Insurance payment lacking
The procedure took somewhat over an hour of the attending physician's time, plus needed medical supplies. When USAA finally got around to paying his clinic for their services, the reimbursement check they sent was a paltry $35. Included, was the tidy sum of $1 for the required X-ray, and around $30 for the time and materials needed to treat him and close the wound.
My doctor emphasized that minimum X-ray material costs alone, not including the labor costs of the X-ray technician or maintaining the X-ray room, were in excess of $15 per shot. The $35 which USAA allowed for the attending doctor and expended materials was nothing short of an insult.
He plans to let them feel his displeasure, for whatever good it probably won't accomplish. After all, the clinic in which he practices sold out to a large Seattle hospital. When I asked him if any doctor could make a living from such pay-outs, he replied, "Absolutely not!"
Insurers' promises are empty
In previous conversations he's hinted that he believes that the problems inherent in managed medical care began to afflict the medical profession when overworked physicians were won over by insurer promises to streamline physicians' paperwork processes, plus other malarkey, freeing up doctors to devote more time to healing bodies.
The result of the medical industry's lack of organization and jurisprudence in foreseeing this snake in their grass has led to near total insurer control of their industry. The insurance industry's promise was a common lie that has mesmerized numerous industries - collision repair among them - and promises to overcome more. It may be late, but we're getting smarter.
A December 1998 Washington CEO article, Frustrated Doctors Find Their Voices stated, "In the march to managed care, one of the more silent voices have been those of doctors… until recently. Why their lack of a consistent, unified message? Where were they in the discussion of managed care?"
Tom Curry, executive director and CEO of the Washington State Medical Association (WSMA), Washington's largest professional association of physicians continued, "There is a growing frustration on the part of physicians, even from those who have supported the concept of managed care." Curry says he hears complaints from physicians who see insurance premiums going up, while their reimbursements are going down… and that there is a huge transactional waste, among other maladies. The contracts have become so complex, fragmented and flooded with a systemic distrust, that doctors have presented some of these managed care contracts to their Insurance Commissioner to address pivotal key contract issues… such as who (the health plan or the physician) defines 'medical necessity'.
Patients become 'units'
Curry states WSMA has found "incredible isolation felt by most physician members… their office managers telling them they had to see so many 'units' per day because of the contracts they signed." He queried, "Can we really apply industrial, marketplace approaches to medicine?"
I might add, can we really apply the managed care approach to collision repair, and not defraud our true customer, the vehicle owner?
An October 25, 1999 U.S. News & World Report article, Is Your Doctor Lying For You, detailed some of the frustrations managed care has brought upon physicians seeking reasonable reimbursement and prescriptions for their patients. Many in the collision repair industry fraudulently employ "cost shifting" to make up for legitimate procedures and expenditures for which insurers often deny coverage: In the medical industry the same process is known by terms such as "fudging" or "gaming the system." The article expressed the frustration many doctors encounter in trying to give their patients top quality medical service and receive reasonable compensation for their services. "Appeal fatigue" (the cat and mouse game in which already overworked doctors have to spend additional countless hours arguing with managed care plan providers over reasonable procedures, drugs, and reimbursement, on behalf of their patients) takes a heavy toll on physicians.
Colostomy closure "not necessary"
One internist, when asking a managed-care plan representative to approve surgery to undo a colostomy so one of his patients " wouldn't have to defecate into a bag for the rest of his life," was denied insurer payment for the operation on the ground that the insurer considered the procedure "boutique medicine" (i.e. medical procedures performed to "improve quality of life," not out of medical necessity).
The article continued, for reasons this example illustrates, that many in the medical industry have reluctantly engaged in "fudging" (getting creative when filling out insurance forms) - rarely outright lying, rather, shading symptoms or conditions to get the care or financial coverage they need to stay in business while not jeopardizing patients' health needs. They might accomplish this end by using general codes for procedures and medicines for which insurers do allow coverage, rather than codes for the actual diagnosis of the problem which the insurer might deny.
The article closed by stating that "(though) some health plans do know something ["fudging"] is going on… so far, the legal consequences for physicians' 'fudging/gaming' the system has been minimal." But surely in the near future insurers' lawyers will be coming down hard on similar practices within the field of medicine, just as they will with collision repairers who "game" that system.
A popular Northwest physician, defended by an attorney customer of mine, was recently fined $400,000 and will be spending 35 months in prison for "systematically over-billing or otherwise misleading Medicaid, the state of Washington, and a host of health-insurance providers for years." Though the courtroom was packed to standing room only in an unprecedented show of support for the doctor by many of his patients, some who claimed his practices had saved their lives, and accompanied by hundreds of letters of support for the doctor, the U.S. District Court judge yet handed the doctor the largest penalty to date, insisting that her job was "to address the side that broke the law, and broke it repeatedly, for a long, long time." She continued, "The overall effect (of the doctors actions) on society as a whole is harmful - extremely harmful." But many of this doctor's former clients "faulted the insurance industry for leading the doctor astray through stingy and (very complicated) practices".
DRP is managed care for cars
Call it what you will, but Direct Repair programs are a form of managed care for cars. And the many similarities between the unreasonable procedural limitations and reimbursement restrictions that managed care programs (medical, Direct Repair, whatever) put on those who have the task of performing the repairs, is leading those employed in these fields into fraudulent practices.
The hands of many within the collision repair industry are far from lily white. But my opinion is that, since the insurance industry has the most potential for "honest-izing" service providers (being that they alone control the purse-strings), insurers are more to blame since it is they, through often unreasonable fiscal measures, which have taught or at least opened the "Pandora's box" to many service providers to lie and cheat, in order to stay in business.
Dick Strom is the owner of Modern Collision Rebuild on Bainbridge Island, Washington (firstname.lastname@example.org)