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Obamacare One Year Later: Happy Anniversary, Doctor

The health care law recently passed the one year mark. Opinions are mixed. (Photo: SAUL LOEB/AFP/Getty Images)

By Hal C. Scherz, MD

Twelve months after the passage of one of the most controversial laws in American history, healthcare is still an unsettled issue. Never before has a president needed to go around the country to defend and sell a bill that he signed into law. America has been subjected to a law that over 1000 groups, representing 2.4 million people has been exempted from because they discovered that they could not afford the increased costs associated with it. This is before the law has even gone into effect. The bitter irony is that many of these groups who have received waivers were the most vocal proponents for this law, including the SEIU. This is cronyism at its worst and just a taste of things to come when the Federal Government, under the watchful eye of the Secretary of HHS decides what treatments doctors may deliver to their patients.

As physicians, we are already beginning to see the profoundly adverse effects of the Accountable Care Act (ACA) on us and our patients.

This year, the Medicare SGR (sustainable growth rate), which required a 23% reduction in physician reimbursement, was postponed 5 times. The final reprieve, resulted in Congress “kicking the can down the road” until January 2012, when the reduction becomes 29%. Meanwhile, the new Medicare fee schedule goes into effect in October, with across the board cuts of approximately 7%. During 2011, CMS (Centers for Medicare and Medicaid) withheld payments to physicians on TWO occasions, for as long as 45 days. This presented tremendous hardships for doctors whose practices are largely made up of patients on Medicare and where these payments represent a large portion of their income.

Many doctors needed to take personal loans to meet payroll. Many doctors did not take home a paycheck even though they had provided services. Some doctors needed to down size, which meant layoffs of employees, and still others needed to close their practices. And thousands of doctors, who have been caring for Medicare patients for over 40 years, simply had enough and either stopped taking new Medicare patients or left the Medicare system entirely. And who could blame them? Any business needs to have some degree of predictability in order to survive, and Medicare has become too unpredictable to base future decisions upon.

The losers are not so much the doctors as are the seniors. They have paid into a system during their working lives, and now many struggle to find a doctor. With $500 billion slated to be cut away from Medicare, the benefits that seniors will receive will diminish as well.

The care that these seniors and others receive will not be as good as the care that patients currently get. One reason is that the ACA makes it easier for non- physicians to deliver healthcare. The new law emphasizes the concept of “medical homes”, which will be the gatekeeper in future healthcare delivery models. Nurse practitioners and physician assistants are elevated to physician status by virtue of this law. It is the attempt on the part of the federal government to convince the public that there is equivalency between all healthcare providers, but sadly that is just not so. It is the beginning of the attempt on the part of the government to condition the public for a lower standard of healthcare. This statement is not meant to be derogatory to this group of professionals, but simply stated, they are not doctors; they are physician extenders. It takes 7-15 years of education and training, long hours and personal sacrifice to become a doctor. A physician cannot simply be created by a legislative edict.

Yet, this is precisely what is happening around the country. Clinical psychologists in California are being giving hospital admitting and prescription writing privileges, optometrists in some states are given eye surgery privileges, including laser surgery privileges in Oklahoma, and nurse anesthetists are designated as equals to board certified anesthesiologists. Pharmacists are lobbying for the ability to change prescriptions written by physicians not to generics, but to entirely different drugs, if they think that it is warranted. And nurse practitioners are now able to do an extra year of training and come out with a doctorate degree in nurse practice, so that they can call themselves “doctor” as they populate primary care clinics and medical homes.

The HITECH Act which was actually in the Stimulus Bill of 2009, was essentially activated by passage of ACA, so that now, all doctors who wish to receive the highest levels of reimbursement for the services that they will have already provided, will need to have a health information system in place that meets federal standards. This is not an entirely bad concept, were it not for the fact that the systems currently available are not yet ready to accomplish the integration of clinical information between doctors, hospitals, pharmacies and other sectors of the healthcare spectrum. We will get there at some point, but to force doctors to spend money now on systems that cannot meet these goals is absurd.

