The Mayo Clinic committed a Kinsleyian gaffe of saying the obvious loudly:
Mayo Clinic’s chief executive made a startling announcement in a recent speech to employees: The Rochester-based health system will give preference to patients with private insurance over those with lower-paying Medicaid or Medicare coverage, if they seek care at the same time and have comparable conditions.
This is not surprising. It is the economic logic of a profit seeking entity which faces a wide variety of accepted prices for its services. If there are two bids for the same resource, the higher bid wins.
We’ve discussed this before in the post examining Provider A(ccount) R(eceivable) Preference post from the Spring of 2014 :
Providers have clear account receivable preferences as to what patients they treat.
The ideal patient from an account recievables perspective pays a very high percentage of the billed charge with a high degree of certainty and a short turn around time and minimal haggling. Excluding celebrity rehab centers and $40,000/year per person coverage, there are few payers who meet this provider ideal. Everything else is a trade-off.
Large group, commercial insurers that offer low deductible plans are often the meat and potatoes of a practices’ revenue cycle. Low deductible means the provider is not chasing members for money after the service has been rendered, and commercial providers tend to pay fairly high reimbursement levels….
After this, Medicaid will pay quickly but at a low rate… Docs and providers will fill out their roster with Medicaid patients, or use Medicaid as a means of building out a practice when they are fresh out of Med School, but a practice that exclusively sees Medicaid patients will be in constant financial stress.
At any provider office, someone knows precisely what the payer mixture looks like. It is probably not the doctor, but someone behind a desk knows the day’s revenue potential based on who has what coverage for what procedures. At smaller practices, it is the office or billing manager who will tell the front desk to keep the last optional slot open for a commercial high fee patient for as long as possible and then fill it with a lower paying patient once the risk of leaving the slot empty outweighs the possibility of getting a high paying patient in the slot. Evidently at Mayo, it the CEO saying this instead.
From a policy point of view, if appointment availability is a flaw in Medicaid, then the solution is really simple. It is not to defund Medicaid. It is to pay the doctors more or otherwise find ways to narrow the gap between Medicaid payment rates and commercial payment rates.
Until then, Mayo will wear a hair shirt for a few weeks and there will be a sacrificial lamb for someone saying the unspoken truth out loud and on tape.
Boudica
So if we go to a Medicare-for-all system, would doctors earn enough to fund their practices? Would the government raise what they pay doctors? Sincerely curious.
Baud
@Boudica: Answer probably depends on either private insurance and off-Medicare services are permitted.
Hunter Gathers
Surprised that the Mayo Clinic’s CEO didn’t yell ‘MAGA, bitches!’ before dropping the mic.
OzarkHillbilly
SHOW ME THE MONEY!
David Anderson
@OzarkHillbilly: you had me at hello
Mary G
I had to fight to get out of rehab after I broke my ankle because I bought the gold Medicare supplement and had no copays. Three physical therapists, two nurses and the facility’s manager came to try to get me to stay. People who had high copays and low incomes and people on Medi-Cal aka Medicaid were hustled out the door as soon as possible.
Baud
@Mary G: “Escape from Rehab” starring Kurt Russell.
Certified Mutant Enemy
Mayo Clinic
Certified Mutant Enemy
... the Mayo Clinic, named after its founder, Dr. Ted Clinic …
— Dave Barry
trnc
Off topic, but maybe someone wants to start another thread. Bannon has released his budget, and it’s everything that we’ve come to expect from the carnies in the White House.
https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/budget/fy2018/2018_blueprint.pdf
Now back to your regularly scheduled healthcare thread.
Another Scott
@trnc: It’s worse than it looks, but the Democrats have some cards. GovExec:
As many have said earlier, it’s hard to see anything but Continuing Resolutions through 2018 and maybe longer. There is just too much disagreement to think that a majority will vote for a budget.
Cheers,
Scott.
David Anderson
@Baud: No, No No, No
Name Under Development
“They tried to make me pay for rehab I said no, no, no.”
–Amy Winehouse
GregB
Will the budget be written on the skins of dead poor people?
MomSense
@Boudica:
One of the issues with Medicare for all is that we would have to change the way we educate/train doctors. The current system guarantees exclusivity – too few doctors with too much debt to offer affordable and services to enough patients. This is a big reason that the idea of a sort of instant transition doesn’t make any sense.
