Doctors and Nurses
How Should Your Doctor Be Paid? Part 2: Episodes of Care
Published January 31, 2009 @ 09:30AM PT
We’ve had some great discussion in the comments on Part 1, so if you haven’t seen it yet, I’d suggest going back and taking a look.
The presidential campaign of 2008 wasn’t that long ago, and one of the areas of health care that John McCain reliably talked about was paying doctors based on “outcomes,” though he was never specific on quite what he meant by that. Barack Obama also campaigned on “aligning incentives for excellence” – again, a little hazy on what that meant or how you get there. To patients, these seem unobjectionable because they fit in the mindset of “I got better, so my doctor should get paid.” However, it scares the bejeesus out of the doctors I know. If their pay entirely shifted to an analysis of whether the patient got better, they’d be at the mercy of the patient following instructions. The nightmare looming in their mind is the patient who is overweight, with high blood pressure and warning-sign cholesterol levels, who irregularly takes his pills and makes no serious effort to change lifestyle. Their compensation would be very poor indeed – through no fault of their own.
In the 1970s, we were wrestling with the same questions. An alternate method to fee for service that some began using them was “capitation” payments. The doctor or hospital would get a lump sum per patient per year. There’d be a financial incentive to keep the patient healthy – if the patient only needed to come in once or twice per year for preventative care, you’d have money left over at the end of the year, which became your profit. This was the model behind the HMO. Unfortunately, the money again trumped patient care as a consideration. Capitation directly led to the HMOs’ reputation as likely to seemingly arbitrarily deny or restrict care, as well as helped accelerate the process of “cherry picking” healthy customers who you knew you wouldn’t use the whole lump sum on each year.
How Should Your Doctor Be Paid? Part 1: Fee for Service
Published January 30, 2009 @ 04:31PM PT

The question of how physicians, nurses, hospitals and other health care workers should be compensated for health care has been cut-and-dried for most of the history of modern medicine. Doctors were paid a fee for a service. Need to get a broken arm set in a cast? That costs X. Need to have a mole removed? That costs Y. But despite the hallowed glint of tradition and custom, the times have clearly changed. We can't ignore the unintended negative consequences of fee-for-service in our Monopoly Money health care system, and we’ve been confronted with too many other competing ideas on how to pay for health care. As we push to overhaul our system, it’s worth taking a second to realize the answer to this question is, “We’re honestly not sure anymore.”
Fee-for-service makes sense on a gut instinct level. I go to my doctor for something – a physical, an X-Ray, a prescription. It makes sense to pay for health care like I was purchasing anything else. But under harsher scrutiny, that analogy breaks down. After all, when I buy almost anything else, I look for the price first. Not so with health care. Instead, I know I'm paying a co-pay which usually has little connection to the cost of my care, and my health insurance company pays for a fraction (hopefully a large one!) of the rest. In the event that they don't, I either fight with them in a costly battle, pay the difference myself or my doctor eats the expense. But suffice to say, that's not in my mind before I go to the doctor's (although perhaps it should be.) In 32 years when I’m on Medicare (and believe you me, I’m getting’ there, baby!), I’ll similarly be shielded from most of the costs of my care. As a consumer, it turns out I’m not really focused on what my care is. My main concern is just, “Will this make me better?”
But fee-for-service doesn’t take into account whether it actually makes me better. Whether the “service” was successful or not, the doctor or the hospital gets the same “fee.” Ditto whether the “service” is necessary or not – as the Dartmouth College study reminds us we spend $700 billion each year on care that does not improve our health outcomes. If you and I have the same condition, but my doctor needed to run two additional tests and an MRI on me “just to be sure” before he could diagnose me, my care will cost more than yours and with no better outcome. If I somehow wheedle my doctor into writing me a prescription for some drugs that he doesn't believe will actually help my outcome, but does it anyway to shut me up, my care still costs more but for no better outcome. It turns out my main criteria as a “health care consumer” doesn’t actually relate to the compensation that will be made in my name.
