Doctors Going Broke

Doctors are leaving the profession, claiming bankruptcy, and/or ceasing to see Medicare patients due mainly to declining reimbursements. Once again, government is at the root of all of it. Combine this with the high costs of running a private practice, the threat of trial lawyers and the hundreds of thousands of debt accumulated in medical school and you've got a healthcare time bomb. When Obamacare goes into full effect, this could be the beginning of the end of American healthcare as we know it.

NEW YORK (CNNMoney) -- Doctors in America are harboring an embarrassing secret: Many of them are going broke.

This quiet reality, which is spreading nationwide, is claiming a wide range of casualties, including family physicians, cardiologists and oncologists.

Industry watchers say the trend is worrisome. Half of all doctors in the nation operate a private practice. So if a cash crunch forces the death of an independent practice, it robs a community of a vital health care resource.

"A lot of independent practices are starting to see serious financial issues," said Marc Lion, CEO of Lion & Company CPAs, LLC, which advises independent doctor practices about their finances.

Doctors list shrinking insurance reimbursements, changing regulations, rising business and drug costs among the factors preventing them from keeping their practices afloat. But some experts counter that doctors' lack of business acumen is also to blame.

Loans to make payroll: Dr. William Pentz, 47, a cardiologist with a Philadelphia private practice, and his partners had to tap into their personal assets to make payroll for employees last year. "And we still barely made payroll last paycheck," he said. "Many of us are also skimping on our own pay."

Pentz said recent steep 35% to 40% cuts in Medicare reimbursements for key cardiovascular services, such as stress tests and echocardiograms, have taken a substantial toll on revenue. "Our total revenue was down about 9% last year compared to 2010," he said.

"These cuts have destabilized private cardiology practices," he said. "A third of our patients are on Medicare. So these Medicare cuts are by far the biggest factor. Private insurers follow Medicare rates. So those reimbursements are going down as well."

Pentz is thinking about an out. "If this continues, I might seriously consider leaving medicine," he said. "I can't keep working this way."

Also on his mind, the impending 27.4% Medicare pay cut for doctors. "If that goes through, it will put us under," he said.

Federal law requires that Medicare reimbursement rates be adjusted annually based on a formula tied to the health of the economy. That law says rates should be cut every year to keep Medicare financially sound.

Although Congress has blocked those cuts from happening 13 times over the past decade, most recently on Dec. 23 with a two-month temporary "patch," this dilemma continues to haunt doctors every year.

Beau Donegan, senior executive with a hospital cancer center in Newport Beach, Calif., is well aware of physicians' financial woes.

"Many are too proud to admit that they are on the verge of bankruptcy," she said. "These physicians see no way out of the downward spiral of reimbursement, escalating costs of treating patients and insurance companies deciding when and how much they will pay them."

Donegan knows an oncologist "with a stellar reputation in the community" who hasn't taken a salary from his private practice in over a year. He owes drug companies $1.6 million, which he wasn't reimbursed for.

Dr. Neil Barth is that oncologist. He has been in the top 10% of oncologists in his region, according to U.S. News Top Doctors' ranking. Still, he is contemplating personal bankruptcy.

That move could shutter his 31-year-old clinical practice and force 6,000 cancer patients to look for a new doctor.

Changes in drug reimbursements have hurt him badly. Until the mid-2000's, drugs sales were big profit generators for oncologists.

In oncology, doctors were allowed to profit from drug sales. So doctors would buy expensive cancer drugs at bulk prices from drugmakers and then sell them at much higher prices to their patients.

"I grew up in that system. I was spending $1.5 million a month on buying treatment drugs," he said. In 2005, Medicare revised the reimbursement guidelines for cancer drugs, which effectively made reimbursements for many expensive cancer drugs fall to less than the actual cost of the drugs.

"Our reimbursements plummeted," Barth said.

Still, Barth continued to push ahead with innovative research, treating patients with cutting-edge expensive therapies, accepting patients who were underinsured only to realize later that insurers would not pay him back for much of his care.

"I was $3.2 million in debt by mid 2010," said Barth. "It was a sickening feeling. I could no longer care for patients with catastrophic illnesses without scrutinizing every penny first."

He's since halved his debt and taken on a second job as a consultant to hospitals. But he's still struggling and considering closing his practice in the next six months.

