This is the 3rd article in our series that explains how this uniquely American healthcare solution will provide universal access to care without relying on government and in a way in which everyone pays their fair share.
In our uniquely American healthcare plan, all Americans have an opportunity to choose a primary care physician and it is this choice that drives the entire healthcare system. At the outset, those physicians who intend to practice primary care medicine will be asked to formally register as a Primary Care Physician (PCP). In making this decision to be a primary care provider, the physician is declaring a willingness to accept responsibility for managing the overall health of each of his or her patients.
Physicians who are most likely to accept that responsibility and the designation of PCP will be family practitioners, general practitioners, pediatricians, general internists, and OBGyns. Some pediatricians, general internists, and OBGyns will opt to practice as a specialist rather than as a PCP. That decision has enormous consequences for the physician.
Once on the PCP panel, the physician will need to declare whether or not his or her practice is open for new patients, in which case they must, for a designated period of time, be willing to accept any and all patients. As having access to comprehensive medical care and prescription drugs is a powerful incentive, as well as the only game in town, it is expected that virtually all will enroll; citizens and legal aliens. To be eligible, only a Social Security number is necessary, and we would ask enrollees to provide the same documentation required by employers to establish eligibility for work.
Once this enrollment is completed, all healthcare decisions are made by the primary care physician and the patient, in consultation with any specialists, ancillary and institutional providers the PCP may choose to involve. The government has absolutely no input into the process.
We recommend that the U.S. Census Bureau be asked to maintain the data base of Americans and the primary care physicians whom they individually choose, as collection process will dovetail very nicely with that Bureau’s mission and responsibilities. Parents of dependent children will choose for and register their sons and daughters with a PCP. In some cases, it may be an OBGyn for Mom, a Pediatrician for the kids, and maybe a general practitioner for Dad. Another family may choose a family practitioner to care for them all.
Primary care physicians (PCPs) will be paid directly from the Health Services Fund (HSF) on the basis of the number of patients who have enrolled as that PCP’s patient. The PCP will receive payment at the beginning of each month and will use that revenue to cover the cost of:
- Primary care, that his or her own office will provide;
- Prescription drugs;
- Diagnostic services;
- Specialty care;
- Ancillary care (physical therapy, home healthcare, hospice care, chiropractic care, etc.);
- Hospital care; and,
- Long term care.
The amount of revenue the PCP receives will be actuarially determined on the basis of each patient’s age, gender, and general health condition. The actuarial science is pretty-well developed. We will recommend that a bi-partisan Health Services Commission be created. The appointments will be unpaid and the appointees will be selected from among healthcare professionals and managers, actuaries, and representatives from the re-insurance industry. This commission will oversee the application of actuarial science and provide guidelines to the Census Bureau for the purpose of special designations for individuals. End-stage renal disease would be one example where a patient’s designation would demand a higher capitation payment to the PCP.
The average revenue per patient will be approximately $570 per month, or $6,840 per year ($2.1 Trillion divided by 307 million Americans. Assuming a PCP’s patient population is proportionate to the
It is with this sole source of revenue that the PCP must manage her practice and pay for all services provided to her patients. We will discuss the business ramifications of this new way of doing business in a later article but keep in mind that, it is the flow of revenue that creates the rules by which the game is played. In addition to a transformation from a transaction- driven and receivables-managed business to one that is relationship-driven, patient-centered, and cash- and future liabilities-managed; everything changes and almost always for the better.
The PCP will contract with pharmacy, specialty, diagnostic, institutional, and ancillary providers; selecting those with whom he is able to negotiate the best price and with whom he feels he can work most comfortably and confidently. For the first time, the interests of patients and providers are perfectly aligned; the healthier the patients, the better it is for all parties.
Financially, under this plan, a primary care practice is more attractive than it is today, and choosing primary care places a young physician at the very center of the business and practice of medicine. That PCPs are paid upfront also provides real incentives for new physicians to select a location for his or her practice in a geographical area that is currently under-represented with respect to physicians, both PCPs and specialists. For example, a new PCP who chooses to practice in an area where there are insufficient numbers of doctors will almost immediately fill his practice with patients. Because capitation revenue is the same, whether the patient is rich or poor, this new PCP will immediately have a revenue stream comparable to a long-standing doctor practicing in a wealthy suburban community. These real incentives are expected to decrease the percentage of young doctors who choose sub-specialty practices while improving the geographical distribution of practicing physicians.
There will, of course, be some MDs, both young and old, who will wish to avoid the responsibility of case management as a primary care physician and such choices do, undoubtedly, serve the best interests of all.
To understand just how different things will be, we need to take the time to understand the difference between fee-for-service (FFS) and prepaid care. We also need to have a full understanding of the case-management role primary care physicians will be asked to play. The next article (our fourth) will be devoted to an analysis of the FFS/Prepaid care dichotomy. The fifth article will explore the dynamics of case management in a prepaid environment.
Because of some of the issues that developed in a prepaid care environment during the heyday of the HMO movement, it is vital that the reader be willing to keep an open mind. Yes there were problems with the HMO environment that must not be repeated but just because an idea did not work the first time, doesn’t mean it was a bad idea. We will show, clearly, how the problems of the past can and will be avoided in this new model.
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