Effects of health care reform on small medical practices

It is clear from the content of the healthcare reform that the Obama administration wishes doctors to join large organizations which they believe can deliver more efficient care and which will be better able to translate the financial incentives and payment strategies envisioned by the legislation into actual delivery strategies to make things more efficient. Unfortunately such "efficiency" does not necessarily translate into better care. What you can expect to disappear as medical care transitions into large organizations: 1) small intimate practices 2) continuity with one doctor, 3) involvement of the doctor in routine care, 4) your ability to pick the best person to do each part of an episode of care, even if the doctors belong to different organizations. This has to do with the payment mechanism which will be adopted of bundling payments for an episode of care. This means only one organization will be able to deliver the care for the entire episode. For example, if you have a heart attack and require bypass surgery, the organization which admits you for the heart attack will be paid a lump sum for the entire episode of care, and you will not be able to choose a better surgeon in a different center.

While am in favor of health care reform including increasing coverage and preventing insurance companies from cherry-picking the lowest risk patients, I am very much against the type of payment bundling that is being promoted by the Center for Medicare and Medicaid Services and the health care reform legislation. Nothing in this type of bundling promotes high quality care. Just like the prospective payment system for hospital care, this type of payment promotes efficiency and reduced service during an episode of care. Quality measures are imperfect and tend to be very slow to incorporate and reflect new innovations and technology.

Pharmaceutical company and medical device company interests will continue to promote the use of unnecessary expensive technology. On the other hand, we are now likely to see powerful healthcare industry interests promote the underuse of needed care across the spectrum of medical care for each episode of care just as they have promoted decreased use of services during a hospitalization. But now there will be nowhere for the patient/consumer to go and no time or place at which the person CAN obtain the needed service. As with the passage of prospective payment for hospital care in the 1980s, there will be little or no incentive to provide high quality of care. The quality indicators used to date for performance bonuses for physicians (which in the future will go to the large organizations which employ these physicians) are generally inadequate and and reflect little of what makes care truly high quality.

We are now down to 25% of doctors in small practices. Healthcare reform as it is currently constituted will reduce that even further. I find this very sad. As someone who has devoted my entire career to improving medical care, often working in hospitals against the perverse financial incentives of the prospective payment system, and as someone who now works as a consultant helping people find good medical care, I am keenly aware of how these new payment strategies of bundling for episodes of care will reduce consumers' ability to choose good doctors.