Stage 2 Obamacare: the death knell for doctors

doc-fall-300By way of disclaimer, I have mixed feelings about Obamacare. I’m glad that more people (including myself) have healthcare insurance because of it, but I am very aware that it comes at the expense of windfall profits for the nation’s biggest insurers and extraordinary (and illegitimate) borrowing costs on state and federal debt (which is a whole other can of worms).

But as they roll out the second phase of this legislation, it’s becoming painfully clear that Obamacare was a hostile takeover of healthcare in America by the insurance industry. It looks like stage two of this fiasco involves leading doctors “who don’t perform” to slaughter. Like a venereal disease, Obamacare appears to get worse over time. The only thing Obama seems to “care” about is profit margins for insurers.

The Obama administration announced Monday a sweeping new plan that will directly affect thousands of hospitals and doctors across the country. The federal government now plans to pay Medicare doctors more if they help patients get healthier — and less if their patients just stay sick. This would be done by tying 85 percent of all Medicare payments to outcomes by the end of 2016 — rising to 90 percent by 2018.

The idea is to move away from the broken and expensive “fee-for-service” system, which pays doctors a flat amount for every surgery and physical they perform — even if they do nothing to actually help a patient.

Holy cow. That’s like telling lawyers they only get paid if their client wins. Of course, that would never happen because crafty lawyers write the laws, and they work for bankers and insurance companies.  A service is a service. Doctors don’t just prescribe medicine or therapy or perform procedures. They, like every other laborer, spend their time and effort and they should be fairly compensated for that. Why is that government only looks to curb incentives for labor and never at incentives for capital.

But in addition to that obvious substantive problem, outcome based payments are less than 20% now. That kind of dramatic shift is astronomical and will cause a huge impact on most small practices, the best physicians out there, probably putting them out of business, if not from the drop in revenue, from the sheer volume of administrative tasks involved in monitoring whether new reductions in payments are authorized, and if so devising ways to make up for it.

I can’t imagine that doctors are happy about this. And reading through the article I can tell that the author works for the insurance industry.


One reason the cost of American health care is so high is that insurers are so weak. Having hundreds of different carriers, for example, means no one insurer has lots of negotiating power — hence those high prices drug and device makers can charge.


This suggests that tamping down on insurers’ profits won’t do much to tamp down on overall healthcare costs. They’re not pocketing a large amount of premiums; instead, they’re spending those premiums on a really expensive medical products.

Nice try. “Poor insurers – they’re barely scraping by.” Too bad reality proves otherwise.

So far in 2013 the value of the S& P health insurance index has gained 43%. Thats  more than double the gains made in the broad stock market index, the S & P 500.  The shares of CIGNA are up 63%, Wellpoint 47% and United Healthcare 28%. And if you go back to the  early 2010 passage of ObamaCare, you will find that Obama’s sellout of the public interest has allowed the public companies the ability to raise their premiums, especially on small business, dramatically multiply their profits and send the value of their common stocks  up  by 200%-300%.

This development is very worrisome. Not so much for its impact on doctors, though they too are important, but for its long term impact on overall healthcare and society. Greedy doctors that care more about patients than profits will be run out of business. Those who remain are are simply going to stop accepting elderly and poor patients. The costs of caring for them will go down for insurers, but life in America will become unbearable as tens of millions of Americans struggle to care for their sick and elderly parents, with dwindling help from a “healthcare” industry focused on profits and greed.

If Americans really want to end healthcare waste, they would stop letting money grubbing accountants in the banking and insurance industries control our every move and skim off every dollar we spend on our health.


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