NEWS: Discount Plans are not Insurance

Here is a story from the AP Wire today. Idaho is warning consumers that discount plans are not the same as insurance. We have labored to educate our own patients that Vision Plans are not true insurance, and in fact, drive the true cost of eye exams up. This fact is usually hidden from plain view by sophisticated marketing scemes and mandated discounts that lower the quality of the end product to the consumer.

If you think about it...a vision plan is a third entity (another middle-man of sorts) that seeks to profit from our routine transaction. True insurance on the other hand, profits from spreading risk and taking the very calculated risk that the premiums you pay will exceed the collective costs of your care.

See this earlier post about the difference.

NEWS: Why does Health Care keep getting more Expensive?

As reported in the Review of Optometry, January 15, 2009 issue, by the Nachimson Advisors, a health information consulting firm, just one of the incoming regulatory changes in the works for medicine is set to cost the average small practice like ours $83,290. Mid size practices (10 docs) will spend $285,195 on the upgrade, and large practices (100 docs) will spend an estimated $2.7 million.

At issue is medical coding. Currently, we use ICD-9 codes which define and describe a doctor's findings which are then linked to the procedure/office visit codes that get billed to your insurance company. In short, ICD-9 codes supply the "reason" for testing and office time for which the doctor is trying to get reimbursed. The problem, according to the Department of Health and Human Services (HHS), is that sometime next year, they will run out of codes in the ICD-9 set.

So HHS is getting ready to adopt a new coding system, the ICD-10 set. The goal is to have it in place by October 2011. Insider analysts think implementing the new ICD-10 coding will be the most costly event medical practices will ever experience.

Here is how it pencils out for us. Rough calculations that include our current costs and average revenue-per-patient collected indicate that our practice would have to see our next 757 patients just to pay for the switch to ICD-10. Of course, like any business, medical practices will need to recoup the added cost of this new mandate to stay solvent. But unlike the regular market place, medical practices can't just increase the rates they charge insurance companies for their service and expect the insurance companies to pay the increase. They will have to make up the difference with their private pay patients, or eliminate other overhead or services which may reduce the quality of care you receive.

ICD-10 coding for diagnoses is just one of the oncoming challenges we have to prepare for. The procedure codes we have to use that describe the time and testing we do in order to get paid is also getting more complicated by orders of magnitude (which is its own subject for another time.) We now have level 2 procedure codes and PQRI codes (quality assurance coding) to include when we bill, just so we can get paid without penalty.

Sometimes I wonder if the increased complexities in coding and billing are just a calculated effort on the part of payers to trim costs by virtue of our reduced compliance as we struggle to figure out and pay for the new programme. Understanding the current system is already so complex that keeping payments coming properly is a non-stop battle. We feel like we have evolved our processes to the point that it works fairly well, and we follow the rules to the "T."

Patients already get frustrated as they try to understand why we code and bill as we do. I fear the new regulations will add more layers of confusion between doctors and consumers of medical care, further separating the two from the normal market forces that control buyer/seller relationships in other market settings.

News: SCHIP expansion

The State Children's Health Insurance Program (SCHIP) was originally set up as a stop gap to cover children in families that made too much to be covered under medicaid programs, but presumably, not enough to afford health insurance. Currently, the U.S. Senate is getting ready to consider a bill passed by the House that would expand SCHIP after provisions to protect private insurance companies were removed.

At issue is the concern that public insurance "crowds" out private insurance. Several studies conclude that the effect of this crowding leads to more expensive insurance for those in the private market. Here is the reference to one such study for which I couldn't find an online source: David M. Cutler and Jonathan Gruber, "Does Public Insurance Crowd-out Private Insurance?" Quarterly Journal of Economics, Vol. 111, No. 2 (May 1996), pp. 391-430.

In my opinion, this represents a dangerous trend that will be nearly impossible to undo. Generally, this sudden rush to move private business into the public sector saps vital market energy from the productive segments of our economy--all at a time when our economy needs all the energy it can get. Click here for some solid analysis of the SCHIP expansion by the Heritage Foundation.

Dr. Gooch

Understanding the Difference Between Vision Plans and Medical Insurances

Today's health care environment has become more confusing and complex. Understanding your vision and medical benefits is not as easy as it once was. Our practice is providing this information to clarify many misconceptions about third party insurance and your vision. In order to understand the complexities of your coverage, it helps to understand that there are two distinct sides of vision care. The first is medical eye care which covers all testing, diagnosis, and treatment of eye disease. The second is routine vision for those with healthy eyes. Third party payers usually reflect that difference. As a general rule, medical insurance pays for medical eye care and Vision Plans deal with routine vision, the exception being that some medical plans will pay for routine eye care. What many consumers don't realize is that by virtue of the medical nature of eye care, MOST eye exams are covered under their regular medical insurance, and that you don't need separate "vision insurance" to be covered.

Many common vision plans ONLY cover the routine vision part of the overall eye health examination, i.e, VSP, Eyemed, Davis Vision, Spectera,etc. These plans are not really insurance in the traditional sense that they spread risk, but are much more marketing plans that drive patients to participating practices. By definition, it is impossible to "insure" routine things. The reality is, vision plans are a middle man, dressed up to look like insurance, that extract a profit from the routine business of eyecare. Since we also must profit from the routine business of eyecare to exist, the cost is passed on to consumers in ways that aren't immediately noticeable. Typically, the consumer pays the price of reduced quality, since providers who accept vision plans have to make up the dramatic discounts vision plans demand by increasing volume and playing games with their retail markups in their optical to remain profitable. Because we strongly believe we can offer higher quality care and better quality retail optical without the encumbrances of Vision Plans, we do not contract with third party"vision only" insurances. As non-participating providers, we will be happy to complete all the necessary forms, provide documentation and submit them on your behalf to the vision plan carrier for your reimbursement.


Understanding that are two distinct and important elements of every visit to our practice may help you understand the role of your medical insurance. Because many eye diseases that affect your vision will have little or no symptoms until the problem has become sight-threatening, all eye exams have a medical component. In fact, the most important goal of your visit today is to insure quality of life by providing you with a comprehensive, thorough medical examination of your visual system. Regular eye health examinations are critical to prevent debilitating eye disease, and can include the use of cutting edge technologies designed to take the guesswork out of disease detection. The second component of all comprehensive medical eye exams include a routine vision component to analyze and prescribe, if necessary, eyewear or contact lenses to correct your vision. Our insurance billing specialists will contact your insurance company before your visit is completed to verify your eligibility and coverage to maximize your insurance benefits.

Our doctors participate in the Medicare program and accept assignment on behalf of each eligible patient. The eye health examination is a fully covered service under the Medicare program when there is a medical condition, dry eye, cataracts, allergies, glaucoma, etc. However, as mandated by Federal law, the refraction part of the vision section of your exam is a non-covered benefit. There are many new Medicare Advantage plans with private insurance companies that we participate in.

Flex-spending, or Cafeteria plans are an option that your employer may offer which allow you to set aside pre-tax dollars to pay for your medical expenses such as eye exams, glasses or contact lenses. Please contact your employer to take advantage of this option.

Our billing staff are always available to contact your insurance company before your appointment is made to check your benefits for you. We are here to help you will all your insurance needs until your claim is completely processed.

--Barri

END OF YEAR FLEX-SPENDING ACCOUNTS...

The end of the year is fast approaching and if you have flex-spending accounts or cafeteria plans the time to use up those benefits is now! Did you know that you can use those funds towards eye exams, prescription eyewear, sunglasses and contact lens purchases? Give us a call and set up your appointment today! Please call, e-mail, or stop by our office for any questions! Happy Holidays!