The systems are pricey, and the costs cannot be passed along, so doctors have to assume them all themselves. Consequently, less money will be available to spend on patients whether that means fewer personnel in doctors’ offices to care for them or less sophisticated tools available for the doctors. The systems that doctors are being forced to adopt will soon be surpassed by better systems that will be developed that can do what we expect from them, and then doctors will have to incur the costs to retool their offices once again. The problem is that when the technology is developed, every doctor will want to adopt it and not before, just because it has been decreed. The money that is supposedly available to doctors who implement these systems and who demonstrate “meaningful use” will barely cover the incurred costs, assuming that there is money available to begin with.

The government and insurance companies are looking for alternative healthcare delivery models and the ACA supports one such model- the Accountable Care Organization (ACO). This organization is intended to be a vertically integrated healthcare delivery system consisting of physicians of all specialties working together, by following clinical protocols and best practice models, so that care can be coordinated and waste can be eliminated, while delivering improved care. This medical utopia would work with the hospitals as partners, but what is instead happening around the country is that hospitals are buying up physician practices at a record pace so that they can control as many patients as possible and hence control the medical market in their community.

The physicians in this “super HMO” are employees and they then have to choose between doing what is right for their patients and what their employers instruct them to do. This is already happening in hospitals across the country, but will escalate as more physicians, especially specialists, leave private practice because they fear that their practices will have no value if the hospitals control the flow of patients to them.

Besides encouraging the formation of ASOs, the ACA has other provisions which are aimed directly at doctors, in an attempt to destroy the private practice of medicine; a necessary first step to get to a single payer, government run healthcare system. Working with a willing accomplice, the American Hospital Association (AHA), provisions were put into the ACA that eliminates future physician owned hospitals and surgery centers, imaging centers and laboratories. The exemptions to these ventures occur when they are connected to and are a part of the physicians’ direct practice, but these exemptions are being challenged as well. The AHA is a very powerful lobby and as we have come to see, doctors have no effective lobbying group and are easy targets for every group that wants to push us around.

Finally, the worst part of the ACA lies in the limitless power granted to the Secretary of HHS when it comes to healthcare matters. The Secretary determines what the clinical protocols are which doctors must follow if they wish to see patients who have insurance that is offered through the healthcare exchange. According to the ACA, there will be no insurance offered outside of the exchange. So if you want to see insured patients, you must follow the protocols approved by the HHS Secretary.

If this wasn’t bad enough, the Federal Coordinating Council for Comparative Effectiveness, a 15 person board appointed by the President and with no Congressional oversight, will decide what treatments doctors may offer to patients and which cannot. Simply, this is the beginning of medical rationing, and if the issue of waivers bothers you, then this should really scare you. “trial balloons” have already been sent up in this regard. We have seen it with mammogram recommendations and with limiting Avastin for breast cancer patients. You can be certain that It will escalate as new ways to limit care are explored.



Dr. Scherz is the Founder and President/CEO of Docs 4 Patient Care (www.docs4patientcare.org).




  1. God bless those physicians fighting the battle for Medical Freedom… I thank all of you for sacrificing your time and treasure to the greatest cause that ever was or will be.

  2. In 2010, Medicare reimbursements to cardiologists were cut by 20% or more with 60 days notice. Combined with the lack of payment for 45 days, all of the severe consequences Dr. Scherz took place. If reimbursements are cut an additional 29%, those remaining in private practice will have no choice but to close their doors. This is the plan. Less access = lower costs.

    Actually, less access means sicker patients, longer waiting times for appointments, and higher costs, since hospitals are allowed to charge facilities fees for testing. Many patients already are seeing their bills skyrocket, when they get outpatient care from hospital employed physicians.

    Unfortunately, bankers, service providers, IT people do not care that Congress happily will slash payments to the point where only bankruptcy is an option. They expect to be paid and will extract their pound of flesh.

    That banks that gave mortgages to people who could not afford them get loans from the feds of .01%, while doctors taking care of very sick people are crushed, says a lot about our society.

    Congratualtions to Dr. Scherz for his superb commentary. Now get yourself on Kudlow and other news programs now. This story has to be told. You are preaching to the choir here.