"The economics of providing health care in this country need to change. It's too expensive for doctors," he said. "I love medicine. I will find a way to refinance my debt and not lose my home or my practice."

If he does declare bankruptcy, he loses all of it and has to find a way to start over at 60. Until then, he's turning away new patients whose care he can no longer subsidize.

"I recently got a call from a divorced woman with two kids who is unemployed, house in foreclosure with advanced breast cancer," he said. "The moment has come to this that you now say, 'sorry, we don't have the capacity to care for you.' "

Small business 101: A private practice is like a small business. "The only thing different is that a third party, and not the customer, is paying for the service," said Lion.

"Many times I shake my head," he said. "Doctors are trained in medicine but not how to run a business." His biggest challenge is getting doctors to realize where and how their profits are leaking.

"On average, there's a 10% to 15% profit leak in a private practice," he said. Much of that is tied to money owed to the practice by patients or insurers. "This is also why they are seeing a cash crunch."

Dr. Mike Gorman, a family physician in Logandale, Nev., recently took out an SBA loan to keep his practice running and pay his five employees.

"It is embarrassing," he said. "Doctors don't want to talk about being in debt." But he's planning a new strategy to deal with his rising business expenses and falling reimbursements.

"I will see more patients, but I won't check all of their complaints at one time," he explained. "If I do, insurance will bundle my reimbursement into one payment." Patients will have to make repeat visits -- an arrangement that he acknowledges is "inconvenient."

"This system pits doctor against patient," he said. "But it's the only way to beat the system and get paid."

Obamacare to Cut Jobs of Artifical Hip, Knee Maker

Stryker, the Kalamazoo-based maker of artificial hips and knees, will cut 5% of its global workforce by the end of next year to reduce costs in the face of new fees on device makers required by the U.S. health care law.

The job cuts will reduce annual pretax operating costs by more than $100 million beginning in 2013, when the medical-device excise tax is scheduled to take effect, Stryker said Thursday in a statement. Stryker had more than 20,000 employees as of Dec. 31, according to Bloomberg News data.

Stryker expects to record $85 million to $95 million of the expense in the fourth quarter of 2011.

"These actions are part of our ongoing focus on quality, innovation and cost, and position the company to continue to provide strong, consistent growth in a changing environment," CEO Stephen MacMillan said.

Reposted from Freep

Obama Wants Your Health Records

By Kerri Toloczko, reposted from biggovernment.com

The federal government, as part of Obamacare implementation, is trying to figure out how to get its hands on everyone’s healthcare records.

It may seem like a small boat in the ocean of bureaucratic incursion that is Obamacare, but given the construction of the new law and the priority its authors and supporters place on “bending the cost curve,” allowing government access to American’s most personal records is a critical step in its effort to control healthcare costs at the expense of care.

The path to achieving this is to use treatment outcomes and other health data as instruments of rationing and denial of care through the Federal Coordinating Council for Comparative Effectiveness Research — created by President Obama — and based on European rationing boards.

There are several ways for the government to access our health records, and the U.S. Department of Health and Human Services is already contemplating options. One would be for the federal government to collect them directly. Another is mandating that the states, as part of Obamacare’s new healthcare exchanges, collect the information and pass it along to the federal government. A third would be to force private insurance companies to make the data available to the feds.

Notwithstanding any discussion of the government’s right to our private records, none of these are good ideas but not as bad as another option that some have floated; let a private contractor bid on the project to collect and maintain the information on behalf of the government.

Allowing a private company to access everyone’s healthcare records is an open invitation to disaster and a gross invasion of personal privacy. And more so as about the only company that could handle the job with any degree of competency appears to be Google.

Google’s business model is tracking and collecting preferred sites and other information from its users. Everything from favorite restaurants to marital status is fair game for the Internet behemoth, which uses sophisticated algorithms to identify who accesses the web in a given home — capturing birthdates, age, gender, imputed income and other information useful to determining what products and services might be of interest to a person when they go online.

Google collects and utilizes this information whether it has permission from the user or not, which is where the issue of private healthcare records comes into play.

