FPs Would Trim New Medicare Patients in Response to Pay Cuts

Family physicians probably would continue to see their current Medicare patients, but they would be unlikely to accept new patients if Medicare were to impose future physician payment cuts, according to an AAFP member survey.

The survey, which received responses from 2,216 members, found that 48.6 percent of respondents likely would continue seeing their current Medicare patients despite anticipated physician payment cuts; 32.8 percent were unsure whether they would continue seeing their current Medicare patients. Nearly 56 percent of respondents, however, indicated they would stop accepting any new Medicare patients.

The results of the Academy's survey augment AMA findings on this issue.

"Nearly half, 45 percent, of the physicians surveyed by the AMA say next year's Medicare cut will force them to either decrease or stop seeing new Medicare patients," said AMA President J. Edward Hill, M.D., a Tupelo, Miss., family physician, in a March 16 news release announcing the AMA survey results. "Physicians want to treat seniors, but Medicare cuts are forcing physicians to make difficult practice decisions."

Without congressional intervention in the 2007 budget, Medicare payment to physicians would drop by nearly 5 percent.

A study from the Center for Studying Health System Change reported in January that in 2004-05, physicians continued to accept new Medicare patients despite stagnation or reductions in the program's payment rates.

Some respondents to the AAFP survey noted that results from such surveys might not describe the full implications of Medicare payment cuts. For example, one AAFP survey respondent said such questionnaires don't account for the ethical and financial dilemmas faced by small or solo practices in underserved areas.

"I need to qualify the fact that my practice will probably continue to accept Medicare patients" despite the financial loss they represent, said the survey respondent. "We are the only game in town (250 miles from the next town) and also cover the emergency room. So if we don't see the patients in the office, we will see them in the ER. … So, I think counting us as likely to continue seeing Medicare patients is going to distort the point you are trying to make.

" … More FPs are going to look 'satisfied' with the reimbursement than specialists because specialists don't have ongoing relationships with patients to honor and often can just say no in a way that we can't. Don't let Congress get the wrong impression about the Medicare rates. If we had as many Medicare patients as a lot of other parts of the country do, we would be bankrupt."

Moreover, the decline in Medicare payment will have a ripple effect across the health care community, observed another survey respondent who said he saw few Medicare patients in his public hospital.

"As private physicians opt out of Medicare because of the fees, it's possible that our percentage of Medicare patients will increase," he wrote. "This is a problem … because we're already struggling with more patients than ever. Yes, I hear the economy is doing well; however, a strong market that doesn't increase jobs that provide health insurance (absent universal access) -- which is what we have -- means more business for us. Most of our funding comes from Medicaid, and that's being cut. So the addition of Medicare patients to an already strapped safety net system just is not going to help."

Another survey respondent noted that Medicare sets the payment trend for all other reimbursement.

"Private insurance (plans) tend to reimburse based upon Medicare's rates," the member wrote. "While reducing one's Medicare patient numbers may help, it will not solve the larger problem that family physicians are poorly reimbursed. It is becoming more and more difficult just to stay in practice. Medicare reimbursements are just the tip of the iceberg."

Equally troubling, TRICARE, the military health plan, follows Medicare's payment example, noted a family physician in the military.

"The TRICARE reimbursement rates are directly tied to the Medicare rates," the respondent wrote. "Thus a relative or actual decrease in the Medicare reimbursement is also a reduction in the TRICARE rate, thus directly affecting all the military retirees, not just those over age 65. This similar reduction in reimbursement also limits the number of military retirees that a civilian family physician would want to accept onto his/her patient panel as well."

AAFP conducted the survey in February to determine the financial effect of expected Medicare cuts on physicians' ability to continue caring for elderly and disabled patients. Under current law, Medicare would reduce physician payment by an average of 4.8 percent each year for the next six years. A 2006 pay cut was averted in February when Congress restored Medicare payments to 2005 levels as part of passing the Deficit Reduction Act of 2005.

Without changes to the law, physicians would see a total 34 percent pay cut from Medicare during the next nine years, according to the AMA.