A Slap In The Face

July 13, 2007
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R. Troy Carlson is a small-town doctor with a big-time ailment. What ails him is the manner in which state legislators have handled, or maybe more aptly phrased, not handled the budget crisis.

Even though lawmakers avoided cutting Medicaid reimbursements by another 6 percent for this fiscal year, Carlson diagnosed the political rhetoric oozing from Lansing regarding smaller payments as insulting to primary care physicians.

“The financial hit that doctors are going to take is really not that much different than where (the reimbursements) are now. But the fact that they’re considering a cut in the advent of all that we’re already doing is really a slap in the face,” he said.

“I feel this is kind of a war situation, as we’re using people as capital in this thing.”

Carlson is a partner with physicians Matt Garber and Scott Randall in Family Tree Medical Associates in Hastings. As the name implies, the three are board-certified family physicians. The practice has been in business since 1999.

Carlson is president of the Barry Physicians Alliance, which represents about 20 primary care doctors and 20 specialists who practice in the county. He is a member of the physicians board at Pennock Hospital. He negotiates policies with insurers and said he is “privileged” to provide care to his patients.

But Carlson also said he probably sees medicine from a different perspective than most physicians, as he knows how much it costs him to deliver care when a patient walks into his office. He called himself Family Tree’s de facto business leader, and is fully aware that the practice has a bottom line.

“So that can be a blessing and a curse in terms of understanding what we need to do economically, as primary care physicians, to allow us to continue practicing medicine within an ever-changing world and the business atmosphere of medicine,” he said.

Part of that atmosphere has payers and insurers trying to reduce their costs in an industry where prices have become exorbitant. Carlson said those movements have squeezed revenue for primary physicians. Another part of that current business atmosphere hangs like a storm cloud over Lansing, where Gov. Jennifer Granholm and legislators haggle over tax increases and spending cuts for this year’s and next year’s general budget.

Granholm said Medicaid reimbursements would have to be cut on June 1 unless a budget agreement was reached by then. It was, so those payments will remain at the current level at least through September. But that’s not exactly good news.

Carlson said it costs Family Tree $55 for a routine office visit, a reasonable amount when compared to larger cities. But Medicaid only reimburses his practice $30 for each routine visit made by a Medicaid patient.

“Right now, Medicaid would have to be overhauled and actually double the amount of resource allocation to get us up to speed to where we need to be just to break even,” he said.

Medicaid and its various versions cover about 600 of Family Tree’s 8,500 patients, roughly 7 percent. But charges billed to those insurances are about 13 percent of the practice’s total annual billings, nearly twice the Medicaid patient load.

“You almost double the use in terms of charges. What it meant to our office in 2006 is we billed about $140,000 worth of charges, and we got paid about $43,000. It’s about a reimbursement of 39 or 40 percent,” he said.

Carlson isn’t political by nature, but he has spoken with legislators and has a connection in Lansing. His brother is chief of staff to House Speaker Andy Dillon. He has talked with past 87th District state Rep. Gary Newell and current state Rep. Brian Calley about the damage further cuts to Medicaid would do to his practice.

He also told state Sen. Patricia Birkholz what lower Medicaid reimbursements have cost Family Tree when those payments are compared to the amounts Medicare pays.

“In our office we gave away roughly $30,000 worth of free care last year. That’s what Family Tree gave away in the difference between Medicare and Medicaid,” he said.

Carlson explained that the payment gap creates an access problem. He said no one in Barry County is actively accepting new Medicaid patients because of the reimbursements. They are continuing to see previous Medicaid patients.

“We all believe that serving those less fortunate is responsible. I don’t think anybody, generally speaking, in medicine doesn’t believe it. And yet, we’re not even doing this for free. It’s costing us $25 a time to do this at that level of a visit, and now you get the drift of why doctors aren’t accepting this,” he said.

For state leaders to get that drift, Carlson would like to see them go on Medicaid for three months. If they did that, he said, they would have a clearer grasp of what doctors and patients go through. Then cuts to Medicaid wouldn’t be made, and they’d have a better appreciation for the work primary physicians do. Carlson, though, isn’t holding his breath for that to happen.

But he does think the state can do more than it has done. Carlson feels state officials can share in some of the loss small practices like his incur. He’d like to see a tax exemption or credit given to doctors working in the Medicaid trenches. If that doesn’t happen, he thinks those trenches might be empty some day.

“Instead of me paying $13,000 in the Single Business Tax for my $30,000 gift, which I did last year, they would be able to offset some of the giving that we do. Doctors haven’t been really good at sharing that; we all kind of just feel that way,” he said.

“I will share with you that the lion’s share of the work is being done by primary care physicians, and guess what? People aren’t going into that field.”

When Family Tree opened for business eight years ago, the practice accepted Medicaid as payment, and Carlson said the state assigned his business 300 of that plan’s patients in just a month’s time, with some living up to 80 miles away.

Since then reimbursements have fallen and fewer doctors are accepting Medicaid as a form of payment. The Michigan State Medical Society reported two years ago that two-thirds of its 14,000 member physicians were seeing Medicaid patients. In 1999, when Family Tree hung its shingle, the society said 90 percent saw Medicaid patients. Carlson felt that Medicaid patients might have had even fewer physicians to choose from had the state cut reimbursements in June.

“I would advocate that all physicians discontinue their participation with Medicaid, if this cut had gone through, to share with the Legislature and everyone around here that this is malarkey. Not because we’d be doing it for more money, but that the access issue is real, and now you’re going to have to pay six- or eightfold the cost of care through the emergency departments. This affects all of us, it affects all of us,” he said.

“But that’s not in my heart,” added Carlson about not providing care to Medicaid patients. “I feel that way, but what other way is somebody going to get it?”    HQ

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