03 Mar Audacity of Reality: Patients must pay for health care
Audacity (ô-dăs’ĭ-tē) n.
- Fearless daring; intrepidity.
- Bold or insolent heedlessness of restraints, as of those imposed by prudence, propriety, or convention.
I read with amusement this article on the idea that doctors have the audacity of to be charging for their services at the time they provide them. Just think about that for a minute – people upset about the fact that they have to pay for a service they receive.
- “How dare the movie theater demand I pay before seeing the movie?”
- “Can you believe I had to actually pay for this suit before they let me wear it home?”
- “Man, the airlines are killing me by asking me to actually pay for my flight before I have actually flown!”
- “My lawyer asked for a retainer before she agreed to take my case – can you believe it?”
Of course, these are absurd notions. So why is health different? Why should we think about it differently than we do anyone of our assets that is valuable enough to warrant financial protection (insurance), active management (you wish you knew what to do with your portfolio), and even a trusted advisor (you wish yours knew what to with your portfolio as well!) to guide you through the decision making process.
The article reveals the fundamental, deep, and pervasive misalignments in how we pay for health care. Highlights are mine:
When Nicole Atkinson, 29, of Baltimore scheduled the first obstetrics appointment of her pregnancy last year, she knew the experience would come with its share of surprises. But Atkinson wasn’t at all prepared for a financial one: a request to pay up her full deductible — $600 — before the doctor would see her for the exam.
“So, I fired her,” says Atkinson, who then switched doctors to one who charged only a co-pay for each visit.
But if Atkinson decides to have another baby, she may not be able to avoid that balloon payment. More and more physicians are asking for the patient’s share of that day’s medical fees, including any deductible set by the insurer, at the time of the visit.
“It’s a paradigm shift from what most consumers are used to at their doctor’s office,” says Red Gillen, a San Francisco-based analyst with consulting firm Celent, who last month published a report on doctors seeking upfront payment from their patients . . . According to Gillen, consumer out-of-pocket spending as a percentage of all health-care spending rose to 12 percent last year, and is expected to continue rising.
A survey published by the Kaiser Family Foundation in September, found that 18 percent of people who responded were covered by insurance plans with deductibles of at least $1,000, up from 12 percent the year before. “Until now,” Gillen says, “insured patients would see a doctor, leave a co-pay and then watch a series of insurance and physician envelopes come through the mail over weeks to months, until finally one detailed the actual amount, if any, to be paid by the patient.” Now, largely through new software programs that assess both a patient’s insurance coverage and the day’s charges, those weeks to months are often collapsed into just minutes for an estimate, or even a full adjudication of the bill.
Owe, say, $90 for a sore throat checkup with at least that amount of a deductible still to be paid, and an increasing number of practices will request $90 that day, plus a co-pay if your insurance includes one.
At one doctor’s office, just blocks from the White House, a video screen in the waiting area tells patients that if they don’t have their insurance card, the practice would be happy to “reschedule your appointment.” That practice also asks that the co-pay be coughed up before the patient sees the doctor and calls patients in arrears to a window in full view — and earshot — of other waiting patients.
Those are more draconian measures than many doctors follow. But few providers let patients head home these days without either some payment or a definitive plan for how to pay their share of the bill.
“This combined information is gathered prior to preregistration and is presented to the patient,” says Faria, who adds that “once a patient has a clear idea of what their coverage will cover and what their cost will be, a meeting with our financial counseling office is arranged.”
Mark Rukavina, executive director of the Access Project, a health-care advocacy group in Boston, says finding out how much patients owe right away, rather than hanging in limbo for weeks to months, is a positive.
One payment option will be a credit card. “It’s a myth that people only use their credit cards for flat-screen TVs,” says Tim Westrich, a research associate who specializes in credit issues at the Center for American Progress, a D.C. think tank. “If you’re already financially stressed, a credit card could be your only pressure valve,” Westrich says.
But some guidance on use of the cards for medical expenses, especially unexpectedly higher ones, could help prevent extra charges and higher interest rates. Rukavina advises patients to never use a credit card that must be paid up monthly unless they are prepared to do so. If they don’t pay on time, a $30 flu shot can cost an extra $30 or so for the late fee, plus trigger higher interest rates.
Celent’s Gillen says that as consumer share of medical expenses increases, he expects banks to issue interest-free health-care-specific credit that might be linked to payrolls for deductions and even offer discounts for users. (Some health-care-only cards exist now but are generally intended for elective health expenses such as Lasik and plastic surgery. They generally start with 0 percent interest but trigger a percentage increase if payment is late or missed.)
Bottom line is we need to transition our health care system to one that pays for value – including patient’s paying for value at the time of service just like they do with their clothes, their TV’s, and their cars. Insurance plays a key role by preventing catastrophic loss but we need to be prepared to pay the maintenance fees on our health assets. We need to save, plan, work toward goals, and be accountable for our health care.
Moving toward a value based health system that competes based on results (instead of zero sum cost shifting gimmicks) will help achieve the audacious goal of creating the next generation health care system.