Nevada Healthcare is reaching its breaking point. As our taxes continue to stay low and our economy continues to surge, we’re as thankful as ever for the influx of new people. Last year over 22,000 people moved from California alone! These people need homes, jobs, they buy local products and see local doctors. Our economy can’t survive without them.
OUR DOCTOR PROBLEM
As we look at the services we have available for Nevada residents, healthcare should be at the top of the list. Our local health insurance companies, Hometown Health, and Prominence Health Plans have both seen a surge in membership. This includes small businesses, individuals, and Medicare-eligible members. Both health insurance companies are dealing with the same primary issue, lack of doctors.
A study from the University of Nevada revealed some staggering statistics about the supply of doctors here locally:
- Nevada’s rank among U.S. states is currently 45th for active physicians per 100,000 population, 48th for primary care physicians per 100,000 population, and 50th for general surgeons per 100,000 population.
- Currently, 27.3% of active physicians in Nevada possess a medical degree from another country (rank of 8th among U.S. states), 29.6% are aged 60 or older (38th), and 29.1% are female (44th).
- Nevada currently ranks 25th among U.S. states for the number of undergraduate medical students per 100,000 population. However, Nevada ranks 44th for the number of residents and fellows per 100,000 population.
Nevada Healthcare today is on life support. As time progresses and the population expands this situation will continue to grow worse. The lack of doctors is the primary problem.
PROPOSED SOLUTIONS
The proposed solution from both of our local insurance companies is to attract more doctors into Reno. Both actively recruit doctors from outside the area to live and work here. However, the study from the University of Nevada seems to be telling a different story. Nevada currently ranks 25th in the country for the number of undergraduate medical students, however, once they become residents and fellows, they seem to move outside of the state. We’re 44th in the country for the number of residents and fellows. Many of these students may be visiting Nevada to go to school with the full intention of moving back after graduation. However, this is a dramatic exodus that’s taking place after graduation. Our inability to retain these students into their careers and final position is hurting our Nevada healthcare system.
WHAT ABOUT NEW STUDENTS
Overall I believe there’s a bigger problem. Nevada Healthcare professionals don’t’ earn anywhere near the level of other professionals with the same education. It’s sad to see that on average those with a doctoral degree are actually paid LESS than those with a professional degree. On average doctors graduate medical school with 200,000 in medical debt. The interest alone on medical school debt is equivalent to a second mortgage payment! In order to train good, qualified doctors, payments need to increase.
Students are not stupid, especially those thinking of becoming doctors. If a student can make more money with less schooling and work, most are going to. Many professions including software engineers, financial advisors, mortgage brokers, and pharmacists, all require less schooling, and with experience, many earn significantly more than doctors. It’s difficult to convince a student to give up their money, sleep, and years of their life to make less than they would with these other careers. Financially it doesn’t make sense. These students need to truly love medicine and nothing else.
DOCTORS REIMBURSEMENTS
The majority of people I talk to don’t care how much their doctor earns. This isn’t a consideration for them now or in the future. This way of thinking is also very evident in the reimbursement doctors receive. Today private insurance reimburses more than double what Medicare would pay. The state, in combination with the federal government, controls Medicaid reimbursement levels. Medicaid reimbursements rates will vary based on the service but it’s generally agreed that Medicaid has the lowest reimbursement level out of the three.
These reimbursement levels vary so much because private insurance companies are still competing to have a good list of doctors contracted with them. They are going for the top bid, within their budgets. They’re trying to get as many good, qualified doctors as possible to be on their list, or “network”. Medicaid, on the other hand, is a state-run agency. It’s a social safety net to prevent low-income people from being unable to see a doctor. Reimbursement rates for Medicaid are extremely low.
REIMBURSEMENT = ACCEPTANCE
There is a direct correlation between the reimbursement rate and the number of doctors who are accepting that type of insurance. The information I’ve gathered from asking clients over the past 10 years mirrors this. Ranked from most accepted by physicians at the top to least accepted at the bottom –
- *Large group plans (employers with 100+ employees)
- *Small group plans (employers with -100 employees)
- *Individual health plans
- Medicare
- Health Insurance Exchange Plans (healthcare.gov, state marketplaces, etc)
- Medicaid
*private insurance
So with this huge disparity in reimbursement rates, many people (including the federal government) are looking to even the playing field.
BRING UP THE BOTTOM
One option would involve moving the reimbursement rates for Medicare and Medicaid up. This would significantly increase taxes. Our federal healthcare programs already account for nearly 25% of the federal budget or 1.1 trillion dollars per year. As a state, we’re averse to tax increases. An increase is impalpable to the majority of people.
BRING DOWN THE TOP
Another option is to cut off the top, meaning reimburse doctors less overall. This has a few implications.
STAYING OPEN
First, many doctors are able to survive in their practices. Today they have the ability to subsidize the lower reimbursing entities (Medicaid) with higher reimbursing entities (Private Insurance). They would lose this balance if every client was on Medicaid.
STAYING AVAILABLE
Second, many doctors’ offices who currently accept a majority of Medicare patients don’t get to spend the time with each patient that they would like to. These doctors need to see a lot of patients in order to receive enough reimbursement from Medicare in order to keep their office open. Moving every doctor to this same reimbursement level would multiply this problem.
STAYING AFFORDABLE
Third, current doctors would stop accepting insurance. This is already a growing trend for Nevada healthcare professionals. Many doctors are instead are going “concierge” and rejecting all insurance and state-provided healthcare. Instead, they’re forming direct contracts with patients and cutting out anyone who can’t afford it.
STAYING ATTRACTIVE
Fourth, it would be very difficult to attract talented students to become doctors. A 2016 survey of American Physicians found, among other things:
- 80% of physicians are overextended or are at capacity, with no time to see additional patients
- 48% of physicians said their time with patients is always or often limited
- 46.8% of physicians plan to accelerate their retirement plans
- 27% of physicians do not see Medicare patients, or limit the number they see
- 36% of physicians do not see Medicaid patients, or limit the number they see
Overall the solution isn’t easy. We have a unique situation here in Northern Nevada with our growing economy and a shrinking list of doctors. Our solution can’t be to exacerbate the problem. We need to understand how we got here and what the root causes are. We need to come up with a plan that doesn’t leave physicians being paid unsustainable wages. The future of our healthcare system nationwide can turn around, and I think here in Nevada is a great place to start.
