Last night, my family and I became the proud owners of a shelter cat. He’s a (roughly) 8-year-old tabby named Mike. In the 12+ hours we’ve owned him, my first instinct is to change his name to Elmer, as this cat is glued to any human that enters the room. He has already gotten very comfortable with head-butting my arm as I try to operate a mouse on my home office desk. I also learned very quickly this morning that eating and checking e-mail to start my day may require three arms from this day forward.
There is one very clear ill effect thus far to this sudden change in my home population, and that would be the effect Mike is having on Rocky, the family dog. Rocky is very much my wife’s protector, and visual contact with her must be maintained at all times. When this isn’t maintained, Rocky begins to shake, whine and pace back and forth. To introduce Mike to the home, we’re starting him out in one room of the house. When my wife disappears into that room, closing the door behind her, Rocky takes this behavior to a new and as-yet undiscovered height. It was hard for me to believe this morning that this squealing and cowering nervous wreck is the same dog who boldly and aggressively barks at the mailman every day.
For both human and canine, sudden and abrupt change can be a time of upset and discomfort. In the health care arena, as the dust settles in the days and weeks after the passage of the Patient Protection and Affordable Health Care Act, we have all been internalizing information contained in the law and how it affects every facet of the health care delivery system. Knowing this, it’s important to know what the heavy hitters in the industry (namely insurance companies and doctors) have begun to put in place to prepare for the bulk of the changes that will hit in 4 years.
In looking at the insurance industry, it is important to remember that every one of them has a team of lawyers that are more than happy to dissect any law to see how the words on the printed page can be manipulated in favor of the company and its stockholders.
The industry already gave itself a gift with the portion of the law which mandates coverage for all who can afford it. After Medicare Part D was passed in 2003, the insurance industry used Medicare drug coverage as a golden opportunity to expand its reach into the federal health insurance plan by using their drug plans as a selling point for Medicare Advantage plans. In many cases, industry practice was comparable to the long-distance telephone slamming that went on in the 1990’s, with people not realizing what product they had until the first bill came in the mail.
The new law mandates that insurance companies who offer Medicare Advantage plans must put in place provider networks for the plans by 2011. Some of the bigger insurance companies with Medicare Advantage plans have begun to answer this mandate by pulling out of the Medicare Private Fee For Service market altogether rather than going through the expense of building a provider network. It’s a calculation that ceasing coverage for a portion of the older population which tends to use medical resources more often will lead to a healthier bottom line when compared to the cost of building a provider network. With the post-World War II baby boomers beginning to turn 65, and with average life expectancy in the mid to late seventies depending on gender, saying goodbye to such a large portion of the market would appear to be a long-term financial gamble akin to what banks did prior to the mortgage bubble bursting. In the short term, the discomfort of change will be placed upon those currently covered under a Medicare PFFS plan that terminates at the end of the year. All this time, I thought the Scorched Earth Policy officially ended with Napolean’s ill-conceived invasion of Russia. It looks like I got that one wrong.
The AMA issued a press release shortly after the passage of the law attempting to draw attention to the financial benefits to physicians. While it’s good to maintain a positive attitude in times of change, it is a good time to note that 5 days from now, without a legislative fix, Medicare payment rates will fall 21.3% for all services after April 1st. As in the past, a temporary fix is expected, yet an opinion is beginning to develop in the physician community that without a permanent fix to the Sustainable Growth Rate (SGR) formula for calculating physician payments, the world of health care delivery for the elderly American will suddenly be a narrow and unfriendly place.
Change brings anxiety. From a multi-billion insurance company to the family dog, long-held routines bring comfort and a sense of security. Due to the new reform law, the business of health care finds itself on the precipice of a pit obscured by clouds. Whether the distance below these clouds is 5 feet or 5,000, it is in the preparation for either eventuality of the leap that determines the jumper’s fate.