Ian
And how does this square with the hippocratic oath doctors must take?
TS
@Boudica: Probably as happens in Australia – the government will pay a specified amount for each type of service and the doctors will charge some folks more than others for the same service. Having recently retired I now pay $15 to visit my local doctor. Prior to retiring, I used to have a co pay of about $30 per visit. The surgery that I use charges less for people with government health cards (usually retirees & low income folks, the unemployed). I see the same doctor, get the same service for a different price. It gets somewhat more complex because of safety nets, maximum annual pays and the type of service. My x-rays and scans are now free to me. They used to be a co pay of $100 or more.
Sadly nothing is as simple as “medicare for all” Some doctors charge everyone the government fee. Some doctors charge everyone extra. Some get very wealthy, some not so much.
JPL
@GregB: Yes. A lot of Trump voters are soon going to understand the priorities of the monster they voted for.
dr. bloor
@Ian: Curiously, physicians don’t delve into payment systems when making their pledges to Apollo and Panacea.
More to the point, the oath doesn’t direct physicians to take all comers.
sherparick
They Mayo Clinic is a non-profit entity. https://en.wikipedia.org/wiki/Mayo_Clinic As such, it is not suppose to be guided by the Friedman Principle of corporate governance (the world’s dumbest idea – see article) of for profit corporations, e.g. that a firm’s employees first duty is to “maximize shareholder return” within the bounds of law and custom (and stretching those as far as possible). “That responsibility is to conduct the business in accordance with their (shareholders) desires, which generally will be to make as much money as possible while conforming to the basic rules of the society, both those embodied in law and those embodied in ethical custom.“ https://www.forbes.com/sites/stevedenning/2013/06/26/the-origin-of-the-worlds-dumbest-idea-milton-friedman/#745984f3870e
Unfortunately, as the excellent article (in all places Forbes) shows how this very dumb idea (which leads to excessive executive compensation) has spread even to non-profits. It should be remembered that the Mayo Clinic started in part as a charity service by the Sisters of St. Francis and W.W. Mayo. So this CEO has forgotten the corporate purpose of his institution. It is not a profit maximization toy for the CEO and he has no shareholders to answer to. The stakeholders in the Mayo Clinic are its employees and patients and the whole community which provides it exemptions from taxes.
liberal
Best solution is to not only nationalize health care insurance (single payer), but also nationalize health care itself. The current system is horrifically inefficient, and there’s no proven way to get price signals right.
AFAICT, there’s a rough correlation between efficiency and degree of socialization (insurance and medicine) across nations.
sherparick
@Another Scott: Another critical point is coming up is debt ceiling vote. The Tea Party/Freedom Caucus faction in the House is (on the face of it adamant that they will not vote for debt ceiling increases (even as they vote to cut taxes and raise defense spending). So Ryan and Trump are going to need Pelosi’s Democrats in the House to vote for it. She should give them Michael Corleone answer to Senator Geary from the Godfather II.
If Ryan wants the Democrats votes, the price will be to ditch the Trump budget and Republicans’ Death Panel Act of 2017.
ArchTeryx
Oh, I can cite chapter and verse on this. My Ohio State junk grad student HMO actually had the Cleveland Clinic as an in-network provider back in the late 2000s. The outpatient care was exemplary. However, to get the surgery I needed to save my life there, I had to pre-pay my co-insurance, to the tune of several thousand dollars, before they would schedule my procedure. If not for a well-off friend, I wouldn’t have gotten that surgery. The surgery itself was great, but once I was in recovery, the trouble started.
It was blatantly obvious who was favored on the floor. There was a stunning lack of nursing care for the “insurance patient” floor, and after several days, my patient advocate found out why: A Saudi prince was also getting a procedure done at the same time, and an entire floor, plus the observation deck, was closed off specifically for him. Most of the nurses were up there making sure his every beck and call was waited on. When time came to show me my colonostomy bag, the bag folks (outsourced, of course) basically breezed in and out in 5 minutes before heading upstairs.
But that wasn’t the worst of it.