  3. I will reply to the 2 previous comments by Rodriguez and McDonald. First of all, discrediting Dr. Scherz for using the phrase “Obamacare” is a weak and overused rebuttal. I do not wish to waste time reminding those Americans who actually paid attention of the disgraceful process by which the president and his congress passed this legislation into law. Since this is his long-awaited, ‘”signature” legislation and he is proud of this monumental achievement, I believe he “owns” it and the term Obamacare is therefore, not a pejorative term. Even liberal economist and author Paul Krugman refers to the HC law as “Obamacare”, yet no one seems to find fault when a liberal from Princeton uses the term.

    Secondly, I would argue that your claim that the inception of Medicare and Medicaid in the 1960s has not resulted in the “end of the world” is historically wrong. Yes, in it’s literal sense, we are all still here, however, every healthcare expert on both sides agrees that many of the problems we now face in our HCS have evolved over the last 45 years of government intrusion (Medicare/Medicaid and price controls) into the doctor-patient relationship and the method by which Americans pay for healthcare. I would guess that most American taxpayors would agree that $38 Trillion in unfunded Medicare liability is a pretty dire scenario.

    Third. The argument that “fee for service” reimbursement is an issue is debatable at best. Procedure-oriented doctors do get paid for procedures because that is what they do. Surgeons get reimbursed for performing surgery just like psychiatrists get paid for listening to their patients. I would argue that it is a misrepresentation to claim that doctors “do more to make more”. With scrutiny and pre-certification by 3rd party payors/physician peer review and anti-trust laws for self-referral, many of these types of physicians have been eliminated from practice. Additionally, if our HCS went to a more patient-centric, consumer-driven insurance marketplace where people “owned” their policies, picked the benefits and combined them with a high deductible, catastrophic policy inside a health savings account(HSA), you would see your claim of unnecessary, overutilized procedures be reduced dramatically since patients would actually be making personal healthcare decisions based on cost. This price transparency and “skin in the game” is totally absent in today’s system.

    Fourth. The claim that 50 million Americans are without health insurance has been disproven by numerous reliable sources and for brevity, I will not breakdown the numbers here. However, the actual number of Americans who are “chronically” uninsured is in the range of 12-15 million.

    Fifth. Another rhetorical claim which is completely false. The same “50” million Americans know too well that they can get healthcare and medical treatment for “free” by walking into any hospital emergency room. Being a “practicing” hospital-based specialist, I know first hand that the homeless man with no insurance gets the same level of comprehensive, high quality care as the patient with the best private insurance. Yes, they may not have immediate access to office-based care due to their “uninsured” status, however, the ER is their safety net and there are numerous community health centers that many of the uninsured do not take advantage of. The creation of EMPALA legislation by the fed government assures that no one can be turned away for medical treatment.

    It’s obvious to me that the above response was made with no fundamental knowledge of the many provisions in the PPACA that will be detrimental to the doctor-patient relationship and the future quality of American healthcare. In fact, despite the lofty claims, the law actually exacerbates the problems we currently have and will destroy what actually works well. Yes, the current system needs an overhaul, but since the legislation was written by bureaucrats and attorneys, rather than considering physician and patient input, it is doomed to fail. if Dr. Rodriguez took his Hippocratic Oath seriously and actually bothered to read the law, he would feel obliged to speak out against it’s implementation on behalf of his patients who will clearly be harmed by this law.

    As a physician, I acknowledge and am grateful for the many things I have learned and continue to learn from the nurses I have been fortunate to work with over the years. Having said this, there simply is no time or space to dispute Ms. McDonald’s positions. I do agree that there are excellent nurses and lousy doctors in our communities. The fact remains that there is minimal comparison to the level of study, responsibility, years of emotional/financial committment and liability between the 2 professions. The medical model of patient care includes all of us working as a team and will not evolve into one that replaces the physician as leader of that team. I also seriously doubt that patients will readily make the distinction between their nursing “doctor” and their physician, nor do I believe that most RNs will divulge that fact voluntarily. No other professional would allow their title to be hijacked by others who happen to be in the same industry. Paralegals do a lot of the basic, mundane work of attorneys and I’m sure know quite a bit of law, but clients do not call them counselor. My friend has a pilot’s license, yet I do not refer to him as Captain. I contend that if RNs want to be called “Doctor”, then they need to achieve the rigorous standards for acceptance to medical school, spend the $250K in education expenses, committ to the 10-15 years of study after graduating high school and accept the personal liability and continued personal sacrifice that is required for the remainder of their career.