Having those records, even if they are walled off and protected under law, does not mean they cannot be swept for information that is useful in other contexts. Everything from medical procedures you have had and their outcomes, medicines you take, your family health history, and details of your health insurance policy will be open to inclusion in Google data collection and marketing efforts through which the world’s largest search engine already generates much of its revenue.

Under a Google-driven collection of personal health data, there would be no “opt-in,” no “opt-out,” just your private records ripe for Internet picking.

The computerized healthcare record itself is helpful and useful. Many private studies have shown that electronic records can lead to enormous cost savings and cut down significantly on medical errors, helping to streamline costs and improve the quality of care available in hospitals today.

The problem is not that the information exists; it is how it can be used or, in this case, potentially abused. Even if no one can see the records, the possibility that they can be “data mined” if left in private hands is so strong that everyone should be concerned.

Medical records should be the property of the patient, and only the patient – an idea Congress and the states should aggressively seek to enshrine in law. Service providers and insurance companies need access to certain health information, but no outside entity should be allowed to touch them without a patient’s direct permission.

Google has turned the collection, analysis and recycling of personal information into an art form, and it shouldn’t be allowed to practice this art as the handmaiden of government with our health information. When it comes to records containing our private health data, a search engine should not be allowed any where near them. Nor, for that matter, should anyone else.

Doctor to Obama Supporters: Find Health Care 'Elsewhere'

America can't keep forcing doctors and hospitals into modern-day slavery by continually cutting their reimbursements, micro-managing their professional decisions and publicly accusing them of being greedy, and not expect to have a mass revolt on their hands. Doctors just want to make their patients better and be reasonably paid for their sacrifice of decades of intensive schooling and hours of stressful work. (They do have an average of $250k school debt to pay off, after all.) If there is anyone who should be making 6-figure-incomes in our country, it is these people who directly save lives everyday. Yet, our government is trying to force them to do more for less. You have it coming, America. Try to get our healthcare industry under your thumb and you will end up with no more good doctors or hospitals and more people dying from denied and inferior care.

A Florida doctor who opposes the new health care law posted a sign on his office door telling patients who voted for President Obama to get care "elsewhere," the Orlando Sentinel reported.

The sign on Dr. Jack Cassell's door reads, "Changes to your health care begin right now. Not in four years," the Sentinel said.

Cassell, a urologist, told the newspaper that he's not turning anyone away.

"That would be unethical," he said. "But if they read the sign and turn the other way, so be it."

A registered Republican, Cassell is providing his patients with photocopies of a health-care timeline produced by Republican leaders that outlines "major provisions" in the health care law -- and he's placed a sign above the stack of copies that reads, "This is what the morons in Washington have done to your health. Take one, read it and vote out anyone who voted for it."

Cassell told the newspaper that a patient's politics wouldn't affect his care for them, but he added he would prefer not to treat people who support Obama.

"I can at least make a point," he said.

[Source: FoxNews]

Must Read: Health Care is Not a Right

A long, but very good article on government-run healthcare. It's worth taking the time to read.

Introductory Note by Lin Zinser: In today's proposals for sweeping changes in the field of medicine, the term "socialized medicine" is never used. Instead we hear demands for "universal," "mandatory," "single-payer," and/or "comprehensive" systems. These demands aim to force one healthcare plan (sometimes with options) onto all Americans; it is a plan under which all medical services are paid for, and thus controlled, by government agencies. Sometimes, proponents call this "nationalized financing" or "nationalized health insurance." In a more honest day, it was called socialized medicine.

Most people who oppose socialized medicine do so on the grounds that it is moral and well-intentioned, but impractical; i.e., it is a noble idea--which just somehow does not work. I do not agree that socialized medicine is moral and well-intentioned, but impractical. Of course, it is impractical--it does not work--but I hold that it is impractical because it is immoral. This is not a case of noble in theory but a failure in practice; it is a case of vicious in theory and therefore a disaster in practice. I want to focus on the moral issue at stake. So long as people believe that socialized medicine is a noble plan, there is no way to fight it. You cannot stop a noble plan--not if it really is noble. The only way you can defeat it is to unmask it--to show that it is the very opposite of noble. Then at least you have a fighting chance.

