Rheumatologists React to Looming Medicare Payment Reductions

Herbert S. B. Baraf, MD, Arthritis and Rheumatism
Associates, P.C., Wheaton, Maryland

“The 29.5% SGR reimbursement cut, if it goes through, will be devastating for many practices. Many cognitive practices, like primary care and rheumatology, run overheads in the 70% to 75% range. This cut, plus the additional 2% cut slated if the ‘supercommittee’ cannot reach an agreement on additional budget cuts, would force many practices to take a significant loss in providing patient care. In regions where there are shortages of rheumatologists, I would anticipate physicians closing their practices to new patients covered in the Medicare program as a means of survival.

“The MedPac ‘fix’ is equally unacceptable. Even if rheumatologists were treated in the primary-care category, a freeze over 10 years in reimbursements is unrealistic. The cost of rent, staff, postage, electricity, and IT support will not be frozen. At a time of significant physician shortages, access to care is already threatened nationwide. The SGR and the MedPAC fix flies in the face of reality.”

Cindy Weaver, MD, Rheumatology Associates,
St. Luke’s Hospital, Duluth, Minnesota

“MedPac’s recommendations will have unintended consequences. Many cognitive subspecialties, such as endocrinology, infectious disease, and rheumatology, are very poorly reimbursed and survive only through subsidies from other departments. To further reduce their reimbursement will jeopardize these specialties.

“For instance, in my hometown there were for several years three rheumatologists in two separate groups. One group was employed by a private practice model orthopedic group. The other doctor worked for a multispecialty practice. The orthopedic group decided, from a business standpoint, they could no longer continue to support their rheumatology group. After considerable scrambling and negotiation, these two rheumatologists were able to find employment with their local hospital. But one of the doctors left the city. There is now an eight- to nine-month wait for a new rheumatology patient appointment. If declining reimbursements for these types of specialists continues, I expect this kind of business decision will be repeated time and time again.”

Sharad Lakhanpal, MB, MD, Rheumatology Associates,
Dallas, Texas

“Physicians have the only profession in which professional fee rates are set by the government. Members of Congress also do not often realize that the government is also setting our fees across the board, because many private insurance rates are also based upon Medicare rates.

“Over the last seven to eight years, physician fees have basically been kept the same, without any inflationary or cost-of-living adjustments. This means that, effectively, with the cost of inflation over that time period, in terms of 2004/05 dollars, we have already had a 25% to 28% pay cut. When you are looking at MedPAC’s proposal to cut 18% over three years followed by a freeze, with the cost-of-living allowance this would ultimately be around another 25% cut. So in the end it would be around a 35% to 40% cut over the next eight to 10 years, which will not be tenable.