Vachette Pathology

Last week I attended a meeting in D.C. where Rep. Pete Stark, D-CA, was speaking on the national healthcare plan. This was an interesting experience as I received a first hand look at how the new plan may play out. At this point there is nothing written in stone, but you can be fairly certain something will be passed on this issue and it looks like it will take place before Thanksgiving.

One of the more interesting things I heard was the concept of a “productivity adjuster” being included in this 800-page bill. The idea of a productivity adjuster seems to be something that was created by the government to echo the private insurance industries budget-neutral adjustment model. The overall goal here is to keep costs from rising by changing the payment formula to keep payments the same year to year. This means they are actually paying less for those that are more efficient. In fact you can argue this is in essence a non-productivity adjuster.

The new healthcare plan also has some interesting concepts concerning productivity. The government is strongly pushing a “pay-for-performance” platform; however, under their proposal, this is a pay for non-performance plan. Those that are more efficient-the top performers-will be paid less under the plan for their effort, not more. This eliminates the motivation to become more efficient, as one’s compensation is not rewarded but negatively impacted.

Using these concepts, you can easily see the major problem that seems to plague Washington at this time. How do you keep things budget-neutral? If the government gives you a Consumers Price Index (CPI) increase every year, they have to take in more money than they pay out to cover these costs- unless you are in the banking or automotive industry; they of course have a separate set of rules. But I digress…

Instead of giving providers a CPI each year, they are working hard to keep things budget-neutral; thus the use of a productivity adjuster. According to these rules, a student who has just graduated and is new to the industry should get paid more than someone with 12 years of experience; as the experienced pathologist is more productive. 

Another concept being considered is a negative Cost of Living Adjustment (COLA) that would decrease payments 1.75% per year over the next five years. 

When you hear the new healthcare plan will cost you nothing, remember it is actually costing you your livelihood. Add this proposed decrease of 1.75% to the actual COLA change which is on average of 2.9% per year, and that is a about a 4.65% decrease in actual revenue.  

This means you will be getting about 4.65% less revenue from your government payers. Also, there is a proposed 3.6% tax increase on people who make over $250,000. Most pathologists gross this much.  So the final total: an 8.25% decrease in your income. You could argue that you will get some of this revenue back when the uninsured are actually insured, but it is quite possible that any revenue you may get from this program will be lost trying to fight the whole new bureaucracy that wil lbe developed.