Congress agrees with physicians that S.G.R. is seriously flawed. The House Energy and
Commerce Committee is starting to mark up the repeal of the S.R.G formula. It
is going to replace it with a 0.5% yearly increase in physician reimbursement
until 2018. In 2019 the government will link Medicare payment to the quality of
care each physician provides.
The malpractice issue of defensive
medicine and over testing is real. The Massachusetts Medical Society survey of
defensive medicine is real. Most physicians in Massachusetts are
liberal/progressive and so the sample is not biased toward conservatives.
percentage of healthcare costs is even greater when the Massachusetts
Medical Society survey is taken into account. The amount spent for
defensive medicine can be extrapolated to actual costs from this survey.
written a series of blogs analyzing the impact Massachusetts Medical Society’s
survey. The extrapolated costs turn out to be about $700 billion dollars a
year. The real cost of defensive medicine is somewhere between $242 and $700
billion dollars a year.
year, 25% of practicing physicians are sued. 90% of physician sued are found
innocent. The average defense cost is $100,000. This cost is not included in
the CBO scoring
fear of lawsuits causes most doctors to practice "defensive medicine"
as the interviews of Massachusetts physicians points out. The result is
unnecessary testing, referrals, and procedures to protect themselves from
allegations of medical negligence.
recent survey of doctors published in the Journal of the American Medical
Association found that 93% of physicians admit to practicing defensive
medicine. A 2008 survey by the Massachusetts Medical Society found that about
25 % of medical procedures are defensive in nature.
waste results in increased healthcare insurance premiums. The premium increases
result in an increase of at least 3 million uninsured people per year. When
these uninsured people get sick they avoid going to a physician. This results
in a decrease in work productivity. It is estimated that the annual decrease in
productivity is more than $40 billion dollars a year.
states where tort reform has been instituted by placing caps on so-called
non-economic damages, the malpractice costs have decreased 39%. This drop in
costs is a result of decreased malpractice suits. The decrease is economically
bad for the plaintiff attorneys. Annual malpractice premiums have gone down at
least 13%. In fact, the medical malpractice business for plaintiff attorneys
has about dried up in Texas.
Dr. Emanuel and the
administration want to connect the leverage they have with the SGR formula to
getting physicians to accept a bundled rate for treating a patient.
Dr. Emanuel “would tie an
S.G.R. repeal to a slow reduction in fee-for-service payments to those
physicians who do not switch to bundled payments and other payment models.”
In other words, accept risk
for treatment that an insurance company would normally accept risk for while
ignoring the malpractice implications of missing a diagnosis or not seeing a
patient at appropriate intervals.
Isn’t the government going
to test physician’s treatment with 88,000 codes in ICM -10 and the Enhanced
Quality Reporting System?
Isn’t the government going
to force the decisions of the Independent Physician Advisory Board on
Now the government wants to
force physicians to accept the potential liability for not using their medical
This is not aligning physician
incentives with efficient treatment cost. It is dictating medical treatment to
Physicians are getting
tired of all of this. They are about to quit treating Medicare patients.
The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone