Welcome to another edition of the Doctor’s Note where we talk about what’s on our minds when it comes to your health. Most of you know, by listening to my podcasts, that I believe strongly in taking control of your own health. This week’s topic on healthcare and the business of medicine, will hopefully point you in that direction by giving you options on how to spend your healthcare dollars.
From The Doctors’ Perspective
I want to begin by talking to you about doctors. I’ve been a doctor for 36 years. My dad was a doctor. A lot of my relatives are doctors. So, I’ve been around A LOT of doctors my whole life. The first thing I will tell you is that it’s a myth that doctors are wealthy. If they’re willing to work hard, they can certainly make a great living, but in general they are not among the top wealthy people in the country. The only people I would term “wealthy” in the healthcare industry would be the executive types (hospital administrators, insurance executives, pharmaceutical executives, etc).
I’ve always said that I really think doctors ought to be running healthcare. In my opinion, hospital administrators should be physicians, and they should still be practicing medicine at least part of the time. If you’re actually seeing patients, then you’re going to have a better idea of what’s going on. There are some physician administrators who are doing this, and I admire them very much for it.
Most every other healthcare worker is either working directly or indirectly for these executives, (who are the ones making the decisions). I’ve been around a lot of hospitals, administrators, and doctors in general. Hospital administrators don’t like doctors these days, and doctors don’t like hospital administrators. Any doctor will tell you that, except those in both roles trying to bridge the gap (which is good!). But in general, I would say this is true.
The Concerns Of The Doctor
In general, doctors are concerned the most about three things:
- Taking care of the patients. FYI: This should be the goal of every doctor in medicine!
- Making a living.
- Avoiding a lawsuit.
The last one is important because this could mean they’re practicing defensive medicine. This drives the cost of medicine UP. Note: not a good way to practice medicine. The oath we take as physicians, “Do no harm” can also be translated “Don’t do anything that may be innovative or ahead of its time”. For example, treating a virus. Most doctors will tell you that insurance regulations make their practice of medicine unenjoyable. It hinders the way they have to practice medicine.
There’s a heavy burden on doctors and healthcare workers. It’s a hard job! Why? Here are some examples:
- EMR’s (Electronic Medical Records)
- Fear of malpractice
- Staff shortages
- Constant worry about being responsible for the lives of your patients
No wonder there’s a shortage of doctors and nurses, which to me are the backbone of healthcare. Nurses are leaving healthcare in record numbers. They have increased rates of depression and suicide. Look at your average nurse or doctor. With the exception of a few, most are pretty unhealthy and you would think they would be the example of what healthy living looks like!
When you get a bill from a doctor, hospital or any facility in the healthcare system, the doctor is getting a relatively small percentage of that. And remember, their overhead is high. I run my own private medical practice. It’s private because it’s between me and the patient. No insurance. I don’t take insurance for office visits. I don’t have an EMR. I use the old timey paper charts, which I love. I, also, don’t have bosses that are non medical telling me what to do, how many scans I need to run, or how many patients I need to see a day to make the organization work. I’m very lucky to be able to do this type of practice. My patients thank me for it everyday, and I look forward to going into work.
What To Do As A Patient
I’m 68 years old. I have an MD and an MBA. My goal in these next couple of sections is to show you how to best utilize the healthcare system, your insurance, and stay healthy. These can all work together!
Let’s start with what keeps you healthy!
Staying healthy mainly comes down to:
- Stress reduction (stress brings half of the medical visits at least)
- Avoiding obesity
- Screening tests
Our nation’s worst healthcare problem is obesity. I’ve said this many times. If the average weight in a United States citizen was what it was in the 1960’s, there would be no healthcare problem. The next worst healthcare problem is the overuse of drugs (illicit and prescribed).
In medicine, you need to use common sense in decision making and have empathy for your patients. The medical practice you go to has to be patient oriented. The patients are the ones who need to be listened to. It’s all about prevention and finding the root cause of your problem, not just prescribing another pill or trying to find a code for an insurance company.
Find a doctor who will listen to you and treat you like you’re the most important person in the room (not them). Doctors need to learn to listen to you, but be careful that you don’t overwhelm them (with every problem you ever had) in one visit. This may cause them to tune out. Focus on the main concerns about your health.
The Insurance Business
It’s so important to learn to navigate insurance. You need insurance, but insurance should be for disaster. It’s not designed for routine care. Back when there was no insurance (when my dad practiced), healthcare was inexpensive. I think the cost of an appendectomy in 1960 was something like $100. And that was for everything. Surgeon’s fee, hospital fee, everything! These days there are so many middlemen involved and everybody wants a piece of the pie. They want a part of your money.
How do you navigate this insurance mess? You have to have it. So, what are your best options? Most people need a High Deductible Health Plan. If you have a serious chronic illness, then you may need a different kind of insurance. But most people simply need a high deductible plan, which is what most employers are offering now. The biggest employer in the region where I live, has a $6,000 deductible for the family.
