don’t fall prey to negativity you may hear and experience from other doctors. Reduction in Medicare Payment Rates Continues In general, hospitals continue to receive lower reimbursements across all payers. Immediate challenges are maximizing efficiency and elim- inating waste in care delivery systems to maintain operating revenue and credit rating. They must position themselves to accept bundled payments and risk-based payments. With regard to insurance, changes in managed care, rising medical costs, and government reg- ulations will no doubt impact insurance costs as well. In the short term, Medicare patients may find fewer doctors willing to accept them. In the longer term, payments will likely level out, and physicians will need as many patients as they can get, so fewer will be turned down based on insurance/payment levels. In 2015, Congress repealed the Sustainable Growth Rate (SGR), which determined physician reimbursement. The SGR was designed to counter the tendency toward spending growth driven by the fee-for-service model that rewards volume and intensity. It automatically reduced Medicare physician fees if physician spending exceeded a target based on overall economic growth. But it was a flawed formula that served as an impediment to payment reform. The volume-based cuts to fees under the SGR have been replaced with modest annual updates instead, usually about 0.5%. The 2019 reimbursement levels will remain in place through 2025, but high-performing providers and those in alternative payment models such as ACOs will have the opportunity for additional payments.4 Oh - One More Thing… The ACA has not yet shown much movement in reducing the overall costs of care and the enormous investment our society makes in healthcare as a percentage of GDP (primarily because the majority of the payment system is still within fee-for-service, and care delivery transformation takes time). Thus, there is an increasing effort to move healthcare payment reform toward a single-payer system, or some interpretation of “Medicare for All.” This is obviously very politically contentious. Some politicians are still trying to repeal the ACA, while others are trying to findways of strengthening it. The future healthcare payment landscape is currently a very grey area! Overall Impact on Physicians What do doctors stand to gain or lose in all of this? As people in a caring profession, many doctors are either truly or theoretically happy that about 20 million more Americans have health insurance. Yet physicians have every right to be concerned about their own livelihoods and medical practices. For some doctors, the healthcare bill will create benefits 99 WWW.PHYSICIANCAREERPLANNING.COM