What is morality in this context? The American concept of it is officially stated in the Declaration of Independence. It upholds man's unalienable, individual rights. The term "rights," note, is a moral (not just a political) term; it tells us that a certain course of behavior is right, sanctioned, proper, a prerogative to be respected by others, not interfered with--and that anyone who violates a man's rights is: wrong, morally wrong, unsanctioned, evil.

Now our only rights, the American viewpoint continues, are the rights to life, liberty, property, and the pursuit of happiness. That's all. According to the Founding Fathers, we are not born with a right to a trip to Disneyland, or a meal at McDonald's, or a kidney dialysis (nor with the 18th-century equivalent of these things). We have certain specific rights--and only these.

Why only these? Observe that all legitimate rights have one thing in common: they are rights to action, not to rewards from other people. The American rights impose no obligations on other people, merely the negative obligation to leave you alone. The system guarantees you the chance to work for what you want--not to be given it without effort by somebody else.

The right to life, e.g., does not mean that your neighbors have to feed and clothe you; it means you have the right to earn your food and clothes yourself, if necessary by a hard struggle, and that no one can forcibly stop your struggle for these things or steal them from you if and when you have achieved them. In other words: you have the right to act, and to keep the results of your actions, the products you make, to keep them or to trade them with others, if you wish. But you have no right to the actions or products of others, except on terms to which they voluntarily agree.

To take one more example: the right to the pursuit of happiness is precisely that: the right to the pursuit--to a certain type of action on your part and its result--not to any guarantee that other people will make you happy or even try to do so. Otherwise, there would be no liberty in the country: if your mere desire for something, anythingg, imposes a duty on other people to satisfy you, then they have no choice in their lives, no say in what they do, they have no liberty, they cannot pursue their happiness. Your "right" to happiness at their expense means that they become rightless serfs, i.e., your slaves. Your right to anything at others' expense means that they become rightless.

That is why the U.S. system defines rights as it does, strictly as the rights to action. This was the approach that made the U.S. the first truly free country in all world history--and, soon afterwards, as a result, the greatest country in history, the richest and the most powerful. It became the most powerful because its view of rights made it the most moral. It was the country of individualism and personal independence.

Today, however, we are seeing the rise of principled immorality in this country. We are seeing a total abandonment by the intellectuals and the politicians of the moral principles on which the U.S. was founded. We are seeing the complete destruction of the concept of rights. The original American idea has been virtually wiped out, ignored as if it had never existed. The rule now is for politicians to ignore and violate men's actual rights, while arguing about a whole list of rights never dreamed of in this country's founding documents--rights which require no earning, no effort, no action at all on the part of the recipient.

You are entitled to something, the politicians say, simply because it exists and you want or need it--period. You are entitled to be given it by the government. Where does the government get it from? What does the government have to do to private citizens--to their individual rights--to their real rights--in order to carry out the promise of showering free services on the people?

The answers are obvious. The newfangled rights wipe out real rights--and turn the people who actually create the goods and services involved into servants of the state. The Russians tried this exact system for many decades. Unfortunately, we have not learned from their experience. Yet the meaning of socialism is clearly evident in any field at all--you don't need to think of health care as a special case; it is just as apparent if the government were to proclaim a universal right to food, or to a vacation, or to a haircut. I mean: a right in the new sense: not that you are free to earn these things by your own effort and trade, but that you have a moral claim to be given these things free of charge, with no action on your part, simply as handouts from a benevolent government.

How would these alleged new rights be fulfilled? Take the simplest case: you are born with a moral right to hair care, let us say, provided by a loving government free of charge to all who want or need it. What would happen under such a moral theory?

Haircuts are free, like the air we breathe, so some people show up every day for an expensive new styling, the government pays out more and more, barbers revel in their huge new incomes, and the profession starts to grow ravenously, bald men start to come in droves for free hair implantations, a school of fancy, specialized eyebrow pluckers develops--it's all free, the government pays. The dishonest barbers are having a field day, of course--but so are the honest ones; they are working and spending like mad, trying to give every customer his heart's desire, which is a millionaire's worth of special hair care and services--the government starts to scream, the budget is out of control. Suddenly directives erupt: we must limit the number of barbers, we must limit the time spent on haircuts, we must limit the permissible type of hair styles; bureaucrats begin to split hairs about how many hairs a barber should be allowed to split. A new computerized office of records filled with inspectors and red tape shoots up; some barbers, it seems, are still getting too rich, they must be getting more than their fair share of the national hair, so barbers have to start applying for Certificates of Need in order to buy razors, while peer review boards are established to assess every stylist's work, both the dishonest and the overly honest alike, to make sure that no one is too bad or too good or too busy or too unbusy. Etc. In the end, there are lines of wretched customers waiting for their chance to be routinely scalped by bored, hog-tied haircutters some of whom remember dreamily the old days when somehow everything was so much better.

