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Get Out the World's Smallest Violin: Many Texas Doctors Say They're Making Less Money

Texas doctors are in a passel of trouble because of adverse economic conditions, according to a new survey by the Texas Medical Association (TMA). But only 5 percent of them closed or sold their practices in 2010. So small-practice doctors are trying to hold on even as they have a harder time coping with sinking reimbursements. One wonders how long they'll be able to do that, however, as Medicare and Medicaid payments drop and more people become uninsured.

In the survey of 3,580 physicians, 61 percent said their incomes had declined in the previous two years. Sixty-nine percent said they had cash-flow problems because payments from government and private insurers had arrived late.

Fifty-one percent of doctors whose practices had cash-flow problems said that they had drawn down their personal bank accounts to keep going. Thirty-three percent of the doctors in this category said they'd borrowed money to keep their practices afloat. Both of these percentages were substantially higher than they'd been in a 2008 survey.

Of the physicians with economic woes, 33 percent laid off employees. Twenty-three percent terminated or renegotiated health plan contracts, and 20 percent reduced or terminated services to government payers such as Medicare and Medicaid.

Texas doctors -- like physicians elsewhere -- are increasingly frustrated about government payments. Texas has already begun cutting Medicaid reimbursement, and Medicare payments have barely risen at all for a decade, although Congress has headed off major cuts for this year. Forty-two percent of Texas doctors still accept Medicaid, and two-thirds take Medicare.

The AMA warns that Medicare patients are having a harder time finding physicians who will serve them in Texas and 19 other states. And another TMA survey found that Texas doctors are leaving Medicare in increasing numbers: 172 practitioners stopped participating in the program last year, and 450 have dropped out since 2008.

But overall, it appears that the biggest factor in Texas doctors' financial problems is the growing number of uninsured people. Twenty-six percent of Texans are uninsured -- the highest rate in the country. When combined with the large Medicaid population and the many undocumented immigrants in Texas, physicians are seeing a lot of people who can't pay enough to cover their costs. Combine that with the diminution of Medicare payments and the number of commercially insured patients, and you have a recipe for trouble.

Texas, of course, is not the only state that has some or all of these problems. The ranks of the uninsured, underinsured, and Medicaid patients are swelling across the country, and the number of undocumented immigrants is large in all the states bordering on Mexico. So many physicians in other states are facing some or all of the same problems as their Texan colleagues.

Will healthcare reform help alleviate these problems? The majority of doctors, in Texas and elsewhere, think reform will make things worse. They're right in one respect: the big increase in the Medicaid population that's expected in 2014 won't help doctors financially. But if a lot more people get private insurance with government subsidies, it's hard to see how that will not be good for physicians.

Until then, we can expect to hear a lot more cries of pain from doctors as the economy and government budget slashing take their toll. And many of those physicians will undoubtedly sell out to hospitals and become employed.

Image supplied courtesy of Flickr.
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