The worst was when I had to go to CC’s ER after being discharged way too early, and the colonostomy bag setup failed to stick. The ER – which handled mostly poor patients and was there only to satisfy Ohio law – basically left me to burn, quite literally, in my own digestive fluids the entire night. They simply didn’t care. When my surgeon got in the following morning, he was livid. It took over a week of agony in the hospital to patch me up enough to try to stick a bag on again. Eventually, they succeeded, and I had no further problems.
Our Gilded Age class divide in a nutshell.
MomSense
@liberal:
Which nation’s health care system would you model ours after and how would you get the votes for it in Congress?
What we are seeing now with the Republicans is how much easier and politically expedient it is to be opposed to a plan than to design one and get it through all the hurdles to become law. Liberals/progressives did this about the ACA and convinced themselves the only explanation was that Democrats sold us out. Then they stayed home in 2010 giving the Republicans the house and even worse giving them state houses and governors mansions the same year as census and redistricting. It was a spectacular failure IMHO. It has caused significant harm. Brought us the voter ID and other voter restrictions and purges that delivered 45 to us. Bring some specifics to this conversation because there is not much appetite here for fantasies when so many lives are at stake.
Jeffro
@Ian:
I think there’s a Ryan Corollary to the Oath, that reads, “…take the non-moochers first…”
Gatchaman
First do no harm – to the bottom line.
Jack the Second
@sherparick: The Democrats have a whole host of poison pills we could happily be inserting into any legislation they want our votes on.
* Repeal the Hyde Amendment.
* Double the funding for Planned Parenthood.
* Close the carried interest loophole.
* Lower the eligibility for exchange subsidies to 100% of FPL.
* Appoint a special prosecutor to investigate connections between Russia and the Trump administration.
* Eliminate the debt ceiling.
Spanky
@David Anderson: Starring Nick Nolte?
Pogonip
@sherparick: What WAS Michael’s answer to Senator Geary? I haven’t watched Godfather II in 10 years or so.
The gray adder
@Mary G: Sounds about right. My wife works for the state of New York, so I often get shuffled around to this specialist and that one for the flimsiest of reasons. Before long, I’m taking whole days off from work just so I can meet these appointments where the result is that I’m not going to die, but they want to keep an eye on that 3cm cyst or whatever it was that wasn’t bothering me.
Barbara
1. How would they know that other things are equal if they haven’t yet accepted someone as a patient?
2. Maryland.
Mayo Clinic lost its soul a long time ago. It would probably not surprise most people here to find out that the Mayo Clinic aggressively pursued litigation against the IRS so as not to have to contribute social security for residents, probably the backbone of its system. It got lovey dovey treatment from the courts in its own backyard until the U.S. Supreme Court set everyone straight. This was recent, not a long time ago. So screwing over the poor and exploiting labor is a way of doing business. There are other places you can go that are just as good and that don’t require you to support a scam masquerading as a charitable institution.
ETA: You can go to Johns Hopkins, which operates in Maryland, where hospitals are paid the same for all patients and so no one has to discriminate against Medicaid beneficiaries to make a buck. Also, hospitals don’t actually know how much things cost. I don’t believe any of them when they say they lose money with this or that patient. They are not credible.
sherparick
@Pogonip: My offer is nothing. https://www.youtube.com/watch?v=wPmTp9up26w
raven
Rachel Maddow’s Trump Tax Report Proves A Comedy Gold Mine For Late Night TV Hosts
Corner Stone
@Pogonip:
They agreed to a lucrative Pay for Play deal that involved kickbacks, cross border drug running, prostitution, you name it. True story, the role of Sen Geary was modeled after the career of a Senator from Illinois who later went on to become the 44th POTUS, one Barack Hussein Obama.
sherparick
@Corner Stone: So you believe in time travel too. (Godfather II premiered in 1974).
Before the troll got us off topic, it should be remembered that the Mayo Clinic is a non-profit and should not run by the same brain dead ideas that run for-profit firms. https://en.wikipedia.org/wiki/Mayo_Clinic and https://www.forbes.com/sites/stevedenning/2013/06/26/the-origin-of-the-worlds-dumbest-idea-milton-friedman/#745984f3870e
Given that the ACA reduced substantially the total amount of non-reimbursed services that ended up as uncollected bills, it has been a money maker for most hospitals. Mayo’s CEO’s comments have raised some eyebrows in Minnesota.
http://www.postbulletin.com/news/local/ceo-comments-spur-concern-about-mayo-clinic/article_f722c86b-db97-5251-84d5-7f392e8f7cb6.html
Brachiator
@liberal:
The British NHS is not efficient. The French and Canadian systems have been praised. Are there studies that rank systems by a variety of measures?
hovercraft
@Another Scott:
I think our White House is learing, they are trying to get out in front of this, Tillerson Defends Trump’s Proposed Cuts To State Department Budget.
