Yes. I've learned a lot about this from doing the work I do:
1) The top amount for providers that have a sliding-scale system is an amount that very few people are actually charged, and those who are charged that amount generally CAN afford it.
2) One hour billable service time =/= one hour of work. As a rough estimate, it's reasonable to expect that one hour billable service time = somewhere between 90 minutes and two hours of work.
3) Providers have expenses other than their own take-home pay. There are payroll taxes, professional liability insurance costs (overstated in some circles but NOT nonexistent), rent/mortgage and utilities, professional licensing fees, the costs of meeting continuing education requirements, the costs of maintaining office staff, etc.
4) Insurance companies seldom if ever pay the full rate. Medicaid is particularly notorious for paying only about 66% of the full market rate for anything, which drives the market rate up higher for self-pay and people with other insurance. Even commercial insurance plans, IIRC, generally reimburse somewhere around 80-85% of the full rate.
An hour of billed time for my doctor has to cover probably somewhere around 90 minutes of his professional time, plus the appropriate wages of his nurses and his clerical staff, plus a share of the costs for contracting with an after-hours answering service, plus a share of the rent and utility costs for the office, PLUS a share of the cost of materials - everything from disposable gloves to exam tables. In addition, if the amount that insurance plans are willing to reimburse is low, there is pressure to inflate the costs beyond this to be made whole by the amount that insurance companies are willing to pay.
Oh, and those $20 co-pays? They may add up for you-the-patient, but they add up for the doctor, too, if they aren't paid!
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branchandroot
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Date: 2010-03-21 06:02 pm (UTC)1) The top amount for providers that have a sliding-scale system is an amount that very few people are actually charged, and those who are charged that amount generally CAN afford it.
2) One hour billable service time =/= one hour of work. As a rough estimate, it's reasonable to expect that one hour billable service time = somewhere between 90 minutes and two hours of work.
3) Providers have expenses other than their own take-home pay. There are payroll taxes, professional liability insurance costs (overstated in some circles but NOT nonexistent), rent/mortgage and utilities, professional licensing fees, the costs of meeting continuing education requirements, the costs of maintaining office staff, etc.
4) Insurance companies seldom if ever pay the full rate. Medicaid is particularly notorious for paying only about 66% of the full market rate for anything, which drives the market rate up higher for self-pay and people with other insurance. Even commercial insurance plans, IIRC, generally reimburse somewhere around 80-85% of the full rate.
An hour of billed time for my doctor has to cover probably somewhere around 90 minutes of his professional time, plus the appropriate wages of his nurses and his clerical staff, plus a share of the costs for contracting with an after-hours answering service, plus a share of the rent and utility costs for the office, PLUS a share of the cost of materials - everything from disposable gloves to exam tables. In addition, if the amount that insurance plans are willing to reimburse is low, there is pressure to inflate the costs beyond this to be made whole by the amount that insurance companies are willing to pay.
Oh, and those $20 co-pays? They may add up for you-the-patient, but they add up for the doctor, too, if they aren't paid!