Home Forums Discussions General Discussion Doctors Providing Healthcare

Seems obvious, yet most folks who have an employer provided healthcare via insurance company perceive the system as they pay their hard earned money to an insurance company, and all the healthcare providers work for the insurance company.

As an abstract logic problem I wonder why providers haven't take the middle-man[woman] out of the equation. I realize that practically it has become a highly regulated marketplace (which perverts how things would naturally function) that gives insurance companies and hospitals artificial advantages.

So, rather than saying what doctors won't take, can doctors in a local market band together and offer a direct alternative?

Is part of it that the band of doctors need to "become an insurance company" that is owned and operated by the providers?

As a small business operator, I would love to buy a product from people who are good at what they do, directly accountable, and cut out the middle-man.

At a fundamental level, we all know that we are better off with a system run by FedEx or UPS, rather than the USPS.

So, what are affirmative steps that we can take?

Indy,
been there, done that, have the t-shirt (literally).
I headed up the physicians (through a foundation for medical care) locally, in consortium with our hospitals, to create an HMO (Key Health Systems).
Physicians can not get together to set prices (high or low) without running afoul of the FTC (US Supreme court decision in the Maricopa case, fines and trebled damages, ugly). In addition, there has to risk sharing (while a hospital stay and surgery is not so bad for the local group to both do and take responsibility dollar wise for, a transplant would have to be referred out and is really big bucks). So there has to be a formal HMO or Insurance company structure. Otherwise you can't take risk (take premium $ in return for insuring the health care delivered).
Unfortunately, that means a lot of cash reserves. Before we could apply for the HMO License, we had to have $2M+ in reserve. This meant bringing in, you guessed it, an insurance company as a "partner" (who shall remain nameless)
There are diametrically opposed interests here. An insurance company calls payments made to doctors and hospital "loss ratios", and wants to have the lowest possible loss ratio. Doctors and hospitals want as much of the premium dollars as possible.
That effort fell apart over time, as the ins co wasn't returning sufficient return to their shareholders (plus other bad management decisions).
There is some hope in the "Accountable Care organizations" provided for in Obamacare. but, leave it to our brilliant congress, there is NO anti-trust exemptions built in. An ACO is supposed to be a group of doctors and hospitals who band together to deliver care to their community. But until you expend the resources and time to put one together, you have no idea if your ACO will pass muster with the FTC. They are giving no guidelines.
SNAFU is the order of the day.

I believe health care is a local issue, and needs to be paid for in a local sense, with appropriate referral and payment mechanisms for those things only done at a referral center. ACO's could do that if the feds would just get out of the way.

Oh by the way, health insurance is NOT, and never will be "health care". Health care is what I deliver to my patients. An insurance company can't and never will be able to do that.

Roger,

Thank you for taking the time to respond with your experiences, and provide a basis for a more informed conversation.

It sounds like a major difficulty is cash reserves to get started, but that is something (cash raises for startups) that I have been part of the team to pull that together, and I can testify that I have see millions raised for something far sketchier than Doctors providing Health Care. Never easy, but a straightforward business model of earn-out on the ongoing margin replacing the investor cash and generating ownership stake for the principals of the ongoing operation.

Something along those lines seems a solution for keeping insurance companies out of the mix.

I've sat through multiple ACO meetings on behalf of clients, and the ones I've experienced were perceived by the doctors attending as 1) the hospital is going to run the show and 2)what other choices do I have as a independent? There is the potential for better patient care, outcomes, and results based compensation, but as you have alluded to, the whole structure is not fully baked from a governmental point of view.

What is your take on the difficulties & issues of operating as an HMO? Are there greater difficulties, issues that would emerge if you didn't have an insurance company as a "partner"? Setting aside the issue of billing & PM, could you see AC being able to serve as the patient care/tracking platform? (given that the infrastructure is in place to operate at that scale)

I've said in more clearly elsewhere here on the boards; I'm clear on what health care is, and that is not what insurance companies are in the business of doing. My point was that your average employee who hasn't dealt with insurance companies as an employer doesn't understand the difference. Until, of course, you have to lay them off or close and they have to deal with insurance companies themselves.