Mmmmmmoney!

by William D. Esteb

Nothing gets the attention of a doctor faster than talking about fees, income, money, collections, and related issues. After more than a decade of relatively easy money from the reimbursement of third parties, the financial dimensions of practice have significantly changed. Doctors willing to recognize these changes and separate the emotionalism normally associated with these matters can make an elegant transition into the future. Those who deny, ignore, or try to create a future in the image of the past will find the greatest shock. While you may not agree with my conclusions, risk a few moments to explore some alternatives to the uncertainties and ambiguities directing the patient financial policies in many chiropractic offices these days.

As of this writing, the final version of the changes wrought by government intrusion into health care are far from being resolved. And anyone who suggests that they know how things are going to turn out, and because of their apparent insight, you should do X or Y, and begin doing more Z, is lying. No one really knows, including me.

Like many issues in chiropractic, there seems to be large contingencies within the profession working at cross purposes. Some want to be included in whatever gets doled out by the government and others don't want anything to do with it. While there's nothing new in such diversity of opinion, I wonder if those who have so quickly agreed to surrender control of their practices and the recommendations they'll be permitted to make to their patients, have thought through the implications of being included. Certainly, if the only motive is a last ditch effort to maintain a lifestyle bloated by the easy insurance money of the past, then the decision is easy: vote for inclusion. Belly up to the bar. Get your "fair" share.

Perhaps if more doctors could see beyond simply making next month's payments they'd reach a different conclusion.

The forces, and they're sizable, that are attempting to make sure chiropractic is included, are reacting to contingencies who interpret exclusion as one more bias against chiropractic. Those who desperately want to be "accepted" and to be treated like a "real doctor" are often the most vocal. Their "victim" lifestyle and "scarcity" outlook on life was soothed in the recent past by the willingness of insurance companies to pay the exorbitant office visit fees that were based on the medical doctor's office visit. Fees that were based on the notion that a patient would be seeing the doctor only once or twice. "But we deserve it," rationalize many chiropractors, "After all, we're more effective with low back pain and whiplash cases anyway." Remember, this medical model fee structure is so unfair, so unworkable, and so "wasteful," the bureaucrats in Washington feel inclined to "fix it."

Doctors interested in being included in whatever becomes the nation's health plan overlook the idea that if chiropractic is included, Medicare will likely be the operational model. Would you want more than 12 visits if you were hit from behind at a stop light? Have you already used up your 12 visits this year?

The million dollar practice and the chiropractic millionaire became the professional icons of the late 1980s. Fueled by seminars on how to hire poorly paid associates to process personal injury cases, attracted by the easy money from administering multiple therapies (unattended if possible), and inspired by a burgeoning legal industry, chiropractic changed. Computer software, fax machines, electronic filing, and other techniques were acquired to extract the patient's insurance money as quickly and efficiently as possible. No out of pocket expenses, huge yellow page advertisements, and even television commercials became the rule. The objective was to attract as many new patients with $100 deductibles as possible.

Were these millions of patients helped? Of course. Did many of these patients give chiropractic a try because it was covered by their policies? Sure. Do these patients understand chiropractic? I doubt it. Like those who gorge themselves at the eight meals offered each day on the cruise ship, patients took advantage of their policies with little interest of fully understanding or appreciating chiropractic. Frankly, few doctors were interested in slowing the assembly line to educate, inspire, and provide the incentives to encourage these patients to adopt a "chiropractic lifestyle." As a result, most of those patient files in the office "trophy case" belong to people who perceive chiropractic as a luxurious natural form of aspirin or as merely the last resort before surgery.

Too bad.

What really happened was chiropractic became too expensive. Instead of maybe one dollar of diagnostics to every ten dollars of actual patient care, the chiropractic figure rose to that approaching medicine. As the cost of this new and "improved" chiropractic care continued to rise, as their incomes rose, many chiropractors leveraged their futures with houses on the hill, luxury cars, and other accessories so they could permanently validate themselves. Going into debt was a way to prove their admittance into the health care mainstream.

No wonder what happened next. Slowly state legislatures, burdened with increasingly higher worker's compensation cases, saw that cutting or reducing chiropractic benefits, while minuscule, was among the easiest places to start. Corporate benefits managers saw HMOs and PPOs as effective ways to reduce and control costs. Slowly, like the frog who attempts to adapt to the slowly warming water in the beaker and ends up being cooked, chiropractors are waking up to the smell of coffee--accompanied by something that smells a lot like poached frog.

As deductibles continued to rise, many patients ended up with a form of catastrophic insurance. Unfortunately, the care needed to help relieve a patient's low back pain or headaches rarely reached the increasingly higher out-of-pocket requirements of their policies. This, combined with more and more patients who lacked insurance coverage altogether, prompted more and more doctors to start feeling the pinch. On one hand they wanted to keep their fees as high as possible to capture every dime from the occasional personal injury case, but on the other hand, more patients were showing up as cash patients and finding it difficult to afford more than the most minimal amounts of care.

The way many offices treated this symptom was to have the patient sign a "financial hardship" agreement. In this way the patient had to admit to the shame of not being able to afford chiropractic care and that the fee extended was "not the doctor's usual and customary fee." This double standard has not only sabotaged the front desk's efforts at collections and angered patients who discover they pay more than the person waiting next to them, it has caused many patients to question the integrity and ethics of the doctor!

When so many patients have "special considerations" which significantly lower your fees, a jury of your peers would conclude that your hardship fee is your usual and customary fee--not the inflated price charged to insurance companies.

If you still find it easy to sleep nights and face yourself in the mirror in the morning, read on.

The decline of insurance is relatively old news for most of the profession. Yes, there are still a few pockets of good insurance money left, but the clock is ticking. The hot topic in the halls at state association conventions is managed care.

"I've got to join because my whole town belongs," whines a doctor facing capitation of 12 adjustments at $20 a piece. "I'm going to join and spend the six visits I get, to educate the patient about the value of long term care and get them to pay me out of their own pockets," plans a different doctor in a different town.

The first doctor has given up. And while she continues to get checked or adjusted at least twice a month (and intends to for the rest of her life), by accepting the HMO vision of chiropractic, ends up denying her patients the same opportunity at truly maintaining their health that she enjoys.

The second doctor quickly gets booted out of the HMO when the administrators learn that patients are being taught that their trusted HMO is shortchanging the patient by only allowing six visits.

Does it occur to anyone else but me that third parties, whether they are insurance companies, HMOs, or the government, interfere with the chiropractic doctor/patient relationship? Does it occur to anyone else but me that intervention by third parties tends to devalue chiropractic care? Does it occur to anyone else but me that the only way to practice true chiropractic (like you enjoy), and have the freedom to run your affairs as you see fit, is only possible by excising third parties?

But hope springs eternal. Examine the trends over the last couple of years. Based on the recent past do you predict a future of less paperwork? Or more? Do you predict less accountability? Or more? Do you predict less justification for treatment? Or more? Do you predict less control? Or more?

How can you possibly imagine that you'll get to practice the way you want to, and offer your patients optimum care, if someone other than the patient pays the bill? How can you expect patients to assume responsibility for their health if someone else assumes the financial consequences for them? If you thought patients were irresponsible when Blue Cross was paying the bill, wait until Uncle Sam picks up the tab!

Of course the fear is that confronting, accepting, and acting on these realities might reduce your income. Or require that you work harder to increase your patient volume enough to make up the difference. You are probably correct on both counts. Why not get started today?

There is only one example I know of that substantiates the case I'm trying to make. It's the way chiropractic is handled by the Province of British Columbia in Canada. Chiropractic is a covered benefit in the Provincial plan. But it's limited to 12 visits a year, and no X-rays. Fortunately, the most visionary doctors, the most effective communicators, and the most confident chiropractors can "opt out" of the plan if they choose. Instead of limping along, looking for the next new patient with an empty dance card of 12 visits, these doctors have practices worthy of envy. Like the volume practices of the 1950s, 1960s, and 1970s (before insurance "equality") these offices are sticklers for patient education, patient accountability, and demand that patients pay for their care out of their own pockets. We're not talking about a box on the wall either. But what they are collecting is probably less than what you're extracting from your increasingly rare insurance patients.

Think back to the deregulated cash days of the 1970s. Before super bills. Before I.M.E.s. Before the clutter and confusion. A loaf of bread was around 50 cents. A chiropractic adjustment was about ten bucks. The legendary volume practices of the past were crammed full of patients who understood chiropractic to be more than a modality for the relief of low back pain. These patients brought their families in and would be willing to bail their chiropractor out of jail. Compute the cost of living increases since then and you'll find it difficult to justify $35 adjustments and $15 experiences lying face down with electrodes stuck to your neck.

