I know two Oncologists who are being pushed out of private practice by Medicare price controls. Why are they losing money on their practices? Medicare price controls on their services, despite the huge costs of chemotherapies.
As I understand it, chemotherapy administered in a hospital can be charged at a higher rate than in an office. Thus it is viable for a hospital to take over a private practice and make money, or at least break even, on it.
Interesting article on government medical care price controls: Confessions of a Price Controller. A quote:
Medicare ignores the market, setting prices for physician services based on an academic theory with its roots in the Soviet Union and implemented by the American Medical Association. Those prices do not reflect the value patients receive from their care, and they do not reflect shifts in the demand for particular kinds of services (such as primary care) as the population ages or as more people have health insurance.
Here's what I do: I teach, for free. I work at an urban charity clinic where I donate my time. (I have no idea whether, if, or how the clinic is compensated.) I have a private practice in which I adjust fees in order to consult anybody who is referred to me. I accept no insurance plans, no Medicare, no Medicaid. All I have to worry about is covering my monthly bills.
Docs with high overheads - large staff, machinery, materials, high rents, high malpractice insurances, etc. do not have the luxury of operating as I do.
I count myself as very fortunate to be able to have an old-fashioned practice. I can do whatever I chose to do, and I like it that way.
