Can You Convert Your Practice to a Cash Practice?
With all the changes coming down the pike with the healthcare reform bill, you should be strategizing on how to accommodate these changes into your practice, while still maximizing patient care and profitability for your practice. While this seems like a tall order, (only because it is) you do have time until the majority of mandated changes take place in the healthcare insurance industry. Most of the effects of the healthcare reform don’t take place until 2014, with only a few beginning in 2012.
So, let’s look at some of the adjustments that you can make, gradually, to ensure that you can continue to provide quality care to your patients in the future.
One potential aspect of your practice that will need to be emphasized is the switch to a cash practice. This need not be as hard as you may first envision the switch, but in many instances it may be required, especially once the rationing of healthcare becomes necessary. And make no mistake about it, the healthcare reform bill almost guarantees that healthcare rationing will take place in the future.
In my younger days, I spent time in New Zealand and in England and saw first hand how their National healthcare systems worked for the average citizen. Even though there was universal healthcare coverage, many people paid cash for services that they wanted (or needed). There was a two- tiered healthcare system in place; an official system where the government paid for healthcare, though the wait was sometimes long, and a cash system (often separate doctors) who accepted cash for quicker appointments and procedures. This was especially true for alternative providers, whose services were not covered by the national healthcare system, or were only reimbursed with a medical doctor’s prescription.
I originally thought that only the rich would be able to afford the high tax rate to help support the National healthcare system AND pay additional cash for services that they wanted, but that was not the case. Many working class citizens (especially those who were self-employed or farmers) could not afford to wait to be seen by the government provided doctor, so they went to cash only doctors. These patients had to get back to work as quickly as possible in order to keep food on the table and a roof over their heads. This was especially true for those seeking treatment that was deemed non-critical by the government.
The point I’m trying to make is that even in a society where medical care is “free”, people will pay for medical care out of their own pockets, if they feel that they benefit. Here in America, too many people have had their medical care provided by someone else (usually their employer) and have come to view medical care as a “right”, when clearly it is not.
The challenge that doctors face is changing their patients’ attitudes back to where they are responsible for their own healthcare. If, and when, patients take the responsibility for their own healthcare, doctors can return to treating patients as they require care, not as an insurance company (or government) decides the patient needs to be treated. Returning to a fee for service, cash practice, will benefit both the doctor and the patient.
The patients of most alternative healthcare providers (which you have already incorporated into your practice, right?) are already accustomed to paying cash for the treatment that they receive. Most of these patients probably have medical insurance provided for them through their employer, yet they go outside their coverage to receive the care they feel they need. This clearly shows that people will pay cash for healthcare treatment, if they feel that their insurance doesn’t provide for their needs. These patients will be much more amenable to paying cash for their medical treatment also.
From a purely logistical, financial, viewpoint you, as the doctor, should be able to provide better and less costly treatment if you provide the treatment and the patient pays for their treatment as they leave. This is more efficient than having the employer hire an HR firm, who pays an insurance company, who pays an adjuster, who pays a claim sent in by a medical billing firm, (who was hired by a medical practice), after hiring someone to review the treatment notes, which were sent by a transcription service (hired by the doctor’s office), after the doctor dictated his notes justifying his treatment for the patient.
That is why the ultimate cost to the patient can be up to 50% less for the same service in a cash only practice. Of course, the patient doesn’t realize all these costs, which they are already paying for, are already built into the system.
There are still the problems of malpractice concerns and the documentation and defensive medicine which that entails; and the millions of lost jobs involved in the whole insurance-medical-legal complex, but these issues can also be resolved and will be discussed in future postings.
Submitted by Dr. DG Comfort, CO
This entry was posted on Friday, August 20th, 2010 and is filed under Business Trends, Cash Medicine, Healthcare Reform. You can follow any responses to this entry through RSS 2.0. You can leave a response, or trackback from your own site.
- #1 by Bradley K Rethwill DC on August 20th, 2010
I am interested to hear what you have. I have no practice now even though I was in practice for 25 years. Back in 99 it took the insurance companies in Nevada to finally bankrupt me from pulling all my patients and sending to their goons willing to sell their soul to get them. I know they had no idea where they were coming from but just keep sending them and I will take pennys on the dollar as long as I can keep my practice, well for me I did not join for this reason and when I was desperate to join I was locked out with \WE HAVE ENOUGH DOCTORS WE WILL KEEP YOUR APPLICATION ON FILE. I left for Costa Rica and tried to begin a practice there on cash never happened and was force back to Reno hoping that the laws saw the light and got rid of this system. I lost all my saving over there as well. I found coming back to Reno the system had just gotten worse, as the politians found it was a great piggy bank for them. All the PPO, HMO and MCO’s were locked for new doctors over these 12 years and still on going. I moved to Oregon where I got on insurance, but could still not get enough ahead to get out of someone elses office where I could put up a sign. I got hurt in the mean time and ended up back in Reno where I now live in my mother home. I plan on going back up and start over if I can get some avenue to proceed again, but now we have something else staring us in the face with Obama Care and medicare changes. I tried to turn my practice into a cash practice in Reno for three years before letting each employee go until there was only me, but it could not be done. I found every patient that I had did not want to pay cash any cash, no matter what deal I was willng to make them. They had insurance and they wanted to use it, even if that meant leaving me. it would kill me to get five calls a day on potiential new patients and the first words were do you take blank insurance. I would try to explain how they normally still had to pay copayments probably higher then my fees, but they were not interested……they did not know me or my treatments and they just wanted to use their insurance. My patients one by one left me crying as they asked me who would I refer them to. The few cash I had were not enough to keep my doors open and they too came when they wanted and did not want any program or my dictation on how important it was. Economy will be getting worse and more jobs will go down and people will be lost in the shuffle into Obama Care for their family. SO, I AM REALLY INTERESTED IN HOW YOU THINK YOU HAVE THE ANSWERS TO CASH PRACTICE.
- #2 by Grant Shapiro, DC on August 21st, 2010
Agreed. I am a chiropractor. My practice as well as most of my colleagues have some portion of practice as “cash” paying patients without the “burden” of insurance approval, denial, preauth., predetermination, deductibles to be met, more services to be paid by the patient or massively discounted reimbursement. My practice in particular used ot be about 50/50 cash/insurance. At first the 25% of the cash collections was from supplements and lab testing (out of network). I then went out of network with every insurance co., literally everyone. Then as I finished my last contract termination HNA pops up for a renewal. I was in so many other contracts I did not have the opportunity to enjoy the benefits of the HNA contract, 70-80% of MY BILLED CHARGES, b/c the other contracts trumped the HNA contract. Providers need to be SO careful! At this time, about 70-80% of my practice is “cash”. I will see in the next month or so, from the EOBs, if the HNA contract is as good as they say it is. I have just started to bill some claims on a couple patients through the HNA network. We will see if it as promising as they say. Wish me luck so to speak.
Blog subscriptionReceive email notification when a new item is added in this blog.
Leave a comment
Make sure you enter the (*) required information where indicated.
Basic HTML code is allowed.