Why do doctors decide to go insurance-free?
To understand the insurance-free paradigm, you need to understand how health insurance pays the provider.Each year, doctors negotiate the price of treatment with insurance companies. For example, a doctor tells the insurer that when a patient visits his office, he charges $135 for an office visit. The insurer says, “We can pay you $85.” The doctor might counter offer and ask for $100. The insurer agrees to $90.
That very time consuming negotiation takes place with each insurance company for every service your doctor performs. It is estimated that for every provider who takes insurance, he/she will need approximately 15 support staff members. Ultimately, the insurance companies determine the amount they will pay a provider forcing providers to limit the amount of time spent with each patient. This has led to the 8 minute doctor’s visit that you may be familiar with. Dr. Pettitt is not bound by the limitations that insurers mandate.
She does not work for the insurance company… She works for you.
Another tactic that insurers use is to delay
payment. The insurer hires employees to comb through a provider’s notes and codes in order to reject a claim. Doctors must also purchase expensive software to bill insurers and hire billing and coding specialists to handle claims. If services are coded incorrectly, the insurer refuses to pay. It becomes a very expensive battle between doctor and insurer. When a doctor doesn’t agree to the insurer’s reimbursement rates, he/she can stop accepting that insurance or go insurance-free altogether.
“We used to submit a claim and two or three weeks later we got reimbursed. Then it became six weeks and ten weeks, and then they said they never got that claim even though it was sent electronically,” says Craig Koniver, an insurance-free primary care physician in Charleston, S.C., and author of “Connected: The New Rules of Medicine.” “Then we got notification they needed office notes to support the visit...It was little things that built up until we were spending a whole lot of time chasing down insurance reimbursements, which took away time from the patient.”
What about the rise of cash-only medical practices?
Have this happen enough and it's easy to understand why a doctor stops accepting insurance. Nearly 7 percent of 13,575 doctors surveyed by The Physicians Foundation said they will switch to a cash-only practice over the next three years, according to the report A Survey of America's Physicians: Practice Patterns and Perspectives.
In what's often called "concierge medicine," some practices charge an annual "membership fee" for services. For instance, for $2,500 a year patients receive the king's ransom in care, often including 45- to 60-minute appointment times, on-demand phone and email access and more. Others charge a typical flat office visit fee and provide the form for patients to file their own insurance claim.
An insurance-free practice can be an efficient strategy for some medical providers, but is it good for patients?
“…It certainly isn’t for everyone,” says Koniver. “If someone has a severe diagnosis or takes multiple medications or needs lots of office visits, they may do better with a traditional insurance-based system.” Likewise, people on a fixed income or those with very low incomes may have trouble budgeting the health expense.
On the other hand, it can mean patients are stuck trying to find doctors that will accept their health plans, it can mean a lot of frustration for the patient with chronic illness who is allotted 8 minutes per visit, or it can mean patients remaining sick, treating symptoms and putting bandaids on without every really treating the cause of disease.
"That’s how we are different. We spend the amount of time necessary to fully assess each patient so we can find and treat the underlying cause...And we can do this because we don't use an insurance based model of care." says Dr. Pettitt.
What options are there when your doctor doesn’t accept insurance?
“I tell my patients that medical insurance is like car insurance…” Dr. Pettitt says. “You use it when there’s an emergency, but you still need to provide gas, oil and maintenance for your car to run optimally. It is the same with your health. If optimal health is a priority and you want to see a Physician who does not take insurance, you will likely need to pay up front, then submit your insurance forms for reimbursement."
Another way to budget for visits to a cash-only practice is to take advantage of flexible spending accounts and health savings accounts (HSA). If you estimate your costs in advance and keep some money in an FSA, you can pay your doctor bill with tax-free money from this resource.
Data was extracted by author Jennifer Nelson, blogger for https://www.insurance.com and James Maskell, CEO of Evolution of Medicine.