Do you think the situation would be improved by having hair-care cooperatives organized by the government?--having them engage in managed competition, managed by the government, in order to buy haircut insurance from companies controlled by the government?

If this is what would happen under government-managed hair care, what else can possibly happen--it is already starting to happen--under the idea of health care as a right? Health care in the modern world is a complex, scientific, technological service. How can anybody be born with a right to such a thing?

Under the American system you have a right to health care if you can pay for it, i.e., if you can earn it by your own action and effort. But nobody has the right to the services of any professional individual or group simply because he wants them and desperately needs them. The very fact that he needs these services so desperately is the proof that he had better respect the freedom, the integrity, and the rights of the people who provide them.

You have a right to work, not to rob others of the fruits of their work, not to turn others into sacrificial, rightless animals laboring to fulfill your needs.

Some of you may ask here: But can people afford health care on their own? Even leaving aside the present government-inflated medical prices, the answer is: Certainly people can afford it. Where do you think the money is coming from right now to pay for it all--where does the government get its fabled unlimited money? Government is not a productive organization; it has no source of wealth other than confiscation of the citizens' wealth, through taxation, deficit financing or the like.

But, you may say, isn't it the "rich" who are really paying the costs of medical care now--the rich, not the broad bulk of the people? As has been proved time and again, there are not enough rich anywhere to make a dent in the government's costs; it is the vast middle class in the U.S. that is the only source of the kind of money that national programs like government health care require. A simple example of this is the fact that all of these new programs rest squarely on the backs not of Big Business, but of small businessmen who are struggling in today's economy merely to stay alive and in existence. Under any socialized regime, it is the "little people" who do most of the paying for it--under the senseless pretext that "the people" can't afford such and such, so the government must take over. If the people of a country truly couldn't afford a certain service--as e.g. in Somalia--neither, for that very reason, could any government in that country afford it, either.

Some people can't afford medical care in the U.S. But they are necessarily a small minority in a free or even semi-free country. If they were the majority, the country would be an utter bankrupt and could not even think of a national medical program. As to this small minority, in a free country they have to rely solely on private, voluntary charity. Yes, charity, the kindness of the doctors or of the better off--charity, not right, i.e. not their right to the lives or work of others. And such charity, I may say, was always forthcoming in the past in America. The advocates of Medicaid and Medicare under LBJ did not claim that the poor or old in the '60's got bad care; they claimed that it was an affront for anyone to have to depend on charity.

But the fact is: You don't abolish charity by calling it something else. If a person is getting health care for nothing, simply because he is breathing, he is still getting charity, whether or not any politician, lobbyist or activist calls it a "right." To call it a Right when the recipient did not earn it is merely to compound the evil. It is charity still--though now extorted by criminal tactics of force, while hiding under a dishonest name.

As with any good or service that is provided by some specific group of men, if you try to make its possession by all a right, you thereby enslave the providers of the service, wreck the service, and end up depriving the very consumers you are supposed to be helping. To call "medical care" a right will merely enslave the doctors and thus destroy the quality of medical care in this country, as socialized medicine has done around the world, wherever it has been tried, including Canada (I was born in Canada and I know a bit about that system first hand).

I would like to clarify the point about socialized medicine enslaving the doctors. Let me quote here from an article I wrote a few years ago: "Medicine: The Death of a Profession."