Defensive Medicine: The Truth Is Out There
Published January 23, 2009 @ 04:06PM PT
You wouldn’t think that “defensive medicine” would be so existentialist a question. But constantly, we pose the question as to whether it exists – as though it were Bigfoot, little green aliens or any other paranormal activity tracked down by Scully and Mulder with serious faces and dire consequences. The latest entry comes from blogger White Coat, an Emergency Room doctor. He’s got great personal stories that yes, physicians practice defensive medicine all the time. But he also demonstrates that we’re asking the wrong questions.
White Coat posts about an average day in the E.R. and gives a number of examples where his instincts told him he didn’t need to perform an extra test, but the patient or a niggling fear of an unlikely secondary ailment caused him to order the test anyway. I highly recommend the whole thing, but this exchange is pretty typical:
A patient came in after being hit on the wrist with a metal bar at work several days ago. The back of his wrist was swollen. From his clinical examination, it appeared that the swelling was a ganglion cyst, but there was also some pain beneath the cyst. He mentioned several times that his boss wanted him to get an x-ray. So I did a wrist x-ray to “make sure” that there was no fracture. There wasn’t. Then I used a modified “Bible technique” (i.e. I used both of my thumbs to apply sudden pressure) to rupture the cyst. Problem solved.
The doctor has a pretty clear indication of what the problem was but ordered an extra test “to make sure,” usually at an instigation of the patient or someone with the patient (ranging from the aggressive nurse daughter who called the administrator when initially told her mother didn’t need an X-Ray, to the overly helpful “little bitties” claiming the likely inebriated patient had a heart problem that needed to be checked). In each case, White Coat says, “I was getting annoyed with myself because I kept second-guessing my decisions to order tests that would most likely be normal.”
HR 676: An Incomplete Grade
Published January 19, 2009 @ 12:17PM PT
So keep in mind as you read the following that I just devoted over 2,100 to the positive side of HR 676. But I don’t have blind love for it. It’s the most credible path towards an American single-payer system that we’ve seen, but it’s not a cure-all.
Going back to my original principles for universal health care, HR 676 takes care of access, no problem. But there are still questions about cost savings, physician supply, dealing with the economic realities of putting the insurance companies out of business, and determining quality that are sketchily answered in some cases, not at all answered in others.
None of these issues are unsolvable. But all of them will need to be considered – and perhaps worked into the bill – before HR 676 can get a grade other than “incomplete” on providing quality health care for every American.
The VA: “The Greatest Story Never Told”
Published January 11, 2009 @ 07:19PM PT
I owe new reader Rose Adwell (welcome Rose!) a big thank you. She asks this question in the intro post on health care issues: “The VA, isn't that a very poorly run system? It would be a tragedy if we ended up with that kind of care.”
I owe her this thank you because I’ve been dying to talk about the health care system for America’s veterans, as administered by VA hospitals, clinics and nursing homes around the country. Perhaps 20 years ago, the answer to Rose’s question would have been yes. But today, after a complete overhaul in the mid 1990s, the VA is far from a very poorly run system. It represents, with no exaggeration, the best health care system currently operating in the United States of America.
That statement may be shocking to some because usually veterans affairs only gets talked about when gross injustice occurs – like the transitional housing situation at Walter Reed. It may be shocking for others because you just haven’t heard anything about it – after all the VA only treats 5.5 million people, including veterans and their dependents, nationwide. But behind many of the principles of progressive health care reform, you’ll find a successful case study as implanted in the VA reforms. We would be lucky if we ended up with that kind of care.
Let me be clear – having the best system doesn’t mean that each hospital automatically is the equivalent of the Mayo Clinic. There are variances in care from hospital to hospital, just as not every doctor is guaranteed to be a medical super-genius.