So he thinks the job of the state department is to focus on the “challenge” of budget cuts and efficiency? That’s what he thinks is the challenge they are taking on? Less conflicts, he’s in Japan, did his boss tell him about the armed drones butting up to the DMZ?
jhtrotter
But I thought the business model was to charge way too much to those who could afford it (or their insurer), so you could treat some of those who can’t afford much, to maintain the perception that doctors are all empathetic beings.
All this (fillinsomename)care talk, with nothing being done about the obscene amounts that providers can charge, is all kind of silly, isn’t it?
Lizzy L
@Corner Stone: Sarcasm tag required, methinks. It’s morning, some folks haven’t had their coffee yet…
sunny raines
this result is only “obvious” for a society that uses money as a value system. For a society that uses morality, i.e., that values life and equality of all as a value system, this result would be anathema.
Brachiator
@sherparick:
Shit is getting real, now. Trump has to actually do some presidenting, and so far he has not shown that he is up to the task.
For that matter, has Ryan done anything as Speaker up to this point?
ArchTeryx
@sherparick: “Nonprofit” simply means that they don’t have public investors taking a share off the side. When it comes to administrative bloat (and ratio of CEO pay vs. income) universities and nonprofit hospitals can make public multinational corporations look like pikers. There’s LOTS of ways to pad one’s bottom line in a nonprofit, and hospital admins are masters of it.
Brachiator
@hovercraft:
And so, we need to increase defense spending? To deal with fewer military conflicts?
David Anderson
@Barbara: Mayo has payment records on most of the people in MN and they know what their current census payment source is, so if it is a pair of recent patients calling for a non-urgent follow-up, they should either know or make a damn good guess. This is especially true if the work flow for appointments includes “What insurer covers you…”
sherparick
@ArchTeryx: Yes, that is unfortunately true now because non-profits their C-suite executives have become infected with Uncle Milton’s terrible ideas as well these last 40 years. https://www.forbes.com/sites/stevedenning/2013/06/26/the-origin-of-the-worlds-dumbest-idea-milton-friedman/#745984f3870e. But the CEOs that run these firms and who enjoy all the privileges of charitable organizations under Federal and State tax law need to be held to account and reminded that they are not profit maximizing institutions and should not be run on Ayn Rand principles.
The Moar You Know
Unfortunate that anyone would lambaste them for merely telling the truth. I’d rather know than not.
sherparick
@Brachiator: I can see that Trump has now added two new countries with U.S. actively involved in the local wars. http://www.militarytimes.com/articles/official-couple-hundred-us-marines-go-into-syria and https://news.vice.com/story/trump-unleashed-40-airstrikes-over-five-days-in-yemen
JCJ
@Ian: @Ian:
Well, according to the article he is an M.D., but he made this statement as a hospital administrator not a doctor.
sunny raines
@Jeffro:
the wealthy typically are the biggest “moochers” of all, slopping at the taxpayer trough, stealing way more money than is spent on the non-rich, e.g., see “defense” budget. They only make it seem legit by infesting the government to put the trappings of government on their welfare.
Barbara
@David Anderson: How do they know that the patients are equally situated in terms of medical need or health status? That my need for an urgent appointment to an in-demand specialist is more or less acute than another person’s?
evodevo
@MomSense: Yes. In Germany and other countries, medical ed is subsidized or FREE. That way the gubmint can pay them a reasonable salary when they get out, and medical costs can be somewhat contained. Otherwise, it’s just a race to see who goes broke first.
Another Scott
@sherparick: Someone on the “1A” show on NPR this AM was (kinda gleefully) saying that Trump may decide to shut the government down if he doesn’t get a substantial portion of what he wants in the budget. (roughly) “Imagine if he says he’ll shut the government down for 6 months – then the Congress will have to negotiate and give him what he wants.”
