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Health Care Reform:

Health Insurance & Affordable Care Act

The HMO Fiasco

A doctor speaks out.

WebMD Feature

June 19, 2000 -- A young woman sits in front of me with tears in her eyes, so grateful to have finally gotten an appointment in my office. She has end-stage liver disease and will need a liver transplant. She recently moved to our community so that she could live with her sister and find a good doctor close to a transplant center.

After two months in our system, she has seen three different doctors, but none would spend more than fifteen minutes with her. When she heard that I had a reputation for spending extra time with my patients, she asked the health maintenance organization (HMO) to transfer her care to my office. During 30 years of experience in my field, I have cared for many patients like her. I will make sure she survives to receive a liver transplant.

What's Wrong With This Patient?

What is it about this perfectly nice young woman that aroused so little compassion from her doctors? Nothing about her would make her an undesirable patient -- except that she is sick and will need a lot of attention. In the past, when doctors assumed responsibility for complex cases, they were reimbursed in a manner proportional to the amount of their time required. Now, under the so-called "capitated" payment systems used by most HMOs, they are paid a small fixed fee per year for each patient, no matter how many visits, operations, or hospitalizations are needed.

In my community, this fixed fee is so small that if a patient needs to be seen more than two or three times a year, the physician will actually be working for nothing because the fixed costs of seeing the patient (including secretarial time and paperwork) are not paid for by the HMO, but come right out of the physician's pocket. It is not an exaggeration to say that this payment system makes every sick patient a direct financial liability to his or her doctor.

Needless to say, the physicians who care for the greatest number of sick patients are penalized because they need to spend more time with each patient and can't see as many overall. It is the number of patients -- not the time spent with each -- that determines a doctor's income.

In most communities, the doctors who care for the sickest patients are highly regarded by their peers. They are the "doctors' doctors."

Far from being supported or encouraged by the HMOs, these doctors receive letters and lectures exhorting them to be more "efficient," meaning "spend less time with each patient and order fewer tests." The implication is that they just don't want to work as fast and hard as their more "efficient" colleagues.

Free Care for the Rich?

Doctors traditionally have been expected to provide free care for the poor. It is only now in the age of the HMO that they also have to provide free care to the rich, who assume, quite reasonably, that their doctors are well paid. It's true, the HMO insurance premiums aren't cheap. Someone is getting the money, but it's not going to the people who actually provide the care.

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