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The Domino Effect of the Affordable Care Act

By Rob Francis, Chief Operating Officer, The Doctors Company


Like falling dominos, changes from the Affordable Care Act (ACA) are pushing primary care physicians (PCPs) and patients into other forms of healthcare delivery, which in turn affects patients' access to care and drives some to new provider options. These massive changes to our healthcare system bring both benefits and risks.

PCPs are in short supply in many regions of the country, a trend that is expected to continue. PCP income had been rising slightly each year; however, a 0.5 percent raise in Medicare reimbursement set for 2016-2019 by the Medicare Access and CHIP Reauthorization Act (MACRA) turned into a 0.3 percent pay cut when the Medicaid rate increases enacted as part of the ACA expired. Those Medicaid reimbursement cuts and a barrage of other payment reductions implemented by the Centers for Medicare and Medicaid Services (CMS) trumped the proposed MACRA gains and are chipping away at PCPs' pay.

Consolidation Shows No Sign of Slowing Down

A physician in a solo or small practice often finds it difficult to survive, let alone thrive, as growing government regulation increases reporting requirements and requires implementation of expensive electronic health record systems. It's not surprising that PCPs are increasingly leaving their own practices for larger groups, hospital employment, and new forms of practice that enable them to spend more time with fewer patients. Each option promises a better work-life balance.

Some PCPs opt for retirement but are then faced with the reality that finding a junior associate or buyer for small practices is difficult as consolidation continues and payers opt for narrower networks. Closing established practices impacts patients' access to primary care, as does selling or consolidating with larger practices. The new owners may not be in the same insurance networks, and patients must find a new provider who relies on medical records, not a long-term doctor-patient relationship -- which could potentially result in overlooked signs of illness.

New Practice Models Embraced

A growing number of PCPs are leaving traditional practice for concierge medicine or direct primary care, two cash-based practice styles that involve physicians significantly reducing the number of patients in their practice. Driving this trend is the approximately 20 million newly insured patients who have entered the healthcare system since the implementation of the ACA. This influx has resulted in longer wait times for appointments and shorter visits with the doctor.

Both concierge and direct primary care provide their patients with greater physician access and more personalized care. In direct primary care, the patient often pays a monthly fee and can opt out at will. Insurance is not accepted, so direct care physicians don't need an office manager to file insurance claims. In a concierge-style practice, patients pay an annual fee or retainer, which may or may not be in addition to other charges. Insurance may be billed as well. The American Association of Private Medicine, a professional association of physicians practicing concierge or direct care medicine, says that the number of retainer-based practices in the U.S. has grown 25 percent annually since 2012, reaching about 12,000 doctors in 2016.

The move to concierge medicine and direct primary care has benefits for physician and patients who take advantage of these new types of practice. In both models, the physician is in better control of his or her income and spends more time with each patient. Having fewer patients and a potentially deeper relationship with each patient may lower the risk of adverse events, which benefits the patient and could lead to lower malpractice premiums for the physician.

However, this trend could lead to another domino falling: As more PCPs leave traditional practice for other models, patients unwilling or unable to pay for concierge medicine or direct primary care must find other providers -- of which there are fewer. Patient frustration can reach a boiling point when an appointment can't be scheduled within a reasonable timeframe or when patients must spend hours on the phone to find a PCP in the local area willing to take new patients.

Patient Care Goes Retail

Patients are beginning to seek care from retail outlets such as Walmart, CVS, and Walgreens. In addition, new smartphone apps can put patients in video contact with physicians or advanced practice providers (APP) to assess their condition. Retail clinics today represent about 2 percent of primary care services in the U.S. However, utilization is expected to grow as patients are unsuccessful in finding convenient care elsewhere, retail locations expand their care offerings, and traditional health systems link with retail clinics. Retail clinics provide what patients want -- convenience, quick access, and affordability. They are also causing some traditional PCPs to alter the way they practice to meet patient demands and needs in a similar way to retail clinics.

At retail clinics, patients are more likely to be seen by an APP, not a physician. Even patients with a regular PCP may frequently see an APP, such as a nurse practitioner (NP) or physician assistant (PA). APPs, employed by doctors to help with large patient volume, perform routine and complicated medical services for hospitals and medical practices across the country. The number of PAs in the U.S. has increased 36.4 percent over the last five years; the number of NPs has doubled in the past 10 years.

The trend toward retail clinics and greater use of APPs comes with increased risks. The absence of an ongoing relationship with a single provider may result in little or poor communication and coordination among providers and a lack of continuity of care -- a potentially harmful situation for the patient. When PCPs hire APPs, they assume additional risks because the PCP is vicariously liable for the actions of each APP. According to closed claims data compiled by The Doctors Company and the industry trade group PIAA, most malpractice claims attributed to APPs can be traced to clinical and administrative factors that potentially could have been identified and remedied by the employing physician or hospital. Therefore, malpractice premiums for physicians employing a large number of APPs may need to be reviewed and revised, commensurate with the increased risk.

The dominos are falling, pushing PCPs out of traditional practice and patients to concierge medicine, direct primary care, larger group practices, retail clinics, and APP-based care. While the benefits of these changes are many, whether they outweigh the potential risks to both patients and physicians has yet to be seen.

 

Posted in: Federal Government News, Medicaid, Medicare, Hot Topics, Insurance