An MGMA survey conducted earlier this year on medical liability found that group practices experienced an average premium increase of 53.2% between 2002 and 2003. The survey of 700 group practices employing 16,000 physicians, which was released in February, found that 26.1% of practices indicated that their physicians would retire, relocate or restrict their services over the next three years.
Even though the malpractice crisis has focused on the impact to surgeons, it will trickle down to psychiatrists and primary care providers, said Peg Stone, senior vice president at Cejka Consulting, a health care consulting firm.
"One of the things I would predict," Stone told PT, "is that in order to make it more economical for the surgeons to have malpractice [insurance], the cost is going to have to be borne by other physicians and specialties."
If costs rise due to increased malpractice premiums, it is sure to make a dent on psychiatrists' earnings. "They can only have so many appointments per day," she said.
Medicare will also be an ongoing concern.
The recent furor over Medicare rate cuts resulted from a 1997 law that used inaccurate estimates of gross domestic product and fee-for-service enrollment to formulate spending targets. The resulting estimates would have meant rate cuts every year until 2009.
According to the American Medical Association, the Centers for Medicare & Medicaid Services acknowledged the errors but said that the law did not allow the agency to correct the estimates itself. In February, Congress passed a provision that protects the Bush administration from lawsuits if it corrects errors found in the formula.
Physicians will still face a rate cut in 2004, but it will be smaller than initially projected. (As this issue went to press, the preliminary estimate of the 2004 rate cut was pegged at 4.2%. The final update is expected to be announced in November--Ed.)
Trade associations had said that without intervention by Congress, the original schedule of reimbursement cuts would result in a disaster for the Medicare program. The California Medical Association found in November that 78% of responding physicians said they would have to limit or drop their Medicare patients if the original Medicare cuts were to remain in place.
Concerns over reimbursement in California had gotten so bad that more than half of physicians polled by the California Medical Association in 2001 said they had problems attracting new doctors to their practices and that half planned to quit, retire or move out of state within three years.
According to the report "And Then There Were None: The Coming Physician Supply Problem," psychiatry was one of eight specialties that showed a net loss of more than two physicians (2.3) per 100,000 people between 1995 and 2000. The report noted particular concerns over the shortage of child psychiatrists.California's Work Force
In February, the California Workforce Initiative released a report called "The Mental Health Workforce: Who's Meeting California's Needs?"
According to the report, California psychiatrists reported an average annual income of about $130,000, a figure it found comparable to other states. About 58% of California psychiatrists practice in private offices, and 53% of patient reimbursement came through private insurance (33%) or self-pay (20%).
About 85% of California psychiatrists in 2000 were generalists without sub-specialty certifications, and about 12% specialized in child and adolescent psychiatry. Three percent specialized in psychoanalysis.
The report found that 75% of California psychiatrists were male; 56% were white; more than half were over age 55; and nearly 88% worked primarily in an office-based setting.
About 21% of the state's psychiatrists practiced in public settings, the report found, and about 36% of payments for psychiatrists came through public insurance programs. Less than 4% of care was uncompensated.
Most of the literature reviewed for the report focused on the pressures of working in community mental health care centers and the effects of managed care on psychiatric practice. The report said that demographic trends will result in psychiatrists working fewer hours as the profession becomes older and more female.
However, it also noted research that found psychiatrists saw 17% more patients in 1998 than they did 10 years earlier. That increase included a 44% increase in the number of patients over age 65.