Two consultant surgeons apply for recognition by insurance companies.
They have been told by various insurance companies that the fees for their initial and follow up consultations are lower than they anticipated.
They are not amused to say the least.
But what can they do about it?
Actually, that’s not strictly true. In a perfect world there is much they can do. But we don’t live in a perfect world. We live in this one.
In a perfect world they can, for example, pass any reduction in fees on to their patients.
Save of course their recognition agreement with the insurance company forbids them to do so.
If they do they are at risk of de-recognition. Ah came the reply, the insurance company won’t find out.
Yes, they will.
Or they can stop seeing patients referred to them by that specific insurance company.
Both of these consultants, however, are by no means stupid.
Neither of them just reacts.
An immediate reaction is potentially the worst thing to do.
Many years ago MHM worked with one consultant who did just that when denied a fee by an insurance company.
He even went so far as to tell the insurance company concerned unless they immediately put his consultation fees back up he would forgo his recognition with them and refuse to see their insured patients.
They didn’t so he did.
And immediately saw a 23% drop in the private practice turnover.
Do NOT react.
What is required is a considered response to all the options.
In the case of the MHM clients, I calculated what the drop-in consultation fees would mean over a six month period against an assumption that the lack of referrals would lead to 25%, 50% or a 100% drop in patients from that specific insurance company.
In all cases, for obvious reasons, there was a loss.
But at least that loss was now quantified.
It is worth noting that the drop in consultation fees would not equal a drop in surgical fees because surgical fees were excluded from the reduction.
That said a refusal to see patients from the specific insurance company concerned due to consultation fee reduction would automatically lead to a 100% drop in surgical fees as clearly if a consultant does not see a patient.
Sadly there are only two options in reality: accept the reduction or don’t accept the reduction.
I’m afraid the insurance company really is in the driving seat when it comes to setting their fees and there is little a private consultant surgeon can do about it.
Many years ago a private consultant surgeon could charge what they liked and to a certain extent with a self-funding patient, they still can.
However, with insured patients, those days are long gone.
So what should the private consultant surgeon do?
MHM suggests an analysis of how the reduction will impact on the private practice should be undertaken.
That will at least quantify how the reduction will impact the private consultant surgeon in actual financial terms.
All the data will be contained on a sales ledger and with the aid of an excel spreadsheet it’s relatively easy to perform the analysis.
The bottom line remains to accept the fee reduction or reject the fee reduction.