Rajiv Chandra decided that HMOs were not in the best interests of his practice or his patients.
Instead, Chandra, a cardiologist practicing in Melbourne, Fla., decided to take his chances without the guaranteed patients and income that HMOs can bring.
“It’s a conflict of interest,” says Chandra. “HMOs create a conflict between the financial interests of the doctor and the interests of their patients. I accept only fee-for-service. It was a business decision and I think capitation is unethical.”
HMOs typically pay doctors through capitation: Doctors receive a set amount of money each month for each patient. The less money spent on each patient, the more money that is left over as profit for the doctor.
From a business perspective, Chandra simply did the math. In most areas, managed care penetration may range from 40 to 60 percent. If 40 percent of the patients are in managed care, then 60 percent are not, but 80 percent of the providers are on the managed care list. This results in 80 percent of the doctors fighting for 40 percent of the patients.
“From a business standpoint, it was wise not to join,” says Chandra. “My volume has actually increased.”
While some doctors insist that it is possible to do both managed care and fee-for-service at the same time, Chandra says — and studies back this up — that once about 20 percent of the total patient load is in managed care, all the patients start to be treated as if they were in managed care, regardless of how they’re actually paying.
Chandra says he accepts some PPO patients on referrals, but tries to convince them to go to a fee-for-service basis.
“Managed care has changed the ways doctors care for their patients with these financial incentives,” says Chandra. “If you don’t have the money for something, then at least it is up to you to make the decision to do something cheaper. My job is to recommend the best test for a situation, or the best way to diagnose a problem. Managed care tries to change my mind as to what I recommend or can refer. It’s a lose-lose situation.
“There is a constant micromanagement of your decisions. There is constantly someone on the other end that has no concept of the business. These are typically young people, 20 to 25 years old, with no experience with illness, telling you what to do.”
Chandra has nine years of medical training and 14 years in practice, but with an HMO, he would have to get approval from someone looking at a script or other list of acceptable treatments. In some cases, a treatment or condition might have more than one name. If the doctor requesting approval doesn’t use the correct term, it might be denied because the person on the phone doesn’t understand that what the doctor recommended is the same thing that’s on the list in front of them.
While an actual doctor may oversee these people, it can take time to contact them. In one case, Chandra had an emergency in which a woman had chest pains. He called the woman’s HMO in Massachusetts to request approval for treatment, but the person at the HMO didn’t understand the condition. He requested to speak to the medical doctor in charge, but by the time he called back, Chandra had already performed emergency surgery.
What Chandra says is disturbing to him is the loss of understanding and personal care that managed care has brought to his profession. Too many patients have become another line on the balance sheet. But it’s this very thing that opens up an opportunity for young doctors looking to establish themselves.
“They think the only way to build a practice is to join an HMO, but once you are in, it’s tough to get out,” says Chandra. “You have to have strong interpersonal skills — a skill no one else has that will be out there.”
Chandra says it will tough for young doctors to do what he has done — shun managed care. And as older doctors retire, all that will be left are the ones who came up through the managed care system at every level.
“They will have known nothing else,” he says. “I’m concerned about the level of care in this country. Doctors are being schooled on the bottom line rather than how to care for their patients.
“People need to remember that before World War II, medical care in this country was not the greatest. All the richest people flew to Europe for treatment, and the best schools were abroad. America created a shining example of what medical care could be, but this is disappearing. All of these skills should have been passed down in a mentoring process, but managed care has put in a block to this.
“Now, it’s all about medical necessity and cost effectiveness.”
Todd Shryock ([email protected]) is SBN’s special reports editor.
