By Alexander Sapega, M.D.

Published November 1998

• React to this article in the Discussion Forum.

From that point on, I had to demonstrate to my patients the value and worth of my services on a daily basis. I was dependent upon them to pay me directly, as the Blue Shield checks would no longer just roll into my office irrespective of whether or not the patient was pleased with my competence or manner. While unsettling at first, this helped me become a better, more patient-oriented physician and reduced the adulterating influence of the third-party payer system on my physician-patient relationships. It also gave me the courage to resist the subsequent onslaught of Act 44 and the cut-throat managed care insurers. Without question, I have lost prospective patients who were looking to be treated by a lower cost physician, but on the whole I have survived quite well. I must say that I have never even looked back. Given the inequities of Blue Shield reimbursement eight or nine years ago, it was no surprise to me to see their reimbursement policies now go from bad to worse (or from merely unreasonable to fiscally ludicrous). I do hope that my employees appreciate the freedom and flexibility that their health benefit plan (a Medical Savings Account plan rather than a traditional insurance product) affords them.

I have been saddened to see a once proud group of clinicians panic and flee first toward corporatization and now toward unionization, as opposed to simply sticking up for their own individual rights by way of "voting with their feet." It did not surprise me that much to see federal regulators recently frown upon the "messenger model," apparently viewing it as mere cartel-oriented collusion in sheep’s clothing. It is time that physicians turn to the basic principles of the marketplace, where they each must decide, individually, whether or not they can cut their standard of care and practice costs to a level that will allow a profit to be made at the new Blue Shield reimbursement rates. For each practitioner for whom the answer is "no," it is up to him or her to cast a vote to that effect in the marketplace by vacating his or her participation agreement with Blue Shield. This should not be done out of political or professional protest, but rather on the basis of a simple business decision. In a variation of that old adage "With friends like that, who needs enemies?" each physician will have to ask him or herself "With business like that, who needs a lot of business?"

Many patients will undoubtedly flock to the remaining participating providers, but it will certainly be a challenge for those physicians to serve them while providing the kind of expert and comprehensive care that patients deserve, simultaneous with paying their office overhead expenses. We should realize, however, that market principles dictate that if the remaining participating physicians succeed in that regard, then medical consumers (also known as patients) will say "more power to them," and the non-participators will have to accept the consequences. I, for one, am willing to continue taking that risk. I have come to know what patients want and need and I have postured myself to provide that for them. I cannot boast of a "high volume" practice, and I do not quite earn what the throw-away journals say is the average national income in my specialty, but nonetheless I feel I have prospered and I find my current practice extremely fulfilling. I thoroughly enjoy my independence from the manipulative tactics of managed care insurers, who blatantly use their large market share to subdue and distort normal individual consumer-producer behavior (perhaps the regulators will look into this at some point rather than just focusing on physicians’ behavior). I also greatly enjoy the extra time I have to spend with my children and pursue other interests.

While the political and economic forces that have been brought to bear on us might seem impossible to resist, if we have learned anything from economic history it is that artificially induced deviations from normal free market behavior are always temporary. Societal forces inevitably exert significant pressure against anything that enforces such deviations for very long (witness the demise of communism). The warp in the system usually unravels at some point.

The solution to physicians’ problems with Blue Shield lies not with state government or the Insurance Commissioner, who has appropriately indicated that if independent physicians are not satisfied with the reimbursements provided by Blue Shield, then they should simply not participate. That is the way the marketplace does and should work, and that is the way it will always work, so we might as well get used to it for better or for worse. Having to deal directly with patients regarding remuneration for professional services will make you work all that much harder to gain and maintain each of your patient’s appreciation and loyalty. Turning down the speed on your current practice "treadmill" by way of non-participation will, however, give you the time to do exactly that. You might enjoy it. You may even find that your patients will also value your services more if they have to give up that coveted lounge chair or that extra week of summer vacation that they had their eyes on in order to receive first-rate medical care from a skilled and dedicated practitioner of the art and science of medicine. It will be up to you to convince them that they made the right choice. Each of you individually and privately must determine what your choice is going to be in this matter. The collective result will largely dictate the conditions under which medicine will be practiced in the future.

The guiding principles to keep in mind are:

1. Never lose faith in free market forces and principles, as they are immutable and akin to basic human nature;

2. Give charity where it is due and do not give charity where it is not due; and

3. Do not look to government, the PMS, prospective practice buyers or unions for assistance; look within yourself.