Many spine surgeons have expressed frustration over CMS' proposed 2024 Medicare physician fee schedule and its 3.34 percent pay cut. Declining CMS fees have been an ongoing concern in the industry and the reason why Ara Deukmedjian, MD, decided to back out of Medicare more than a decade ago.
Dr. Deukmedjian, of Deuk Spine Institute in Melbourne, Fla., spoke with Becker's about the decision and his outlook on CMS.
Note: This conversation was lightly edited for clarity.
Question: Can you talk more about your decision to opt out of Medicare?
Dr. Ara Deukmedjian: I decided because I saw my reimbursement from Medicare for my professional fees as a neurosurgeon declining year over year and under threat year over year to where I saw approximately a 50 percent decrease over 10 years from 2000 to 2004 to about 2012 for my same surgeries I was doing. I also saw the Department of Justice going after physicians like a witch hunt for unintentional miscoding of services, which of course is a felony and comes with steep financial fines. I decided the risk of being a Medicare in-network neurosurgeon provider far outweighed the benefits. I signed the opt out form around 2011, and I have been very happy since then. Medicare patients pay me cash. They pay me a negotiated rate that I believe is fair and sustainable; the word "sustainable" is important.
Q: How did this affect patient volumes and access? What are negotiations like?
AD: Initially when I opted out, there was a significant decline in my business because Medicare patients represented 50 percent of my patients and they basically decided they would just go elsewhere for care. However, as my reputation in the community grew as a high quality provider, Medicare patients became more determined that they would have me as their surgeon because they did not want complications with their surgery. So they chose to pay me cash for their services. The cash rate was usually somewhere between 200 percent to 400 percent of the Medicare fee.
Q: Have you faced any challenges with this model?
AD: The challenges would be if you're in an area of the country where there's a lot of neurosurgical competition and you have a lot of providers, then patients may not want to pay cash to the provider who is not part of that Medicare. However I have been much happier. I see fewer Medicare patients, but for the ones I operate on, I feel that I get paid much better and I get compensated fairly. My practice has thrived. I'm doing better now financially than ever before. I don't have a threat of worrying about whether the Department of Justice is going to come after me for accidentally coding a level three when it should be a level two or vice versa.
Q: What advice do you have for spine and neurosurgeons who are in more competitive areas who can't necessarily do what you're doing?
AD: I would say get used to getting fee schedule cuts. There is a lack of appreciation for services that physicians provide to Medicare beneficiaries and that this declining reimbursement is being driven by the private insurance companies who are the Medicare administrative companies and their profits. Their profitability is directly correlated to the amount of money they save for Medicare by reducing physician compensation. The max on the private insurance side gets to tie their private payments to physicians, to Medicare payments. As the Medicare rates go down by 3.34 percent, so do the private payments from Blue Cross Blue Shield, Cigna United and Aetna. So the private insurance companies are using Medicare reimbursement to lower their private payments to physicians because they're tied to Medicare reimbursement in their contracts with physicians. For physicians who are not in a position to drop Medicare, I would recommend they get into a position to change their circumstance so that they can go out of network.
Q: Is there anything else you'd like to discuss that we didn't cover already?
AD: Physicians who are off Medicare can still provide emergency medical care to Medicare patients and get paid the Medicare rate. I'm in a situation where I primarily just treat patients outpatient, so I don't really see patients on call. But physicians can opt out of Medicare, do private contracting with Medicare patients to pay better for their services but still get paid for emergency care that they provide when they're on call at the hospital by Medicare. So it actually is a good thing.