  4. Richard A. Armstrong MD

    In response to some of the comments above: First, you should be afraid of both Medicare and Medicaid. They are poorly conceived, fiscally unsound and failing programs. Medicare alone has $38 trillion of unfunded obligations and there is no money in the “trust fund”. All payouts currently are covered by treasury bond IOUs as the federal debt continues to rise. All Americans, not just physicians, should be concerned and physicians should lead the reforms,not just beg for a seat at the table.

    Medicaid is a giant bureaucratic mess and is also the budget buster for every state, and yet the PPACA uses this failing program to expand “insurance” to more than 18 million new people. State governors will tell you uniformly that this is not workable for them.

    Yes, there are good physicians and others working in HMOs, however, the ACO concept is ethically unacceptable for a very clear reason; the physician ceases to be a patient advocate and becomes a bedside rationer of care…for who? For the bonus promised by the ACO for limiting spending on patient care. This should be unacceptable to all physicians who consider themselves patient advocates first and foremost. The PPACA destroys the physician-patient relationship instead of strengthening it.

    The name Obamacare was earned by this President who truly owns this law. Even Paul Krugman uses the term so I would simply say that the word is much ado about nothing.

    The PPACA is the largest piece of social legislation in the history of this nation passed by a hyperpartisan vote. The only thing that was bipartisan about this was the opposition. This is for a very good reason. The law fails to address the root problems with our health care system and effectively places the entire health care economy in the hands of a single unelected bureaucrat, the Secretary of HHS. This is a poorly conceived law that is dangerous to American medicine and to American patients. It needs to be repealed and replaced by common sense reforms that are designed and led by the majority of working physicians in America who were simply not included in the debate that proceeded the passage of this law.

  5. Although your article is largely informative and addresses valid issues regarding the “Obamacare” health reform, I would like to take a moment to address a few miss-leading facts regarding “non-physicians.” Stating that seniors will be the “losers” in this health reform due to the fact that the care that they will receive from these “non-physicians” will be “not as good” is a misrepresentation of the excellent care provided by nurse practitioners and physician assistants. You stated that you did not wish for your statements to be taken as “derogatory,” but they were exactly that. I am currently in a Doctor of Nursing Practice program and I do take offense to some of the statements in this article.

    Currently nurse practitioners can have either a master’s or doctorate, however, by 2015 it is the intent of the American Association of Colleges of Nursing (AACN) that all master’s programs will have transitioned into doctoral programs (2010). The movement to the DNP is not about nurses wanting to call themselves “doctor,” it is about meeting the nation’s healthcare needs by producing the most competent clinicians (AACN, 2010). Nurse practitioners are state licensed and nationally certified and the schooling involves much more than “an extra year of training.” It requires at least four years for an ADN or BSN, then another 2 – 4 years for either an MSN or DNP. Extensive practicum is required, typically in a specialty area such as pediatrics, neonatal, mental health, and gerontology, to name a few. Twenty-seven states require NPs to practice in collaboration with an MD and at least eleven states do not even require any physician involvement at all (Christian & O’Neil, 2007). Simply stated, yes, a nurse practitioner with a Doctor of Nursing Practice degree is a “doctor,” but of nursing, not medicine therefore not a physician, and most certainly not a physician extender. Nurse practitioners are independent practitioners, not the extension of anyone.

    Furthermore, the federal government is not “attempting to convince the public that there is equivalency between all healthcare providers,” the public is discovering that all by themselves. According to many scientific studies conducted over the last decade, it has been found that care by Advance Practice Registered Nurses (APRNs), such as nurse practitioners, is as good as or better than that of physicians (Do Physicians, 2008). In a study conducted in 2004, the outcomes of the care in patients randomly assigned either to a physician or to a nurse practitioner for primary care after an emergency or urgent care visit were explored (Mahar, 2010). The researchers determined that the health status of the NP patients and the physician patients were comparable at initial visits, 6 months, and 12 months. A follow-up study conducted two years later showed that patients confirmed continued comparable outcomes for the two groups of patients (Mahar). There are many other studies that show similar data, which clearly shows that the public is not in for a “lower standard of healthcare.”