If you've ever lived by a noisy freeway, a busy airport, or added a grandfather or cuckoo clock to your home, you were probably surprised by guests who remarked about the traffic or the interesting sounds your clock made. You had gotten so accustomed to the sounds that you didn't hear them anymore. Your reticular activating system filtered out the sounds as being unimportant to your safety or survival so you could focus on more important data about your environment. This is what has happened over the years with many doctors on the subject of financial policy. Doctors who get adjusted as often as they want, without waiting, and without reaching for their wallets, have lost touch with the financial realities their patients face.

Here are some ideas you might want to consider as you rework your financial policies to keep in step with the changes being wrought by forces outside your practice. Some will be easy. Others will be painful. Most will require working harder and making less money. Almost all of them will be easier to implement if done before you are forced at gunpoint to make changes.

Stop taking assignment: Remember, it was chiropractors who taught patients that the concept of assignment even existed! Afraid a patient might run down the street to a chiropractor still willing to take assignment? Many doctors who have already taken this step, report that when the claim forms come from the patient, that insurance companies are much more lenient with the amount of care that is ultimately reimbursed. It's kind of ironic that in an effort to smooth out the money pipeline, many doctors end up actually reducing the patient's coverage!

Start discussing financial policy: Many doctors are surprised to learn that offices in which the doctor discusses financial issues with patients have better compliance and better collections. The fact is, financial issues are part of the healing process. Not only because necessary care can exceed the financial resources of many patients, the worry that accompanies this type of pressure can interfere with compliance and ultimately the results that they may experience. Afraid that with your "soft touch" you'll give away the store? All it takes is a few phone calls from some overdue creditors to acquire the necessary discipline. It'll be good for you. Delegating financial policy matters to staff members is probably partially responsible for the way things are, anyway.

Provide a variety of choices: Offices that had the foresight to deal with issues a year ago or more, have responded with a variety of ways to make chiropractic care affordable. They present patients with a menu of ways to pay for their care. Depending upon your state laws and your ability to fully extricate yourself from assignment, consider designing different types of plans from which patients can choose. Idea #1: Unlimited care for a fixed monthly, quarterly, or annual fee. Include the X-rays, examinations, and all the other stuff you think are clinically necessary. Patients come out ahead during the early part of the plan, and you make your profit later as you are able to demonstrate results and convince patients of continued care. Perhaps unlimited sickness care at one price and unlimited non-symptomatic care at a different price. Idea #2: The first adjustment is, say, $75, the second is $70, the third is $65, and so on until you reach a baseline fee that you extend to all non-symptomatic patients. Doctors that want more maintenance care patients, will find this idea interesting because it so directly correlates symptoms with a higher fee and tends to reward wellness care. I'm sure there are many ways to design and implement a fee policy once you let yourself out of the tyranny of "we've never done anything like that before."

Increase the value of your service: Of course this is my favorite and first choice way to deal with the changing financial arena. Use better patient education, improve your office environment, enhance the experience patients have in your office, refine your tableside performance, and make being in your office more fun. Give your patients more than they pay for by honoring their time, raising their self esteem, and thinking of the millions of ways you can demonstrate your interest and concern in their lives.

Consider Japanese-style pricing: In America we tend to dream up a product or service, compute how much it costs us to produce, add an arbitrary amount for profit, and hope people will part with their money. The Japanese create a new gizmo and they research the market and try to determine what price it would take to own the gizmo market and discourage others from competing. What pricing structure would you have to adopt to remove the financial barrier preventing your current patients from continuing care after their symptoms subside, and reactivate a sizable portion of your patients who have dropped out? How much would you have to lower your overhead? How much would it increase your daily volume?

Simplify your practice: Many offices are still using the same admitting forms, office procedures, and report of findings that they found effective eight years ago when everyone had insurance. Question the status quo. Would you still administer your therapies if insurance companies didn't reimburse for them? Do you still need as many staff members? Does the office layout still make sense? Does an open adjusting theater make sense at a time when building patient rapport is so important? Does the size of your office still make sense? Cut out the dead wood now! Simplify. Streamline. Focus.

Do some of these ideas make you uncomfortable? Then come up with some better ones. The self-righteousness and indignation you might feel does little to change the fact that your reception room and next week's appointment book pages aren't as full as they could be.

Live by the sword, die by the sword.

Excerpted from
Making Change
Originally published in 1995
240 Pages
US $24.95

Not a reader? Bill reads his favorite chapters from all nine books on Bill's Best.