The Bucks and the Docs

December 23, 1998

As both a physician and one who supports the United States (by accepting its obligations in lieu of payment) I have an interest in Medicare.

Most government programs exist for a purpose, which is rarely disclosed. The ostensible reason for any given program is usually some heart-warming sentiment, such as "providing for our older citizens' retirement," or "ensuring a quality education for our young people," or "protecting the environment." What is the ostensible purpose of Medicare? I asked the Health Care Financing Administration, and was referred to its website, particularly the MISSION and VISION sections. Under MISSION, HCFA states, "If we are to be successful in meeting our current and future challenges, we realize that fundamental changes need to be implemented within HCFA. First, we need to clearly articulate our role as an organization, as follows: We Assure Health Care Security for Beneficiaries. Health care security means: access to affordable and quality health care services; protection of the rights and dignity of beneficiaries; and provisions of clear and useful information to beneficiaries and providers to assist them in making health care decisions. In serving the health care security needs of beneficiaries, we work together as a team and in partnership with others, and value the contributions each of us makes." Gosh. I still don't know what Medicare is for. How about VISION? "If we are to be successful, it is imperative that we look forward as clearly as possible to develop a picture of where we hope to be in the future; how our responsibilities will change, who will be the beneficiaries we serve, and what will be their needs. Building on the mission of HCFA, we have defined our vision of HCFA's future role as: We guarantee equal access to the best health care. The vision reflects our commitment that: all individuals will be given an unconditioned assurance of having the same opportunity to have their health care needs met, regardless of location, income, or other circumstances; and the quality of health care they receive is the best that can be provided." This, of course, is impossible, and always will be.

So what IS the purpose of Medicare? Simple. Judging by its actions, as against its rather flowery and not altogether believable rhetoric, its purpose is to destroy the private practice of medicine, and make medical care ever more expensive.

Some may object that the purpose of Medicare is to pay for health care for the elderly. That, however, is not a stated goal according to HCFA. Isn't it remarkable, moreover, that there should be such a program to make medical care more affordable for people who have spent their entire adult lives working in the most prosperous country in the world? They should be the most, not the least, able to afford anything. Besides, Medicare pays just as much for the medical care of a millionaire as it does for a pauper. Moreover, if payment of the medical bills of the elderly were its purpose, Medicare could simply do it. In other words, an older person could send his doctor and hospital bills to Medicare and be reimbursed, at whatever level, and by whatever method, Medicare has chosen. But that won't work. A patient who submits his medical bills to Medicare will not be compensated. That worked in the first few years of Medicare's existence, when the doctor (for example) merely had to provide the patient with an itemized bill, but no more. Today, the patient will only be paid if the doctor submits the claim. This is an important fact, because it demonstrates how Medicare works: it places a wedge between physician and patient, making the patient's benefits dependent upon the physicians compliance with Medicare rules, which are capricious and changing. If the doctor doesn't knuckle under, his patient won't get paid.

Every medical procedure has a code number, and every medical diagnosis has a code number, and every injection has a code number. These numbers are published in books (copyrighted by the AMA) and they are changed from time to time. The books must be periodically repurchased by the physician's office in order to keep current with the proper code numbers. They're expensive.

Moreover, each code number is associated with other factors, such as frequency of service. If, for example, you have abnormally high intraocular pressure, you are at risk of developing glaucoma. The code number for the diagnosis of "glaucoma suspect" is 365.00. Although ophthalmology texts advise pressure checks quarterly if this condition is to be adequately monitored, Medicare believes that visits to the doctor oftener than once every six months for this condition is excessive. Of course, it insists that the patient can be seen as often as necessary; however, more frequent visits will require documentation, such as the fact that the pressure has gone up to a dangerous level, or that medication, if being used, is triggering an allergic reaction and must be changed. There is no guarantee that such explanations will be accepted. "So what," you say. "All this means is that the patient doesn't get reimbursed." Wrong. It means that the physician will be ordered (!) to refund any payment he might have received for this "unnecessary visit," and the patient will receive notice that his doctor has overcharged him, and will be refunding his money. This is true even if the physician is "non-participating," and has no relationship whatsoever with Medicare. Civil penalties, including fines, can be levied against the doctor.

The code numbers are also linked to payment. Are there many Americans being forced by the government to work today for less than they received last year, or the year before, etc., for the same job? At one time, Medicare "allowed" a fee of 1800 for cataract surgery. Then it was inched down to 1500, 1200, 1000, etc. In 1998 it is 849, and next year it will be 829. The ultimate goal is a surgery fee of 600 for cataract surgery. This decision was made by some assorted "experts" consulted by the government who had never set foot in an operating room. Again, these numbers are not what Medicare will pay; they are what Medicare allows the doctor to charge. If the patient is a millionaire, and happy to pay 1500 to have his sight restored; no matter. The doctor who exceeds the Medicare allowable fee will be in trouble. So much for the right to contract! We wonder if many of the clerks at Medicare are receiving less pay every year for doing the same job.

The consequences of this are predictable: young doctors are eschewing solo practice, and joining groups. The groups are negotiating with large providers of patients. The practice of medicine is going the way of the family farm, which was replaced by agribusiness. The individual doctor today is being replaced by medibusiness. The Medicare paperwork (not to mention aggravation) of a large practice is not to be borne by a solo physician, and if the practice is small (such as mine) the competition from HMOs, PPOs, etc., is ruinous. Is it to the State's advantage to have doctors herded together into groups? Obviously, yes. If the MDs wish to prosper, they had better play by the rules, and the rules are easier to enforce upon a medical organization than upon individual doctors. It is a proven practice of government: consolidate and conquer.

The other obvious purpose of Medicare is to increase medical costs. Half of what Medicare spends each year is for its own administrative expenses. In other words, medical care costs half as much as Medicare spends; the rest is for clerks, office space, computers, etc. Eliminate Medicare, and cut medical costs in half! Actually, it would be more than half, because any service for which the cost is reimbursed, is a service that will be overutilized. I am old enough to remember the days before Medicare, and complaints of high medical costs were fewer than they are today, even though medical costs were often higher. For example, my pre-Medicare fee for cataract surgery was $350, (of silver) which, in terms of today's fiat, would be about 2400.00. However, I am not allowed to charge 2400, but 829! Better operation, drastically reduced fee, and complaints that medical costs are too high!

Medicare is a master stroke for the state. It justifies its own existence by pointing to the "high cost" of medical care, which has resulted, of course, from its own interference with the market. Government's acquiescence in the substitution of fiat for genuine money masks the fact that today's "unaffordable" medical care is, in many cases, much cheaper than the medical care it replaced, if costs are measured in the same units (which isn't a bad way to measure!) It provides employment for thousands upon thousands of workers who will fiercely resist any effort to trim, much less eliminate, Medicare. It has reduced an unruly horde of relatively affluent and independent contractors to subservient employees.

Medicare is modern fascism at work, and working very well!

A one-ounce gold nugget is rarer than a five-carat diamond.