12 Changes That Will Affect Doctors' Income in 2015

Leigh Page


November 25, 2014

In This Article

2. Continued Drop in Malpractice Premiums

After years of skyrocketing increases, malpractice premiums are undergoing a prolonged drop that is expected to continue into 2015. Malpractice insurance premiums for three bellwether specialties—ob/gyns, internists, and general surgeons—decreased this year for the seventh straight year, according to an annual premium survey[4] released in October by Medical Liability Monitor. Although physicians in certain specialties or in certain states are still being socked with high premiums, the three measured specialties have seen a 13% decline in premiums nationwide since 2008.

In large part, the decline is due to the delayed effect of tort reforms, some of which were passed many years ago to no immediate effect, according to Greg Roslund, MD, an emergency physician in Cleburne, Texas, who has analyzed each state's malpractice climate for a series[5] in the American Academy of Emergency Medicine publication. When a reform such as a $250,000 cap on noneconomic damages is enacted, he said, its effect on the number of lawsuits and ultimately premiums varies widely from state to state, depending on the malpractice climate.

"The climate trumps the law," Dr Roslund said. For example, when Florida and Illinois enacted caps, plaintiffs and plaintiffs' attorneys continued to file a high volume of lawsuits. (Illinois courts struck down that state's cap, and Florida courts are in the process of doing the same, Roslund said.) Sometimes, he said, it takes a while for the cap to have an effect, as happened in California, and in other cases it has an almost immediate effect, as in Texas.

In addition to the cap on economic damages, Dr Roslund said, the most effective reform is the use of review panels made up of physicians to weed out frivolous lawsuits before they can be filed. The least effective reform, he added, has been limits on use of expert witnesses, because these provisions contain too many loopholes.

In the past, malpractice premiums have followed a cyclical pattern, and many experts believe they will eventually start rising sharply again. But Dr Roslund believes tort reforms will have a permanent effect. "The decline will flatten out," he said, "but I don't think the pendulum will swing the other way."

3. Will ICD-10 Finally Happen?

There have been so many delays in implementing the International Classification of Diseases, tenth edition (ICD-10), diagnosis coding system that physicians could be excused for doubting whether it would ever happen. But many people with inside knowledge are saying the deadline—October 1, 2015—will stick. "This time, it looks like the real thing," said Dr Wergin, the AAFP president.

The new coding system was supposed to start last year, but the Department of Health and Human Services, noting that many players weren't ready, postponed the start-up until October 1, 2014. Then in March, Congress postponed it again. Dr Wergin said another postponement was necessary because many small practices weren't ready yet, and there were concerns that some vendors and payers weren't up to speed, either.

Proponents say the new coding system is more precise, cutting down on coding errors and allowing for fewer denials and speedier payments. They also think it will be easier to use the new codes to assemble acuity data that can be used to negotiate higher reimbursements with payers.

But many physicians are skeptical. Dr Wergin said that in his own practice, he can easily track diabetes patients using the current codes. Critics also maintain that the new system will make physicians less efficient. Doctors' notes will have to be more specific in order to select the exact ICD-10 code.

As the new deadline looms closer, physicians' anxiety levels are sure to rise. "There is a concern that the technology won't work when the systems start up," Dr Wergin said. "You might not get paid right away." Some consultants, he said, are advising doctors to have 3 months of cash flow in reserve.

At this time next year, physicians will know whether all of their fear and loathing was justified. Perhaps the new government program will go off without a hitch. Or perhaps not.


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