In medicine, above all, the mind must be left free. Medical treatment involves countless variables and options that must be taken into account, weighed, and summed up by the doctor's mind and subconscious. Your life depends on the private, inner essence of the doctor's function: it depends on the input that enters his brain, and on the processing such input receives from him. What is being thrust now into the equation? It is not only objective medical facts any longer. Today, in one form or another, the following also has to enter that brain: 'The DRG administrator [in effect, the hospital or HMO man trying to control costs] will raise hell if I operate, but the malpractice attorney will have a field day if I don't--and my rival down the street, who heads the local PRO [Peer Review Organization], favors a CAT scan in these cases, I can't afford to antagonize him, but the CON boys disagree and they won't authorize a CAT scanner for our hospital--and besides the FDA prohibits the drug I should be prescribing, even though it is widely used in Europe, and the IRS might not allow the patient a tax deduction for it, anyhow, and I can't get a specialist's advice because the latest Medicare rules prohibit a consultation with this diagnosis, and maybe I shouldn't even take this patient, he's so sick--after all, some doctors are manipulating their slate of patients, they accept only the healthiest ones, so their average costs are coming in lower than mine, and it looks bad for my staff privileges.' Would you like your case to be treated this way--by a doctor who takes into account your objective medical needs and the contradictory, unintelligible demands of some ninety different state and Federal government agencies? If you were a doctor could you comply with all of it? Could you plan or work around or deal with the unknowable? But how could you not? Those agencies are real and they are rapidly gaining total power over you and your mind and your patients.

In this kind of nightmare world, if and when it takes hold fully, thought is helpless; no one can decide by rational means what to do. A doctor either obeys the loudest authority--or he tries to sneak by unnoticed, bootlegging some good health care occasionally or, as so many are doing now, he simply gives up and quits the field. (The Voice of Reason: Essays in Objectivist Thought, Ayn Rand, NAL Books, 1988, pp. 306-307)

Any mandatory and comprehensive plan will finish off quality medicine in this country--because it will finish off the medical profession. It will deliver doctors bound hands and feet to the mercies of the bureaucracy.

The only hope--for the doctors, for their patients, for all of us--is for the doctors to assert a moral principle. I mean: to assert their own personal individual rights--their real rights in this issue--their right to their lives, their liberty, their property, their pursuit of happiness. The Declaration of Independence applies to the medical profession too. We must reject the idea that doctors are slaves destined to serve others at the behest of the state.

Doctors, Ayn Rand wrote, are not servants of their patients. They are "traders, like everyone else in a free society, and they should bear that title proudly, considering the crucial importance of the services they offer."

The battle against socialized medicine depends on the doctors speaking out against it--not only on practical grounds, but, first of all, on moral grounds. The doctors must defend themselves and their own interests as a matter of solemn justice, upholding a moral principle, the first moral principle: self-preservation.

Concluding Note by Lin Zinser: In addition, we must join the doctors in their defense and in our own. Hospital administrators, nurses, physical therapists, health insurance companies, and patients must speak out against these plans, on moral grounds, as a matter of justice. If the doctors become slaves, so will we all.

Leonard Peikoff is a philosopher living in Southern California, and is the founder of the Ayn Rand Institute, and the author of The Ominous Parallels and of Objectivism: The Philosophy of Ayn Rand, the definitive presentation of Ayn Rand's philosophy of Objectivism. He is currently at work on his third book, The DIM Hypothesis.

[Taken from WestandFirm.Org]

AMA Obamacare Endorsement Sparks Doctor Revolt

The American Medical Association's much-touted endorsement of the House health care reform bill has triggered a revolt among some members who want the endorsement withdrawn.

Some members are outraged that the group's trustees made the endorsement without the formal approval of the organization's House of Delegates.

On Monday, delegates will vote on a resolution offered by some members that, if approved, will withdraw the AMA’s endorsement of the bill.

(FoxNews)

What Government Healthcare Does to Patients

I received an email today from a patient who was making an appointment to see a neurologist. She and the secretary were about to schedule the appointment for early next month. At this point, the patient mentioned that she was going to use Medicare to cover the visit. The secretary immediately pushed the appointment back to February 2010.

This is reality, folks. Doctors and their staff are hassled and under-reimbursed by Medicare. This secretary knew it and unfortunately the consequences of government mismanagement were pushed onto this patient who did nothing wrong except turn 65. Expanding the government's hand in healthcare is only going to result in more of the above situations. Fewer doctors will treat government covered patients unless forced, in which case we will end up with fewer doctors in general. Ultimately, patients will be the ones hurt the most. Contact your representatives and encourage them to do the responsible thing and stop any bill that expands government power in in your doctor's office.