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Financial forces that the public knows little about play in the relationships between doctors and their patients. Rewards and punishments from insurance companies and regulators exert a powerful influence over your doctor's decisions.

Patients expect that their doctors will make the choices that are best for their ongoing health and wellbeing. And doctors, to be fair about it, usually want to do what is best for their patients. But financial forces are eroding the relationship of trust between doctor and patient. 

What are some of the rewards and punishments that push doctors to act in their own best interest rather than the best interests of their patients?
  • Pay for performance provides cash payments to doctors whose patients meet preset goals regarding certain health outcomes, such as cholesterol levels in the general public and HbA1C in diabetics. If patients meet their treatment goals, the doctor gets extra money from insurance companies or an HMO. If patients do not meet their treatment goals, the doctor gets just the small fee negotiated for office visits and other services. The problem with this kind of compensation is that not all patients respond to treatment at the same rate or with the same results, and the payer does not take into account different interpretations of lab results that experienced doctors may hold.
  • Higher doctor ratings are held out as a reward for doctors whose patients achieve the numbers rewarded by an insurance company. If patients get their blood pressure down, or they get their cholesterol down, the doctor is recognized for "physician excellence" or some version of providing a "bridge to excellence" on the insurance company website. The doctor gets more patients, and these patients also may be billed lower co-pays. When the doctor's patients don't have good numbers, the doctor may lose recognition, and get fewer patients, and the patients may also have higher copays. (Not every plan penalizes patients by raising or failing to lower their copays on the basis of what the doctor's other patients do.)
  • Metrics, metrics, and more metrics are required of doctors in all of their activities. Insurers and regulators tend to look at cut and dried numerical data, causing doctors to "treat the numbers." Focusing on lab results rather than patient happiness is inevitable in today's fast-paced medical technology. It can take 10 to 20 years for doctors really to know whether a given medication successfully prevents or treats a disease. In the meantime, doctors rely on the numbers they get in lab reports as a surrogate for wellness. To get the right numbers, doctors may withhold treatments they really think would work better, and give treatments that may cause serious side effects. Sometimes doctors prescribe drugs that get the right numbers because they know that insurance companies will not pay for the medications they believe are more appropriate.

Insurance companies also influence the specific medications that doctors prescribe. Most companies create a disincentive for patients to be treated with certain drugs that are new or just expensive.

An insurance plan might offer $0 copays for generic drugs but charge up to half the cost of "third tier" drugs--which can amount to tens of thousands of dollars in patient costs.

On the other hand, some companies pay doctors to prescribe specific drugs. One company pays oncologists $350 per month per patient to prescribe a specific drug, which may or may not be the best choice for the patient.

And no insurance company rewards doctors who refer their patients to the best medical care if that care happens to be out-of-network.

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