    American Association of Colleges of Nursing [AACN]. (2010). The Doctor of Nursing Practice Fact Sheet. Retrieved from http://www.aacn.nche.edu/Media/FactSheets/dnp.htm

    Do physicians deliver better care than Advanced Practice Registered Nurses? (2008). The Center for Nursing Advocacy. Retrieved from http://www.nursingadvocacy.org/faq/apn_md_relative_merits.html

    Christian, S., Dower, C., & O’Neil, E. (2007). Overview of Nurse Practitioner Scopes of Practice in the United States – Discussion. Retrieved from http://www.acnpweb.org/files/public/UCSF_Discussion_2007.pdf

    Mahar, M. (2010). The Battle over Letting Nurse Practitioners Provide Primary Care. Taking Note. Retrieved from http://takingnote.tcf.org/2010/04/the-battle-over-letting-nurse-practitioners-provide-primary-care-.html

  6. Whenever an article starts with the phrase: “Obamacare”, watch out. There are loads of problems that the new Act presents to the Public and to the people who provide care, especially Physicians. But all is not bad in this big change. The issues Dr. Scherz discusses in his the sky is falling article have been challenges for Physicians for years and in a democratic society it is important to face up to power of your opposition with your own power to combat what you believe is wrong.
    Maybe it is a bad policy to create ACO’s, but frankly they are being created in order to continue what is a failed process of reimbursement in my opinion, “fee for service”. This form of payment creates an incentive to increase the numbers of procedures because that is the way a person gets paid by procedure. The ACO, that no one outside of the rooms in which CMS, HHS and others are working in really knows what is going to happen. But what is clear that they want to try this and there are those who are working in it that are Physicians and people who work with and for Physicians. There are people who are afraid and partly because its unclear, partly I believe because the policy is half-baked, but most of all because change is so frightening in the healthcare process of providing medical care. Its so darned disorganized and so unmanaged as to be a matter of luck when someone gets treatment that is cost effective and driven by quality. Sure there are many many places in which medical care is outstanding and cost effective. But more so in our Country people think that when I spend more money for medical care I must be getting better care and that’s just no so.
    Yesterday a Physician had to be weary of hospitals because they have a different focus then a private physician and some of their reason for being is opposite from a doctor who works so hard to protect and treat her or his patients. An HMO is a business that has to be watched both by government and by each Physician who works with them, but believe it or not there are good people who work in HMO’s and the philosophy is sound if properly handled by people who want to do well while they do good.
    I’m not afraid of the new Act. As I’m not afraid of Medicare or Medicaid and Lord knows that there are still many problems with those two insurance systems. But the world did not end after the 60’s when they became Law and the World will not end as this Act is rolled out over time.
    There are 50 million people who work, who don’t have healthcare insurance which means that they have minimal access to healthcare and medical treatment. I’m glad we as a nation are attempting to catch up to other countries with this law and I’m happy that we’re heading down this road.
    But I’m not complacent, there are loads of issues that the Doctor has, some of which I would argue are not well-founded, but go to it, but don’t call it Obamacare. And understand that there 16% of the population of this country have names like mine and they and others will be protected and served by this new Law and I thank the President and Congress for doing what others could not accomplish.

  7. Dr. Scherz, you are on the money. The present administration sees physician income as the easisest target when trying to reign in costs. The administration will not do battle with the well-organized lobbys of hospitals, insurers or big pharama. Rather, the government will force physicians to become underpaid employees of these organizations. As seen in the 90’s, employed physicians are employees. The 60 hour week will become 40. While cost savings might occur, it will be directly on the back of physicians who will make less and ultimately do less. Patients will find access to care more difficult. With access to care limited, costs will certinaly go down….and the Washington bureaucrats will claim victory.

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