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Payer mega-mergers — Are there any pros for spine surgeons? Featured

Written by  Anuja Vaidya | Thursday, 02 February 2017 22:02
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Four spine surgeons weigh in on the pros and cons of mega-mergers within the payer industry.

Ask Spine Surgeons is a weekly series of questions posed to spine surgeons around the country about clinical, business and policy issues affecting spine care. We invite all spine surgeon and specialist responses.



Next week's question: Which regulation governing the healthcare industry would you like to see overturned?



Please send responses to Anuja Vaidya at avaidya@beckershealthcare.com by Wednesday, Feb. 15, at 5 p.m. CST.



Question: What are some pros and cons to insurance company mega-mergers?



J. Brian Gill, MD, MBA. Nebraska Spine Hospital (Omaha): These insurance mega-mergers are being looked at with great scrutiny amongst U.S. regulators. The advantages of these mergers could possibly reduce administrative waste that comes when companies offer similar products. Mergers can reduce redundant processes and departments. With fewer insurance companies, negotiating is simplified as now there might only be a few companies to discuss contracts with instead of multiple companies.



However, these mergers can reduce competition allowing insurance companies to dictate reimbursement rates. If there are only a couple of insurance companies in a particular community, then physicians may have little choice but to accept the offered rates and terms or risk losing patients and ultimately their respective practices. Finally, these mergers might allow rationing of care to certain individuals or procedures which are considered to be high cost.



Brian R. Gantwerker, MD. Founder of the Craniospinal Center of Los Angeles: I see only cons here. It is the very antithesis of what the Obama administration was trying to achieve — a competitive marketplace.  Predictably, as the companies saw their profits dip, they are either trying to grab more market share or leave the exchanges completely.



Another very prescient movement is the trend towards a single payer system, and what I view as the inevitability of a two-tier system like the ones in Europe. With only the richest of patients being able to go "outside" the system I am very concerned about how everyone else will be able to get good surgeons. And, almost as important is how those doctors "inside" the system can keep from getting burned out. My concern is also for the unattractiveness of a career in medicine. I meet fewer and fewer young people who want to embark on a career in medicine.



Vladimir Sinkov, MD. Spine Surgeon at New Hampshire Orthopaedic Center (Nashua): Pros include insurance companies getting to post higher profits, creating more jobs and increasing their stock value. However, cons include the fact that further lack of competition will increase insurance rates and overall healthcare costs, put more administrative burden on physicians and patients and limit patients' access to and ability to get reimbursement for diagnostic studies and treatments.



Richard Kube, MD. Founder and CEO, Prairie Spine & Pain Institute (Peoria, Ill.): These mega-mergers are creating monopolies. There are no free market forces strong enough to counter what is being done by these large carriers. While collusion between the large carriers is not allowed, one can fit the CEOs of the companies insuring 50 percent to 75 percent of the PPO population around a large dinner table. Physicians are too segmented to be able to compete with numbers. The cons are the same as those faced with monopolies in any industry. I have yet to come up with a pro.

 

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Payer mega-mergers — Are there any pros for spine surgeons?

 

Four spine surgeons weigh in on the pros and cons of mega-mergers within the payer industry.

 

Ask Spine Surgeons is a weekly series of questions posed to spine surgeons around the country about clinical, business and policy issues affecting spine care. We invite all spine surgeon and specialist responses.

Next week's question: Which regulation governing the healthcare industry would you like to see overturned?

 

Please send responses to Anuja Vaidya at avaidya@beckershealthcare.com by Wednesday, Feb. 15, at 5 p.m. CST.

 

Question: What are some pros and cons to insurance company mega-mergers?

 

J. Brian Gill, MD, MBA. Nebraska Spine Hospital (Omaha): These insurance mega-mergers are being looked at with great scrutiny amongst U.S. regulators. The advantages of these mergers could possibly reduce administrative waste that comes when companies offer similar products. Mergers can reduce redundant processes and departments. With fewer insurance companies, negotiating is simplified as now there might only be a few companies to discuss contracts with instead of multiple companies.

 

However, these mergers can reduce competition allowing insurance companies to dictate reimbursement rates. If there are only a couple of insurance companies in a particular community, then physicians may have little choice but to accept the offered rates and terms or risk losing patients and ultimately their respective practices. Finally, these mergers might allow rationing of care to certain individuals or procedures which are considered to be high cost.

 

Brian R. Gantwerker, MD. Founder of the Craniospinal Center of Los Angeles: I see only cons here. It is the very antithesis of what the Obama administration was trying to achieve — a competitive marketplace.  Predictably, as the companies saw their profits dip, they are either trying to grab more market share or leave the exchanges completely.

 

Another very prescient movement is the trend towards a single payer system, and what I view as the inevitability of a two-tier system like the ones in Europe. With only the richest of patients being able to go "outside" the system I am very concerned about how everyone else will be able to get good surgeons. And, almost as important is how those doctors "inside" the system can keep from getting burned out. My concern is also for the unattractiveness of a career in medicine. I meet fewer and fewer young people who want to embark on a career in medicine.

 

Vladimir Sinkov, MD. Spine Surgeon at New Hampshire Orthopaedic Center (Nashua): Pros include insurance companies getting to post higher profits, creating more jobs and increasing their stock value. However, cons include the fact that further lack of competition will increase insurance rates and overall healthcare costs, put more administrative burden on physicians and patients and limit patients' access to and ability to get reimbursement for diagnostic studies and treatments.

 

Richard Kube, MD. Founder and CEO, Prairie Spine & Pain Institute (Peoria, Ill.): These mega-mergers are creating monopolies. There are no free market forces strong enough to counter what is being done by these large carriers. While collusion between the large carriers is not allowed, one can fit the CEOs of the companies insuring 50 percent to 75 percent of the PPO population around a large dinner table. Physicians are too segmented to be able to compete with numbers. The cons are the same as those faced with monopolies in any industry. I have yet to come up with a pro.

 

 

 

Last modified on Thursday, 02 February 2017 22:06
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