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What Should Be Done to Repair the Healthcare System?

What Should Be Done to Repair the Healthcare System?

Stanley Feld M.D.,FACP, MACE

On March 10, 2020, Obamacare will be ten years old. Obamacare has had many failures. Obamacare’s biggest failure is the resulting distortion of the healthcare delivery system. The distortion is the result of all the stakeholders adjusting to Obamacare’s new rules and regulations.

All of the stakeholders had to adjust the way they delivered or priced healthcare to their individual advantage.

Primary care physicians started moving toward the model of Concierge Medicine. In order to have a primary care physician, consumers must pay primary care physicians between $2,000.00 and $38,000.00 annually to be in their panel.  The movement toward Concierge Medicine is the result of the Obamacare regulations, the healthcare insurance company’s reimbursement cuts, and the increase in malpractice insurance premiums.

Primary care physicians found that in order to make a living and pay their increasing overhead, they must become Concierge Physicians. This is to the disadvantage of consumers since they must continue to buy healthcare insurance.

The insurance industry has adjusted to Obamacare’s regulations by lowering reimbursement to physicians and hospitals while raising premiums. Insurance companies and Medicare Advantage programs have restricted enrollees to only certain physicians in their network and restricted certain treatments and access to certain specialists and groups.

It all goes back to President Obama’s statement, “If you like your doctor you can keep your doctor. If you like your hospital you can keep your hospital.” To my disappointment the AMA accepted President Obama’s obvious lie in 2010.

As the the government and the insurance industry decreased reimbursement physicians have had to increase the number of patients they see in one day in order to make up for their decreased revenue.

Malpractice claims and malpractice payments for claims have increased in most parts of the country. This resulted from a lack of tort reform by congress and the Obama administration. Physicians then increased diagnostic testing in order to cover all possible illnesses.  The increase in testing led to an increase in healthcare cost.

Obamacare has also increased the cost of insurance by requiring payment for additional coverages. The first dollar insurance coverage after deductibles are met has resulted in the overuse of the healthcare system. The government and the insurance industry are trying to decrease the overuse of the system by increasing deductibles.

In fact, some Obamacare insurance plan deductibles are so high that insurance payment never kicks in. People who buy Obamacare insurance plans cannot afford the deductibles and do not use the insurance until they are so sick, they cannot avoid being hospitalized.

It is impossible to figure out how health insurance premiums increases are calculated by the private healthcare insurance sector or the government healthcare insurance sector. It is impossible to figure out how the multimillion-dollar salaries for insurance and hospital executives are calculated. These expenses are part of why insurance premiums are rising.

It is also impossible to determine how hospital systems price their care. The government also pays hospital systems a premium for outpatient hospital care in an outpatient setting. The fees are at least 20% higher than in a free-standing private practice office.  

Hospital systems are figuring out how to manipulate their reimbursement systems to have an advantage over their competitor.  In New York City, Columbia Presbyterian Hospital System has accumulated ownership of many hospitals inside the city and its suburbs. With that ownership, they have acquired many in-patient and out-patient hospital salaried physicians. The hospital system is now demanding increased payment from healthcare insurance companies and the government in order for patients to use their system. The hospital system has hired many of the physicians’ patients desire to see. Columbia Presbyterian has gained control of the reimbursement levels in those markets.

There is an encouraging trend that was started by Keith Smith M.D. in Oklahoma City. Dr. Smith started a cash-only outpatient surgical clinic several years ago. He charges less for procedures than a patient’s deductible from some insurance companies.

This gives us some insight into how much fat is in the healthcare system expenditures.  Dr. Smith and physicians working in his outpatient clinics are happier and are making more money than they were working for local high-cost hospital systems in town. The patients are happier because there are no hidden or surprise costs.


Dr. Smith’s clinic is drawing patients from all over the United States. He has also inspired the formation of many similar clinics in the U.S.

This is not new. Specialists such as gastroenterologists have opened freestanding centers. They charge less for colonoscopy and endoscopy than the hospital systems. Radiology clinics have done this for many years. The hospital systems have, somehow, worked out payment for their higher costs with the insurance industry and the government.

Dermatology is a specialty that does not need a hospital system. Large physician-owned

dermatology clinics have opened. They charge less than the dominant local hospital system.  

Many of these large specialty centers have sold their clinics to venture capital firms.  

How the venture capital firms are going to leverage their investment is unclear to me.   

Emergency rooms all over the country are overcrowded because primary physicians cannot see all of the patients in their offices in a timely manner. Hospital system emergency rooms are inefficient and overpriced. The ER is an unpleasant experience for many patients.

Venture capital firms have opened free-standing Urgent Care and Emergent Care centers all over the country. (Doc-In The Box). Many of these centers are covered by nurses, nurse practitioners, and physician assistants. All physicians have to do is co-sign with the provider to get reimbursement by the government and the healthcare insurance industry.

This is not my idea of developing patient-physician relationships.    

If a patient has to be admitted to a hospital his primary care physician is not permitted take care of him in many hospital systems. Hospital systems have hired hospitalists to care for patients. A patient might see a different hospitalist each day of the admission.

What happened to the therapeutically valuable physician-patient relationship? This relationship is critical for curing much morbidity from chronic illness. 

 I have covered the Repair of the Healthcare System in great detail in the past.

 I have also covered the errors in the structure of Obamacare leading to the distortions in the delivery of healthcare and the increased costs of the healthcare system.

The stakeholders are physicians, patients, hospital systems, insurance companies, pharmaceutical companies, and the government.

All patients want is to get the best medical care when they get sick. The interest in disease prevention is slowing growing events though many millions of dollars have been spent on programs that could help prevent chronic disease.

All hospital systems, insurance companies, pharmaceutical companies are interested in are maximizing profits and minimizing expenses.

All physicians are interested in is delivering the best care possible.

Patients and physicians are the most important stakeholders in the system.

The government wants to spend the least amount of money possible to enable the best care at the lowest price.

There has been little attempt by congress, the bureaucracy or previous administrations to remedy the defects I have pointed out.

 I have not seen any attempt by Congress to lower the price by decreasing the bureaucratic impact on the price of healthcare. Nor have I seen the exposure of the clandestine deals hospital systems make with insurance companies or the government.

I have not seen any movement toward decreasing the malpractice crisis in America. Tort reform has been vitally necessary for the last thirty years. It has been totally ignored by government officials.

These are some of the basic reforms necessary to start repairing the healthcare system. All our politicians do is kick the can down the road to the advantage of the secondary stakeholders and not the consumers.

These are some of the main reasons the system has to convert to a consumer-driven system that I have outlined previously.

Consumers must control their health and their healthcare dollars. They must be provided with an education that will help them control costs. They must be provided with financial incentives to control costs.

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The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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