More docs pass on insurance

A physician assistant of family medicine wears a stethoscope.

TEXT OF STORY

Lisa Napoli: Here's the latest twist on the health care crisis: doctors who are so fed up with the HMO system that they're not taking insurance any more.

Marketplace's Sam Eaton found a growing number are going cash-only.


Sam Eaton: It took Madeline Deutsch about three years working as a full-time ER physician in Los Angeles to come to this conclusion:

Madeline Deutsch: Patient care generally comes after a number of other priorities and I just was finding that I was just being less and less satisfied with my work.

In the maze of insurance forms and liability procedures, Deutsch says she lost touch with the reason she first became a doctor. That's when she decided to not only break out on her own, but to break away from the entire managed care system.

Deutsch: I wanted to bring medicine to the every person on the street at a reasonable cost that I felt was still a fair rate of getting paid for me and that would keep me happy.

Deutsch opened a bare-bones general practice in downtown Los Angeles about a year ago. Instead of accepting insurance, she charges a flat fee of $70 for annual checkups and basic office visits and up to $200 for more complicated health problems. She'll even make house calls.

Deutsch: It's only a couple of steps away from taking two chickens and some fresh cows milk down to old Doc Potter and Doc Potter's wife would be making cookies for you while you would be getting your tonsils looked at.

This out-of-pocket approach to health care has grown in recent years. The nonprofit Center for Studying Health System Change reports that 11.5 percent of U.S. physicians no longer accept insurance plans. That's up from about 9 percent in 2001. The center's president, Paul Ginsburg, says the reason is a matter of simple economics.

Paul Ginsburg: These physicians have been hurt and their incomes have been eroding. In fact, in real terms their incomes have dropped 10 percent over the last decade.

By some estimates, primary care clinics now need about six support staff for every doctor in order to process all the insurance paperwork and referrals. That makes it increasingly tough for family physicians to stay in the black. But insurers say their main responsibility is to keep patients' costs down. Susan Pisano is with industry's chief lobbying group, America's Health Insurance Plans.

Susan Pisano: Consumers benefit because the role of the health insurance plan is to negotiate with physicians and hospitals for rates that otherwise might not be available to individual patients.

State regulators are also worried about the trend, but for different reasons. Wisconsin Insurance Commissioner Sean Dilweg says as soon as patients step outside of an insured system, the state can no longer protect them.

Sean Dilweg: You're on your own as far as do the rates increase month to month, is the physician there when you need them. And if you have a dispute, you're then at the whim of your court system to resolve the dispute.

That's a tradeoff many are willing to take. Madeline Deutsch says even though her rates are significantly higher than the average insurance copay, the patients are lining up.

Deutsch: I get probably one to two inquiries a day and I'm scheduling four to five new people a week at this point.

One of those new patients is Jennifer Mohler. She has insurance but chooses to pay extra in order to see Doctor Deutsch.

Jennifer Mohler: I may have more of an expenditure at the front-end of health care, but when it comes to a long-term investment and a long-term payoff, there will be a benefit.

That benefit, she says, is having a doctor with more time to focus on prevention rather than paperwork.

In Los Angeles, I'm Sam Eaton for Marketplace Money.

About the author

Sam Eaton is an independent radio and television journalist. His reporting on complex environmental issues from climate change to population growth has taken him all over the United States and the world.

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