Call me old-fashioned, but I think you determine the best system by the best health outcomes – does it make patients better, and does it do so efficiently? In 2003, the New England Journal of Medicine crunched the numbers, comparing Medicare and the VA on a broad range of health indicators, from preventative care to chronic care to inpatient care to outpatient care. By 2000, the VA had better indicators than Medicare in 12 of 13 categories.
Where in the World Can We Find More Primary Care Physicians?
Published January 05, 2009 @ 02:20PM PT
Apparently I’m not the only one with Neil Diamond’s “Coming to America” stuck in my head. Jacob Goldstein of WSJ’s Health Blog writes about the very real possibility that Canada would lose primary care doctors to the United States if universal health care is enacted – a big concern for the Canadians. He also refers back to an earlier post about how the number of residency slots in primary care has fallen at the same time as the number of international doctors filling those slots has shot up.
Give me your tired pediatricians, your poor family practice doctors, your huddled masses of internal medicine MDs yearning to breathe free! No, seriously. Give them to me. Because if we achieve universal health care, the demand will go through the roof.
Most economic models suggest that the uninsured use health care at about half the rate that the insured do -- and then equal to that rate when they get coverage. One area that automatically gets axed when you don’t have coverage is primary care. What happens when you finally get coverage? You want to choose your own doctor and get yourself checked out. Sure enough, that’s what happened when Massachusetts phased in its universal health care plan – the already high demand for primary care physicians far exceeded what was available. What good is universal access if you can’t actually see a doctor?
This is one area where bringing in doctors from other countries can only help so much. The incentives for American medical students to become a primary doctor just aren’t what they used to be. You have to see more patients, work longer hours, and get paid substantially less than specialties like dermatology, radiology or anesthesiology. As KevinMD points out, we’re seeing a similar trend with surgeons – the number of general surgeons is on the decline, but the number of cosmetic surgeons is doing fine. We can’t ignore that economics plays as large a role as lifestyle, with the New England Journal of Medicine reporting that reporting that 23% of medical school graduates carry a debt burden of $200,000 or more.
We know what ails us. We need to expand programs like the National Health Service Corps, we need to find better compensation and more support for primary care physicians, we need to fund and train more nurse practitioners and physician assistants who can pick up the primary care slack, and we need to train up-and-coming medical students on how to integrate their practice of medicines with NPs and PAs. And we need to do it yesterday -- because giving all Americans the means to afford health care in the next two years is useless if we don’t have create enough doctors and nurses to dispense the care now.
(Photo credit: Brian Auer on Flickr.)
Nurse Practitioners: Show Them the Money!
Published January 01, 2009 @ 07:34AM PT
The role of nurse practitioners isn't controversial. With more demand for primary care physicians that we can currently meet (and the potential for a tsunami if we can find a way to give health care coverage to 16 million people left out by the system) and with the stress on emergency rooms so bad that “diversions” – waving off incoming ambulances from the nearest emergency room because it’s at capacity – are all-too-frequent, nurse practitioners are needed more than ever. When you don’t have enough doctors to go around, using a nurse practitioner to handle triage, tests, diagnosis, physical examinations, and comparatively simple procedures is a no-brainer.
The recipe is simple: take a nurse, who’s already familiar with patients, how a hospital works, and being part of a medical team. Add a Master Degree’s worth of training in diagnosis and additional medical training. Have them be Board-certified through an accredited nurse’s board. Then set them loose in a practice or emergency room to handle the stuff that doesn’t require a full MD to competently treat. Watch the cream rise to the top.
In most surveys, patient satisfaction with their primary care being handled by nurse practitioners is equal to that of doctors, if not above. Nurses who want to go through the extra training get to utilize all their talents and intelligence. Because a nurse practitioner is making significantly less than an attending physician, the bean counters in the hospital are happy, too.
So why are so many of them feeling like they’re about to channel their inner Keyshawn Johnson and scream, “Throw me the damn ball”?
















