It’s a scary proposition for many physicians and practitioners in the integrative and alternative health field – going insurance-free. On the one side, you feel that many of your patients may leave should you ask them to pay for their healthcare expenses out-of-pocket. On the other, it can provide you with more freedom, better patient results, and revitalize you and your practice. It’s a difficult decision for any doctor pondering the switch.
But with insurance premiums skyrocketing as much as 78%, a rising level of dissatisfaction from both practitioner and patient with the care and options available, and so many integrative and alternative treatments that show great clinical promise falling out of coverage, the decision may be easier than you think.
8 Reasons to Opt-Out of Insurance and Go Cash-Only
“I think cash-only practices are more likely to expand throughout the nation…Physicians are angry, and they are tired of the insurance company abuses that they feel.”
– Dr. Lori Heim, President of the American Academy of Family Physicians.
- Offer Better Patient Care
The main focus of any doctor should be on healing the patient. This is what is called a ‘Patient-Centric Results-Based Model‘, in which the most critical and paramount goal (or top of the pyramid) is always to produce the highest levels of patient success through the complete restoration of health. All subsequent levels are therefore optimized to achieve this goal, and doctors / practitioners who work in this model focus solely on healing, rather than be troubled with other administrative and non-medical tasks.
Running a patient-centric model is in contradiction with an insurance-run practice, in which a large portion of focus that should be directed towards the patient is spent on paperwork and insurance claims. This leads us to our next point…
- Spend More Time with the Patient
Doctors are spending less time with their patients than ever before. Research has calculated the average time a physician spends with the patient is approximately 8 minutes. The majority of time spent being a doctor is now occupied by paperwork. Now imagine another scenario where a physician is free to spend 30 minutes + with the patient, provide better personal care, and ensure financial abundance. All of this is possible, and it starts with releasing yourself from the pitfalls of medical insurance claims. By freeing yourself of the time constraints due to claims and paperwork, direct pay practitioners allow more time with the patient, building relationships and a better understanding of the complexities of their current state of health. This in turn leads to improved and more dedicated patient care, and better results.
- Increased Patient Compliance
Believe it or not, patients care more about feeling good than many doctors realize – so much, that they will gladly pay top dollar for it. Providing a patient with the time and passion that they require is understood to be a premium service in today’s environment, and a growing number of patients are accepting this gladly. In a JP Morgan article entitled “Key Trends in Healthcare Patient Payments“, the financial institution found that one of the top trends in the medical field was an increased responsibility for healthcare payments. In fact, a McKinsey study that was referenced within the article found that 74 percent of insured consumers indicated that they are both able and willing to pay their out-of-pocket medical expenses up to $1,000 per year.
Dubbed “Self-pay patients“, this growing group has opted out of premium healthcare plans, going for bare-bone emergency care (high deductible plans, HSA accounts, etc.), and paying directly for their primary care. The result? An improved doctor-patient relationship and a more compliant patient. The mere fact that all costs of their health program are presented and their is a level of transparency and honesty places a value to their treatment, and that the money they are spending on healthcare is an investment that requires them to be responsible for the outcome.
- Freedom – Cut Out the Red Tape / Middle-Man
In a national survey of doctors published last May in the journal Health Affairs, it was determined physicians spent an average of 43 minutes each workday processing and working on insurance paperwork. That lost time costs practices a combined $31 billion each year, the study concluded, or nearly $65,000 per doctor. Going insurance free provides freedom and shifts the pendulum of power from the insurance companies back to your medical practice.
Many doctors, such as Dr. Thomas K. Szulc, Medical Director of the New York Center for Innovative Medicine seem to agree:”I think the most important aspect of dealing with insurance is the fact that if doctors accept payment from third party payers, they are essentially giving up some power and the insurance companies then control a segment of their practices. Unfortunately, insurance limits doctors practices by disallowing treatments which doctors consider appropriate and best suited for their patients and force them to use secondary therapies that are not always most beneficial, only for the fact that they covered by insurances – this does not place the patient first.“
- Choose Treatments Because They Work – Not Because They’re Covered
It’s hard to rationalize purchasing an expensive piece of medical equipment if you’re an insurance-based practice and insurance simply will not cover the use of the equipment, regardless of its therapeutic benefit to your patients. And more and more, insurance companies are limiting not just specific therapies, but also the number of treatments they will cover. Turning to Dr. Szulc again:
“If a patient requires 10 treatment sessions, an insurance company may only allow 6 or so. Doctors are losing their freedom to practice medicine according to their knowledge and best interest for the patients, who put their trust in doctors’ hands. A secondary problem is that most beneficial non-allopathic therapies of integrative medicine are not covered by insurances which continuously deny payments for services. This creates a big dilemma and feeling of entrapment between insured patients, insurance companies, and physicians, who need to be reimbursed for their services in order to maintain viable practices. At the same time, patients believe that they are covered for their healthcare needs and that perhaps the doctor is not being completely honest with them and taking advantage of the situation by stating that the patient requires additional payment for services which are not covered by insurance. It creates an unhealthy situation and does not promote a healing atmosphere, but rather an environment of distrust and confusion, even in the most compassionate and dedicated medical practices.”
- Get Back to Your Roots and Reclaim Your Inspiration
Most doctors got into medicine to help people, not to worry about claims, reimbursements, and whether a therapy or program of treatment will be covered by insurance companies. Very often, over time, physicians who came out of medical school with an eagerness to do good become disenchanted and beat down by the system. A dejected feeling comes upon them, and the passion of practicing medicine escapes them. If this is the case with you, change is needed – and one of the best ways to add inspiration and excitement to your calling of medicine is to free yourself from the bureaucracy of insurance and practice the way you truly want to. Not only will you feel better, but patients will pick up on your zealousness to help them.
