The myth of a physician exodus under Medicare for All

November 4, 2019

Topics: Quote of the Day

By Aaron Carroll, M.D.
JAMA Forum, October 30, 2019

As “Medicare for all” gains steam in the Democratic primary, many physicians are concerned about reduced revenues from the program compared with private insurance. Even an expansion of the program, as many candidates’ plans call for “Medicare for more,” causes angst. Inevitably, some physicians will threaten to opt out of Medicare and refuse to see patients.

Such calls are, for the most part, bluffs. We need only examine how many physicians have followed through on past threats to see that.

For years, the Association of American Physicians and Surgeons claims that it’s simpler for physicians to opt out of Medicare than to stay in. Physicians have not been listening.

It’s important to understand that even when physicians threaten to opt out periodically, very few ever do. In 2010, for the first time ever, the number of physicians who had officially opted out of the program with the Centers for Medicare & Medicaid Services (CMS) reached triple digits—a total of 130. That’s out of the 850 000 or so licensed physicians in the United States that year.

The Medicare Access and CHIP Reauthorization Act of 2015, or MACRA, made it easier for physicians to get out if they wanted to. Before that, physicians needed to re-file with the program every 2 years. After 2015, however, opt-outs could be permanent, lasting until physicians filed affidavits to opt in again. With that, opt-outs climbed to their historically highest level in 2016. Even then, though, there were only 7400.

That number represents fewer than 1% of physicians. And, as a Kaiser Family Foundation infographic in JAMA pointed out, more than 40% of them were psychiatrists.

Today, CMS updates its data on physicians who opt out of Medicare quarterly, and the list of clinicians who have filed affidavits is easily accessed online. As of October 2019, psychiatrists, 3911 of them, remain—by far—the largest group of physicians who choose not to participate in Medicare. They’re followed by clinical psychologists, dentists, oral surgeons, and clinical social workers.

Recently, a study in the Journal of General Internal Medicine delved deeper into the population of psychiatrists who opt out of Medicare. The authors found significant variation in where psychiatrists who opted out practiced. In more than a third of hospital referral regions, none did. California and New York had the highest opt-out rates, but even there, the averages across the state were only 10% and 13% respectively.

Older psychiatrists (those 65 years or older) were most likely to opt out, as were those who identified as female. Those who graduated from a top-20 ranked institution were more likely to leave, and those who graduated from a foreign medical school were much less likely to do so. Perhaps most significantly, psychiatrists were more likely to opt out when there was little competition in their geographic area.

Still, there’s a general sense that we have a shortage of mental health services, including for elderly patients, and it’s not optimal that so many physicians who might see them have chosen not to do so for Medicare beneficiaries. But more concerning are physicians who might serve in a primary care capacity.

There, the numbers who refuse are smaller. Family medicine has only 1544 physicians who opt out. Internal Medicine has only 1003.

Of course, even if physicians choose not to fully opt out of Medicare, they may elect not to accept new patients. A Kaiser Family Foundation analysis (excluding pediatricians) found that only 72% of primary care doctors were willing to accept new patients with Medicare in 2015. Of course, only 80% were willing to accept new patients with private insurance.

Given the overwhelming number of physicians who accept Medicare, it’s ironic that so many people think that they’ll have an easier time finding a physician if they have private insurance coverage. One of the most common ways that private insurance reduces its cost is by establishing networks, and then steering their beneficiaries to physicians in them. Usually, the cheaper the plan, the smaller the network.

Medicare Advantage, the privatized optional form of Medicare, has fewer options than traditional Medicare. Another Kaiser Family Foundation analysis showed that networks of Medicare Advantage plans included, on average, fewer than half of physicians in any county. Too few patients realize this. Even when they do, research shows that they have trouble figuring out which doctors they can really see.

There are plenty of reasons to be concerned about a transition to a Medicare-for-all type of system in the United States. Any big transition, even if it wound up being better than what we had before, would likely cause major disruption. But a mass exodus of doctors from Medicare is unlikely. Physicians need to see patients, and in such a system, all the patients would be covered by one carrier.

Even in a “Medicare for more” system, evidence from the past shows us that the vast majority of physicians are likely to remain. The ones who won’t may be more vocal, but they’ll be the exception, not the norm.

https://newsatjama.jama.com…

---

Comment:

By Don McCanne, M.D.

Some opponents of single payer Medicare for All claim that there would be a mass exodus of physicians if a universal, single payer version of Medicare were enacted and implemented as the sole payment source for health care in America. Aaron Carroll explains why this is highly unlikely.

These predictions fail to understand the nature of the physician. From the earliest days that students decide that they want to become physicians, they know that they are planning to enter a profession (not a “business”) that is dedicated to caring for patients. It is not as if they would try to give this a go and if they didn’t like it they could move on to some other business venture. This isn’t to say that there aren’t those who may identify lucrative opportunities within health care and align themselves in that direction. But even there, the primary concern of the physician (not the medical-industrial complex) would remain the delivery of health care for the benefit of the patient.

It is often claimed that under Medicare for All prices would be reduced to Medicare rates (some proposals even specify this) and that they are too low to sustain physician interest in continuing to work in the profession. First of all, the classic single payer model calls for negotiation of fees or capitation rates. The public stewards would balance their role in preventing overpayment that might excessively enhance the wealth of the physicians, with providing enough monetary resources to ensure adequate capacity in the system while at the same time providing fair margins for the physicians.

But let’s assume that the payment level is at the current Medicare prices. Would that really be too low to sustain physicians’ practices? There would be increased revenues since physicians would no longer have nonpaying charity cases – the system would cover those patients – and there would no longer be unpaid accounts or patient bankruptcies due to uninsured patients being unable to pay their bills. Also there would no longer be losses due to the inability to collect deductibles, coinsurance and copayments since they would go away. More importantly, the profound administrative burden placed on physicians would be lifted under a single payer system, and, assuming the same payment rates, those exorbitant administrative costs would be recovered. For most practices that would be more than enough to fill in the difference between Medicare payment rates and commercial insurance payment rates. Also the experiences in other nations have shown that there is not a net reduction in compensation with expansion of their systems to cover almost everyone.

The predicted physician exodus under Medicare for All is not just a bluff, it is a total myth.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.