Home / Opinion / Doc: Opting Out of the Third Party System Will Save the Doctor-Patient Relationship

Doc: Opting Out of the Third Party System Will Save the Doctor-Patient Relationship

By Richard Amerling, MD

Now that Patient Protection and Affordable Care Act is the law of the land, we need strategies to safeguard the doctor-patient relationship from government intrusion.   The most effective approach is for both patients and physicians to opt out of the third party payment system.

From the patients’ perspective, opting out makes sense.  Insurance companies will not be allowed to deny care for pre-existing conditions.  Thus, even if the individual mandate is not thrown out on constitutional grounds, it will be smarter to pay the penalty, not buy insurance, and put as much money as possible into a health savings account.   Prompt excellent medical care can readily be found in the burgeoning free market.   Prices should be transparent to facilitate comparison shopping.

Physicians have an ethical obligation to use their skills and training for the betterment of our patients, and to pass this art to the next generation.  For those who choose to remain in practice, opting out of third party payment will be an increasingly attractive option.

Accepting payment directly from the insurer is a relatively recent aberration in the long history of the profession.   There was never a crisis in access to doctors’ services in the pre-Medicare/Medicaid era.   Physician fees were usual, customary, and reasonable.  Doctors charged well-heeled patients a bit more and those less well off a bit less.   Pro bono care was a part of every practice.  There was, and still is, competition between physicians for patients, and this restrained charges. Patients valued the doctors’ time and vice verse.  Doctors worked exclusively for the patient and were their strong advocates.  There was a high degree of trust and medical care was used selectively.  Direct third party physician payment changed all of this for the worse.

Initially, doctors “accepted assignment” as a courtesy.   Medicare eventually required participating physicians to agree to this.  Over the years, it became the norm. This was, in some ways, convenient to patient and physician. But by insulating both from the true costs of care, it led to overutilization and massive increases in health care spending.  Payers responded with price controls and attempts to micromanage medical decision-making such as managed care, and its new version, pay-for-performance.   Price controls on physicians drove volume increases that resulted in overall spending escalation.  Higher volume inevitably impacts quality of care.   No “quality improvement” measures can adequately compensate for this.

Widespread opting out of the third party payment system will lead to lower utilization with huge cost savings.   There is no more efficient model than direct pay since it eliminates the middleman for the majority of charges.   Office costs are dramatically reduced when third party billing is abandoned.  By setting their own rates, doctors will be in control of their time and patient volume would decrease.  Quality of care would improve, again saving money.  The doctor-patient relationship, arguably the essential ingredient to cure and comfort, would be strengthened.

The immediate objection to opting out is that not everyone can afford to pay at time of service.  The same argument could be made for dental and legal care (Note the absence of crises in the delivery of cosmetic surgery, dental, veterinary, and legal care—all outside third party systems).   We have simply become accustomed to having “someone else” pay.

Another frequent objection is that some patients will not go for needed care if they must lay out money.   This is easy to assert and impossible to disprove, but should bureaucrats make these decisions?  This, plus unsustainable overuse of the system, are the inevitable alternatives.

Universal coverage will complete the move toward centrally-controlled care.    Practice will be directed (i.e. rationed) by federal committees using practice guidelines, “pay-for-performance,” and the electronic health record.  Individualized care and medical confidentiality will slowly disappear.  Importantly for the administration and Congress, more citizens will become dependent on government largesse.  Doctors and other providers will become government employees, and be subject to its whims.

It is now left to individual physicians and patients to act in their own interests, and to defend the medical profession and doctor-patient relationship from government intrusion, and ultimately, destruction.

It is time to opt out.


Richard Amerling, MD,is a nephrologist practicing in New York City.  He is an Associate Professor of at Albert Einstein College of Medicine in New York, and the Director of Outpatient Dialysis at the Beth Israel Medical Center. Dr. Amerling is the author of the Physicians’ Declaration of Independence.

One comment

  1. Joseph M. Scherzer, M.D.

    Here are just 3 provisions in the new health care bill that have played a role in my decision to close my medical doors if the bill is not repealed:
    1. “Payment Bundling – Authorizes the Secretary to expand the payment bundling pilot if it is found to improve quality and reduce costs.”
    [For those not familiar with the term ‘bundling’ it means that payment for two or more services performed simultaneously is much lower than if those services were performed separately (on different dates). E.G., if a doctor performs a surgical procedure at the same time he offers cognitive services (for a rash, for example) he will be paid as a ‘package’ with a significantly reduced fee. An office visit fee can be disallowed altogether.]
    2. They are going to have demonstration projects in up to 5 states, beginning in 2010, “to demonstrate the effects of moving from a fee for service structure to a global capitated payment model.”
    [In other words, as has been tried with HMO’s, doctors will be paid a flat fee per patient (per ‘head’) per year, irrespective of services provided. (In the past, money was actually confiscated from a doctor’s wages (by HMOs) if he spent ‘too much’ money on prescriptions for his patients.)]
    3. You may have heard (or read) comments by Obama’s cousin, Dr. Fox, who stated the plan will fine those doctors who refer out ‘too many’ patients. (It is specialists who cost money by asking for tests and procedures. The government prefers to ration care at arms’ length, by placing threats on the backs of doctors, so the feds can claim ‘plausible deniability.’)

    These disincentives, in addition to the potential for hundreds of thousands of dollars of fines for claims felt to be ‘miscoded’ by Medicare have made me say, “Enough.” I will be at the NYC Tea Party April 15. Joseph M. Scherzer, M.D., FAAD, (& Member of AAPS)
    Scottsdale, Arizona

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.