- See Fewer Patients, yet Flourish Financially
It’s a misconception that going insurance-free means that you will have to charge less for your services and you won’t be able to survive. To the contrary, doctors who opt-out of insurance and go cash-only should be charging more for their premium services. Remember, you’ll be able to provide more time, attention, varied treatments, and invest more of yourself with the patient to ensure their restoration of health. This value-added approach to medical treatment improves on quality, allowing practitioners to see fewer patients, but charge more per patient and achieve higher levels of success. Referrals from a direct pay model are often very high.
- Better Understanding of Cash Flow
Insurance can cause an accounting nightmare. When dealing with insurance, cash flow, medical insurance reimbursement and revenue issues can be dramatically impacted. Medical billing can become quite complex with insurance, with many practices running reports to reflect the practice’s insurance accounts receivable and a separate report for patient responsible accounts receivable. What money is coming in and out can be hard to trace, and the financial strength as well as a true understanding of cash flow becomes difficult. In addition, claim denials pose another problem.
Going insurance-free removes these problems, greatly reduces uncertain accounts receivables, and provides you with an accurate assessment of both cash flow and your practice’s financial decision. This can improve financial decision making and greatly reduce time and money spent on billing issues.
How to go Insurance-Free
Now that we’ve shown the benefits of making the transition to a cash-only practice, here are some tips to implementing this change:
- Inform Your Current Patients
It is proper practice to provide your current patients with a letter informing them of your decision to take your practice insurance-free some time before actually initiating the change. This has become common with many conventional internists and Medicare (see article), although your letter should not focus on just financial reasons. This leads us to the next point…
- Be Honest, but Firm
In the letter as well as all following communication with your current patients, be sure to be honest about your reasons. While many doctors blame diminishing reimbursement rates and large amount of paperwork, this may come off as another physician only out for the money and not looking out for the best of the patient. Stress that you believe each patient deserves the very best care from your practice, and after deliberation you have concluded that in order to provide patients with the care and results they deserve, you will be choosing to forego accepting insurance. Some may not be happy, but reassure them that because of this decision, you will be able to provide more treatment options, more time, and better care.
- Opt-Out Forms
Your first step in going insurance-free is informing your patients and obtaining consent from the patient that they understand that they are responsible for payment of all services, and that they agree not to submit a claim. Essential pieces to include in an insurance opt-out form are clear wording that the patient understands all services are to be paid by the patient in the form of your choice (cash, credit card, check, etc.), patient agreement not to submit a claim (or to request that physician submit a claim) to their insurance company, patient acknowledgement that they have the right to refuse and seek other physicians or practitioner that have not opted-out of insurance, and the patient understanding that any insurance payment will not be made for any items or services furnished by the physician that would have otherwise been covered by insurance if there were no private contract and a proper insurance claim were submitted.
The following link provides 5 steps to opting out of Medicare:
» 5 steps to opt-out of Medicare
- Provide Options
Many believe that by going insurance-free, you are alienating lower to middle-class patients who do not have the disposable income to pay for medical services out-of-pocket. While many patients may in fact take the stance that paying out-of-pocket is simply not realistic, practitioners may be pleasantly surprised to see how many patients value the quality services that they know will provide them the best opportunity to live a healthy life. Many will gladly sacrifice a larger purchase or travel plans to ensure their health is restored.
One option to help patients with limited finances is to provide them with financing options from well-established organizations like CareCredit. Patients should also know that a percent of healthcare expenses may be tax deductible. Some practices construct a section of their websites or print information to provide to patients about their options, and link to other resources that answer questions such as “Can I claim medical expenses on my taxes“. Finally, you may choose to offer some patients pro bono medical services. As you will see, when you can provide patients with quality care and the limitations imposed by insurance companies are stripped away, you will find yourself with more opportunities to provide unreimbursed care to these that desperately need it and simply cannot afford it.
- Have Confidence in Your Decision
The switch to going insurance-free is not for everyone, and you must be confident not only in your decision, but yourself. If you provide high quality integrative care, have proven yourself as a practitioner who gets results, and are confident in your skills as a practitioner, the choice becomes much easier. Even if in the beginning, a portion of your patients leave, you must remain confident that this was the correct decision and in the best interest of your patients. New patients will pickup on this, and as the freedom from going insurance-free kicks in, and your therapeutic options and level of quality care increases, patient results will improve. Results talk louder than anything, and patients from other clinics and practices will notice these results. Ask yourself, would a patient rather be in the insurance system and barely managing their condition for years, or go to somewhere that has a proven track record to restore health in the most efficient manner possible, even if they need to pay out-of-pocket? This may help instill confidence as you transition your practice.
Change can be difficult, and scary, but change is also a critical component of growth and improvement. The medical field is at a crossroads, and rather than continue doing the same things that have led us to the problematic state we find ourselves in, taking bold steps and implementing changes that may go against conventional wisdom is precisely what is needed. Going insurance-free can absolutely serve as a catalyst to take your practice to new levels, and offer patients the very best care possible. In the end, if doctors place the patient first, success will follow.
“All practitioners and practices have to have a proper philosophy towards healing and total conviction and dedication for the well-being of their patients. But in order to regain freedom and embrace this approach, one must often make the choice of going insurance-free and believing in themselves.”
– Dr. Thomas K. Szulc, MD, New York Center for Innovative Medicine.
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