I’m glad I don’t live in that guy’s Bizarro World where Social Security and federal retirement and Pentagon pay checks go out on time when the government doesn’t have any money.
Trouble is, Donnie’s Minions, and Bannon especially, since they don’t understand anything about how the federal government actually works, would probably think they can do it.
:-/
Cheers,
Scott.
hovercraft
@Brachiator:
Logic is not a hallmark of this administration.
hovercraft
Obamacare Repeal Bill Takes Another Step Forward, Passage Still In Doubt
After mere minutes of debate, the House Budget Committee narrowly approved the GOP bill to repeal the Affordable Care Act, 17 to 19. Three hardline conservative Republicans on the committee—Reps. David Brat (R-VA), David Gary Palmer (R-AL) and Mark Sanford (R-SC)—joined every single Democrat member in opposing the bill, but were unable to muster the numbers to stop its passage.
The bill had been expected to squeak through the Budget Committee, though the exact number of Republican defections was up in the air. The bill next goes to the House Rules Committee, where it could see significant revisions.
The successful vote to advance the bill comes amid a wave of criticisms of the legislation from the left, right, and center, and admissions from House leadership that it cannot pass in its current form.
Conservatives lawmakers in the House are trying to pull the bill farther to the right, fighting to impose work requirements for people on Medicaid and speed up the freeze of the Medicaid expansion. But moderates in the House and Senate—especially those from states who opted to expand Medicaid to hundreds of thousands of people—tell TPM these changes could drive away their votes.
Scott
http://www.mayoclinic.org/about-mayo-clinic
Maybe more accurate to say “Revenue seeking” since Mayo is non-profit. They still want to be assured of break-even or surplus.
Juice Box
Wow. My office never looked at insurance to schedule. Insurance eligibility was determined the day before the appointment or at check-in time and uninsured patients were simply warned that they might be required to pay their own bill. We had a capitated contract with the county every year to accept a given number of Medical patients in addition to our long term patients who might be on or off MediCal at any time. We also took cash patients and discounted their payments at the discretion of the doctor and automatically for same day payment (20%). Physician compensation was based on numbers of patients and complexity, but not on insurance mix.
Barbara
@hovercraft: So Lincoln Diaz Balart voted for it. His district is among three South Florida Districts that have more people covered under the ACA than any others in the country — more than 90,000 in his district alone.
JustRuss
Technically, the Mayo isn’t a profit-seeking entity, it’s a non-profit. Now, non-profits don’t run on rainbows and unicorn farts, so yeah, they go where the money is. More disturbingly, “non-profit” seems to take on a weird twist in the medical industry, our local non-profit hospital happens to own several very lucrative properties that have nothing to do with medicine.
I’m a little confused about why this is news worthy. For years I’ve seen plenty of providers say they’re not taking any more Medicare or Medicaid patients due to the lower compensation. Is it just because Mayo’s supposed to better than that?
WereBear
Doctors will also have to wrestle with the fact that a previously vital skill; the ability to remember lots and lots of stuff; is no longer as relevant as it used to be.
I wrestled with the endocrine part of my illness for way too long. Part of that, as someone explained to me, is that endocrinology is basically matching test levels with hormone dosing; and little else. It explained why they never delved into what was really going on.
I was quite profane about this, and pointed out that under such rules, I could Be an Endo by setting up a spreadsheet. And the person agreed that a lot of them practice that way.
I’m not denigrating the profession in any way; some of them truly are compassionate people who practice this as an art, and some of them are very smart people who practice it as a science; and then, there are the rest of them.
John Revolta
I just love “Account receivable preferences”. Sounds so much nicer than “Fuck your poor ass”.
Irrrr
Would utter and complete price transparency for services across all payors (fed, commercial, etc.) solve the problem of wasteful and expensive care as a nation? If everyone knows what everyone else is paying/charging at all times, don’t we bring down all prices as a nation? One can dream I suppose.
artem1s
@Brachiator:
Remember when he took the job and he wanted assurances that he would be able to spend time with his family? I think it might be about time for Lyin’ Ryan to go spend more time with his family
Mickee
I worked at Mayo in AZ 15 + years ago. This was their policy back then and it wasn’t even particularly implicit. Other local health systems had to pick up the slack and it pissed them off.