Healthcare ReformsHIPAA / ACA / ACOPractice AdministrationRevenue Cycle Management (RCM)

Top 4 Reimbursement Questions Physicians must ask


With underpayments galore, and incentives that are not so very attractive, Medicare is proving to be adept at what it does best – lower the fees further with providers. Although the behemoth that Medicare is turns out in its favor while bludgeoning down physicians’ fees, it may turn out to be its Achilles heel after all. Here are a few reimbursement questions that physicians need to ask themselves.

Contending with the question of underpayments

Underpayments are the bane of practitioners and hospitals, especially when Medicare reimburses just about 81 and 71 percent respectively of prevailing private rates. With Medicaid, it is worse at a dismal 56 percent. With such low rates approved by the Federal government, it is a losing proposition for most hospitals. According to American Hospital Association’s data compilation, hospitals are consistently losing with Medicaid and Medicare patients.

Rates not keeping up with galloping inflation

With inflation looming large on the horizon, Medicare’s national regimen of reimbursement is far behind, and not keeping up with the rate of inflation. With staffing costs and overhead expenses mounting relentlessly, physicians need to work extra hard to see more patients in order to maintain the balance. If the same scenario continues, resources will become scarce, leading to a marked decline in care. The sustainable growth rate (SGR) maintained by Medicare for physician reimbursement is woefully inadequate and needs to be reworked.

More regulations are a burden

There is no denying the fact that the health care sector is burdened with most number of regulations already, and can ill afford further regulations. Although these regulations are formulated by the powers that be with the best of intentions, they ultimately do more harm than good, ultimately jeopardizing patient care. This often leaves doctors with less time to devote to their patients. Further reforms in the healthcare sector will certainly not help reduce such regulations.  Legislation can only lead to increased red-tapism, what with a plethora of agencies, committees and bureaucracies coming between the doctors and their patients.

VBPM – Value Based Payment Modifier

Protection and Affordable Care Act (PPACA) has established the Value Based Payment Modifier (VBPM) under section 3007 of the Act. This helps in adjusting physician reimbursements based purely on quality of care given, as per the definition of the Secretary of Health and Human Services (HHS). This lays the arbitrary cut-off that is acceptable to physician costs, and those going over this threshold are liable for punishment. This can only penalize physicians who do not conform, leading to dissatisfaction as it will put tremendous pressure on them. With the threat of recrimination looming large, doctors will find it rather difficult to practice medicine in a healthy manner.

General shortage of physicians

Patients will have to contend with increasing decrease in the supply of physicians, thanks to the new set of regulations, stubborn bureaucracy, burden of extra paperwork, and decreasing autonomy leading to a general sense of dissatisfaction in the job. This could lead to several doctors putting in their papers earlier than necessary, or looking for alternative careers.  If healthcare reforms were to be pushed forward aggressively, the number of doctors wanting to stop practicing medicine is set to increase drastically, leading to an acute shortage, which can be catastrophic.

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