One huge problem with blindly relying on your insurance is the lack of transparency. You may think that when you go to the doctor all you’re responsible for is the co-pay, but then a few months later you get this bill that you didn’t know you were going to have to pay. There’s not a lot of transparency. With most insurance companies, the patient, doctor, and staff usually have no clue what you’re going to end up paying for that visit, or that hospitalization. They just don’t know! You can have surprises. The same thing for pharmaceuticals. There’s so many different insurance companies, and what they pay can vary. What I’ve found is that you’re probably better off paying cash for a generic drug (80% of all drugs are generic). Check out, and get to know websites like GoodRx, Amazon, or Cost Plus Drugs (only generics).
Note: The markups on drugs are unbelievable.
I’ll give you a couple of good examples. I had a patient come in to see me recently with narcolepsy. I prescribed Modafinil, which is a generic drug. He went to CVS and simply couldn’t afford it. He called my office back that afternoon and told us he can’t pay $850 a month for the medicine (which he needed!). So, we looked it up on GoodRx and found that instead of $850 a month at CVS, it costs $35 a month at Food City.
Note: Shop around for your medicines!
Another recent example, a younger patient of mine had a minor hospital visit. The bill was $7,000, and they thought this young lady was uninsured. She automatically qualified for an 85% discount for paying cash. Ironically, she ended up going to a different hospital for the same thing a month later. That hospital realized that she was actually covered under her parent’s plan, because she was under 26 years old. So, even with her insurance, her family had to pay over $4,000 for that visit (while using her insurance). When they tried to go back and pay cash, and not use their insurance, they were told they couldn’t.
Note: Don’t pay a bill that you don’t think is right until you thoroughly investigate it. Hospital systems are notorious for not knowing what they’re doing when it comes to billing.
For most people I recommend a high deductible plan and an HSA (Health Savings Account). This combination is incredibly powerful in today’s healthcare environment, and in 2023 it’s going to be even better. There are Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs). An FSA may be offered by your employer, and they may even pay for some of it. The problem with this type of account is you can’t invest that much into it. Plus, it doesn’t rollover at the end of the year. If you don’t spend the money, you lose it. They estimate that over 3 billion dollars are lost in these accounts every year because they weren’t used.
In an FSA you can put around $3,050 (which is up 7% from last year). Contributions have to be set at time of enrollment. In my opinion, if it’s available to you, an HSA is a better option. This can end up saving people a lot of money. With an HSA you can sock away pretax money to pay for virtually any medical expense. Basically, you can save what you would have paid for in taxes, on the money in these accounts. Plus, if you can’t spend it, these plans allow you to roll them over every year. You can keep them going, and build them up.
Single workers who want an HSA can save up to $3,850, and families can save $7,750 in these HSAs every year. This is an increase of around 6-7% from last year. The FSA is a bit trickier than HSAs. There’s a store called FSAStore.com that can be helpful. If it’s available, in my opinion, the HSA is the way to go (with the FSA being a distant second). They are a little different as you can see. The FSA is more controlled by the employer, and the HSA is more controlled by you.
I love that the HSA stays with you. You can grow it with different plans and really use it as an investment vehicle. You can only have an HSA if you have a qualified high deductible health plan. You can change the amount of contributions at any time. You can use HSAs for all kinds of things, like vitamins and supplements. It even covers dentists, orthodontics, and eyeglasses. It can be used for anything recommended by the doctor (even massage therapy is covered).
The downside to an HSA is if you take the money out for something other than a medical expense, you will pay taxes on it, plus a 20% penalty fee (before age 65). If you’re over 65, you’ll still pay taxes, but you won’t have to pay the penalty fee. It’s a great deal. Triple tax savings!
This is out of pocket spending that you can control and get reimbursed through a tax advantaged plan. You can even use it to meet your deductible if you incur some high expense, and you can use it for your co-pay as well. I know that everything I do at my office, you can put on an HSA.
What About Medicare?
Medicare is another one that’s important to understand. Typically, you will want to talk to a broker. Someone who doesn’t represent one company. They will be unbiased and can explain Medicare as a whole (what it covers and what it doesn’t).
Every Medicare situation is unique. You need to choose your Medicare Plan based on your own individual needs. There are Advantage Plans, Supplemental Plans, and Drug Plans. Depending on your health issues, one combination might work better than another. This is why you need someone to sit down with you.
When choosing my Medicare plan, I realized that if I signed up with a Medicare Advantage Plan, and came down with some weird disease that couldn’t be handled where I live, there’s a chance that the Advantage Plan I had would NOT cover me where I NEEDED to be treated. With Supplemental, as long as the physician or group takes original Medicare, I can be treated wherever I am.
Note: If they take Medicare, they take Supplemental.
Traveling was another concern of mine. If you are out of town, and it’s not deemed an emergency, you’re probably going to pay out of pocket if they don’t participate in your particular local plan. If it IS an emergency, it will cover it.
Note: Full transparency, I chose Plan G which will cover me anywhere. You can check out the full article I wrote on Medicare here.
- Consider taking your care to a cash based practice. You get more transparent pricing, more time with your provider, and more likely than not, a more happy provider. This matters! The cash based practice is a trend that you will see more of in the future. Within the last year, I’ve had three specialists (a cardiologist, endocrinologist, and rheumatologist) reach out to me for advice on starting a cash only practice. They are already doing well! The wait time is very short to get in to see these specialists.
- Know what your insurance options are.
- Remember, YOU are the customer. The doctor is working for YOU.
I hope 2023 is a very good year for your health! Till next week.