Internist says 'no' to all managed care contracts

Income falls but he practices his way

Steven F. Frier, MD, an internist for 29 years, reached a crossroads in his medical practice in Englewood, NJ, in 1992. The road he chose to take is truly the one less followed.

As president of the medical staff at Englewood (NJ) Hospital and Medical Center, Frier helped the hospital form an independent practice association (IPA) to give physicians and the hospital leverage in negotiating managed care contracts.

But soon after Frier helped launch the membership drive, he told his colleagues that he would not join the IPA. "It was a painful decision for me, and in 1992 I wasn't sure that I was doing the right thing for myself or for the community," Frier says.

"Over the years, the decision has been vindicated," he says. "It would have been easy to accumulate lots of contracts, but I took a moral stand and I'm happy with myself no matter what happens to my practice."

Still, the decision has cost him about 30% of his business because New Jersey has a high number of managed care payers. Frier estimates the Englewood area's managed care penetration is about 80%.

Some patients who wanted him to be their physician had to go elsewhere because their companies did not offer indemnity insurance plans. Even if they paid for his services out of pocket, their insurers would not pay for any tests or hospitalizations he would order.

In other cases, patients with more flexible managed care plans have continued to see him. These patients have plans that require them to pay a higher deductible for out-of-network physicians, such as 20% of the fees.

Frier says his own frustrations with a declining patient pool are insignificant compared with the frustrations of some of his colleagues who contract with managed care companies.

"Not a day goes by that I don't hear some story," Frier says.

Soon after he made his decision to eschew all managed care contracts, he had lunch with a physician who was angry over a conflict with a managed care company.

"I said, 'What is going on?' and he said, 'I just spoke with the [MCO's] case manager and they want me to discharge my patient because I'd stopped the IV for antibiotics,'" Frier relates. Frier's colleague said the patient was still sick and he needed to watch her, but the managed care company argued that because he had stopped the IV medication they would no longer pay for the patient's hospitalization.

'Next time I won't stop the IV'

"So I asked him, 'Well, what are you going to do in the future to prevent this from happening?'" Frier says. "And he said, 'That's easy. Next time I won't stop the IV,' and that was the first time I'd ever heard a doctor change his care for economic reasons."

Frier attributes his success at keeping afloat in a solo practice without managed care contracts to his personal touch with patients. He offers these explanations for how and why he continues his practice this way:

· He can spend more time with patients. "As an internist, the most important things I can offer patients are my time and my technical ability," Frier says. "The time you spend with a patient allows the patient to get to know you and allows the physician to get to know and understand the patient."

Patients need a tremendous amount of trust to accept treatment and be healed by it, Frier says. So Frier spends a great deal more time with his patients than he would if he were forced to increase his volume because of managed care contracts. For instance, he will see about 10 patients between 8:30 a.m. and noon, as compared with the 25-30 patients some physicians will see during an average morning.

Frier might spend an hour and 10 minutes with a patient who has an appointment for a thorough examination.

"Any doctor can learn the technological aspects of practice," Frier says. "But the human side of it is what takes the time."

· He goes over the patient's history in person. "I have a man in the waiting room right now whom I have not seen in about five years," Frier says.

The man was there for a physical. "I'm going to sit down with him for 25 minutes and talk and take a full history," Frier says. "He and I are going to interact, and I'm not going to sit there and have him fill out a questionnaire; I'll ask him questions and we'll chat."

Then Frier examines the patient and sits down to talk with him again for 15 to 20 minutes, going over his history and examination.

"During that period, I'll advise him and he'll get to know me a bit," Frier says. "By the time he leaves the office, he'll believe he has a doctor who genuinely cares about him."

· He explains his personal managed care policy to patients. Frier often tells patients why he will not accept managed care contracts, and he recently wrote a letter about his decision. It reads:

"To my patients:

Many of you know I do not participate with managed care insurance companies (HMOs). This decision, made more than five years ago, has turned out to be very important for my patients and practice.

Managed care is a volume business. The HMO makes the doctor's name available to thousands of its patients. The trade-off is the doctor may not have enough time for each patient and is likely to be constrained by limits on consultation, testing, treatment, and possibly by financial capitation arrangements. If I were to practice this way, it would offend my training and professional ethics.

Because of my independence from HMOs, you and I maintain a traditional patient-doctor relationship. This means you can continue to look to me as your advocate, not as your insurance company's gatekeeper. You can be certain that I am not motivated by monetary incentives to limit care and that no decision I make is even remotely influenced by the financial interests of an insurance company.

Accordingly, you can receive consultations with any specialists and benefit from sophisticated tests without delay or obstruction. You and I, not an HMO, decide where and how you are treated.

As a result of my decision, I continue to enjoy the study and practice of medicine and the time I spend with you. My greatest reward for practicing medicine has been the privilege of being your physician.

Please call me if you would like to discuss these matters with me. I would be delighted to chat with you. . . ."

· He knows his own priorities as a physician. Frier says he has some financial freedom now that his children are grown and on their own. But even if he had more financial demands, he would have made this decision to trade some income for the type of practice he wants to have.

"My lifestyle has changed somewhat, as well it had to, but I'm perfectly happy with that because when I look back at my professional life, I'll say I did it my way," Frier says. "Some of my colleagues in the community can't say that. They don't enjoy the practice of medicine anymore, and they wonder if they're doing what they're supposed to be doing."