Experts' View

Impact of the Affordable Care Act on Physician Practices and the Quality of Care (Part I)

MedPanel hosts a community of over 400,000 physicians, nurses, and hospital executives, so we hear quite a bit about the changing landscape of healthcare from our members. One of the major drivers of change has been the Affordable Care Act (ACA). The ACA (aka “Obamacare”) was passed into law in 2010 and promised to expand access to healthcare for millions of uninsured and underinsured patients, while simultaneously restraining the growth in healthcare costs for the United States.

On its 5 year anniversary, most elements of the ACA have now been enacted. By most measures, the ACA has achieved its goal of expanding access to healthcare (various surveys suggest 8-10 million Americans gained coverage through the ACA) while also slowing healthcare costs. (It is worth noting that the slowdown was triggered initially by the economic collapse in 2008). Likewise, some of the more dire warnings of opponents have not come to pass, particularly regarding the strain that the ACA would place on the economy. As President Obama recently noted, “It’s not the job killer that critics have warned of for five years.” There is still one important area that has not been addressed enough, however, which is: How has the ACA changed the practice of medicine from the physician’s point of view?

The ACA sought to make health insurance affordable for the many young, low-income, uninsured, and underinsured Americans. The new coverage made available through the ACA’s healthcare exchanges often came in the form of high deductible, high co-pay plans that had low premiums to appeal to these new customers. At the same time, the ACA reduced CMS reimbursement for certain procedures to contain costs. How much did the demographics of each physician’s patient pool change after the ACA, and how did the new insurance coverages these patients brought with them affect medical practice?

From February 27 – March 6, 2015, we conducted a survey of over 400 physicians across all specialties to understand how the ACA has impacted them. No honoraria was paid to the participants. Part I of those results is discussed below.
 
Physicians in small and solo practices have lost patients since the ACA passed.

One anticipated outcome of the enrollment of more Americans in healthcare insurance is that more patients would seek medical care. On average, surveyed physicians indicate that the patient /procedure volumes have indeed increased since the passage of the ACA, but interestingly, those gains are not evenly distributed among practice types.

More physicians practicing in hospitals or large health networks have seen increases than decreases in volume (35% report increases versus 13% reporting decreases), and they say the average magnitude of change is 14-15%. Taken together, the net effect of the ACA appears to be an increase in patients and procedures in these practice settings.
However, the converse is true for physicians in solo practices. Only 17% report an increase in patients, and that increase is only of 12% on average. Strikingly, 32% of solo practitioners report a decrease in volume, and even worse, respondents say the decrease in volume averages 26% fewer patients or procedures compared with before ACA.

These trends suggest that since the ACA has passed, solo practitioners (and to a lesser extent, small group practices) are seeing a decline in patient and procedure volumes, likely putting extreme pressure on their financial health. This trend is likely a key driver for the consolidation of small practices into larger networks as they seek economies of scale.

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Patient demographics have changed for 60-70% of physicians, with hospitals and large practices benefiting more than small and solo practices.

According to survey results from our community of physicians, many of their patient pools are changing in reflection of the ACA’s primary goal of extending coverage to low income, young, and other uninsured and under-insured Americans. Not every practice has seen an impact, though, as 30-40% of respondents report no change.

25% of physicians in hospitals, large health networks, and large independent practices report seeing more patients with medical insurance (lower red box in figure below). 30-50% of respondents also report a shift in the type of insurance patients are bringing with them, specifically citing increasing prevalence of plans with very high deductibles and co-pays. Interestingly, hospitals and large health networks report substantially fewer of these patients than other types of practices (upper red box in figure below).

Roughly 10% of surveyed physicians report seeing more low income, young, and healthy patients seeking preventative care. Almost 20% report seeing more patients seeking treatment for conditions that were previously uncovered as pre-existing conditions. As might be expected given the reported loss of patient volume above, however, these new patients were reported much less frequently by solo practitioners. 

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Physicians have mixed reactions on whether the ACA has achieved its goal of expanding access to quality medical care, though solo practitioners are far more likely to say access has not improved.

44% of physicians in hospitals or larger health networks agree that the ACA has expanded access to quality medical care versus 27% who disagree. This sentiment shifts dramatically as the size of the physician’s practice decreases, however. Compared with only 16% of hospital or large health network physicians who completely disagree that the ACA has expanded access, 34% of small practice physicians and 46% of solo practitioners completely disagree with the premise. 

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Reaction is more negative overall on whether the ACA has improved the care patients receive, but small practice physicians and solo practitioners are still more downbeat than physicians in larger practices

The majority of physicians disagree that the ACA has improved the care their patients receive. While care improvement was not a goal of the ACA, it was certainly not an area that its framers intended to sacrifice. Larger patient volumes may certainly be a factor that leads physicians to feel like they have less time to spend with each patient. Likewise, the changes to reimbursement rates and the increase in high deductible/co-pay insurance plans may also be preventing physicians from getting approval from patients or practice managers to perform the diagnostic and therapeutic procedures they feel are appropriate. As seen in the earlier results, physicians in small or solo practices are more negative about the impact of the ACA, and are more likely to disagree that the ACA has improved the care that patients receive.

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Conclusion
While the ACA is achieving its goal of increasing access to health insurance for millions of underinsured and uninsured Americans, physicians are less enthusiastic about its ability to provide access to quality care or to improve that care.  

What is clear, however, is that physicians working in hospitals and large practices are preferentially benefitting from the influx of new patients, and are much more likely to view the impact of the ACA favorably. Conversely, physicians in small or solo practices have seen substantial drops in patient and procedure volumes since the ACA went into effect, and tend to be very negative about the impact the ACA has had on the access and quality of care that patients now receive.

In the upcoming Part II of our analysis on how the ACA has driven change for physicians, we will explore how the Act has affected the physician personally and financially, and what steps they are taking to adapt. Stay tuned! 

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About this study:

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