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Traditional Values. Innovative Care.

Do Clinical Doctorates Make Sense In Light of Lower Reimbursements?

Posted: 3/28/11
Darrell Metcalf

Healthcare cost, Healthcare cost, Healthcare cost… the rhetoric seems almost endless regarding what benefits should be cut, what payments are unnecessary and how much fraud is occurring. I have been pondering the healthcare cost question for some time and have expressed my views to a few colleagues. It seems to me that the government wants to constantly focus on the symptoms of the problem (i.e. we are paying too much) without ever focusing on the root causes of the problem. While the problems are certainly multi-dimensional, I postulate that a base cause is the expectations that are created by our educational system.

Looking at Physical Therapy as a microcosm of healthcare in general, the last decade has brought a progression of the educational requirement to practice from a Bachelors degree, to Masters to a Doctorate. Basic economics/finance would tell you that you should only be willing to invest in a venture that yields a positive net present value (essentially, the cost paid upfront will be more than offset by the earnings that will be achieved subsequently). The expectations for compensation that are being created through the upfront educational costs are disassociated with the direction of reimbursement allowed by the 800-pound gorilla – Medicare. It’s probably not too popular to discuss this topic on a site that has one of its focuses as recruiting graduates however, it is a conundrum that students, employers and frankly the APTA, which has driven this educational progression, need to resolve.

Over the last decade the APTA has advocated for increased education to put Physical Therapy on par with M.D.s in the hope of expanding self-referral and minimizing therapy’s tie as a referred service overseen by another medical professional. While the organization has been successful in driving towards the DPT standard and has put some wins in the self-referral column, it has been decidedly less successful in affecting an even more important component – reimbursement. One could say they are fighting an uphill battle given that Medicare is trying to reduce costs but if that is the case, why do you raise compensation expectations at the same time that reimbursement is declining?

In the last six months, therapy has been hit by MDS 3.0 (which slid the cost structure higher by significantly reducing concurrent therapy and student involvement), RUG IV (which “re-balanced” the per diem nursing/therapy weighting of the overall reimbursement back to nursing) and MPPR (Multiple Procedure Payment Reduction, which reduces reimbursement for multi-unit/multi-discipline therapy treatments). Downward pressure on reimbursement, upward pressure on costs due to the debt service and/or investment return expectations of students and practitioners – an interesting cocktail to contemplate. I welcome your thoughts and comments on these competing directions.

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  1. Sumer

    For discussion sake and my own future ventures……
    If we don't make the move to a clinical docotrate in order to create direct access, will we be able to sustain our profession on medical referrals? It seems that the reimbursement cuts will happen, whether we like it or not. Of course, we hope that our profession has avanced it's evidence-base practice forum enough, that we won't be first on the chopping block. However, if massive cuts do take place, an direct access does become an option, couldn't we market to the private sector and move forward with increased patient pool, even if we have to accept the reimbursement decreases?

    • SAMatRV

      I think that works for a portion of practicing professionals (most notably those in private clinics) however, clinicians working in Hospitals and Skilled Nursing Facilities don’t necessarily have the same flexibility to create “demand.” For those entities whose mission doesn’t allow them to be selective regarding their caseload, the economics becomes much less certain. Specifically, many institutional providers have over 50% of their volumes from Medicare/Medicaid. I agree with your premise that the profession needed to move forward. My concern is that the profession/association didn’t evaluate the prospects for improved reimbursement before increasing the cost curve. I’m not sure the Field of Dreams approach of “if you build it they will come” applies to Congress.

    • Sumer

      I am not ceratin the choice to evaluate improved reimbursement options existed then or that it even exist currently. It seems that congress will do what congress does. Perhaps, rather than a "if you build they will come" I would lean more towards "if you document they will reimburse". Truly, it comes back to the same principle, evidence-based practice. If we as professionals provide skilled services that progress and benefit our patients, and we document that we provide skilled services that progress and benefit our patients. The reimbursement issue will work out as it should. If we don't show that our skills are a valuable asset, they will not be treated as such. 🙂 I found this link and thought it was informative.

  2. veteran therapist

    The PT, OT, and ST professions have grown intensely over the past several decades relying on on medical referrals. There is no reason to suspect they won't continue to thrive on this model. Many states (including Nebraska)already allow direct access to PT without a physician referral for private pay or private insurance, a clinical doctorate is not necessary for this. Medicare and other principle 3rd party payors will continue to require a physician referral.

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