Posted by Jack Stephens on 5/21/2008 in Articles from Veterinary Newsletter
THE FEAR FACTOR – PET INSURANCE NEED NOT REPEAT HUMAN HEALTH CARE PRACTICES
We have all heard the medical profession lament the concept of managed care as an intrusion into the way they practice and the way it has taken much of the enjoyment out of practicing medicine. But if one looks back to those early days when decisions were being made, the medical profession basically did not become involved in that decision-making process.
They practiced medicine and left the financing of their services to others. Of course, managed care in the medical field has not been all bad; it has increased access and the level of care to and for more people. Overall, it has been rejected as a concept that has more flaws than benefits. As we look to this model, we have to ask ourselves: What is it that we want and do not want for pets, pet owners, and our profession?
Since 1982, I have railed against managed care principles in pet health insurance. Yet most of my colleagues are still not sure what managed care in veterinary medicine is, other than “setting of fees and taking away decisions.”
In an effort to clarify how to recognize managed care, what to avoid and most of all how the profession can control our destiny, I have devoted this editorial piece to managed care principles, how to avoid them and how pet insurance can benefit pets, pet owners and practices, without managed care ever taking hold. Much more could and will be said on the subject in articles, journals and later newsletters.
As a profession, we can have control of how we practice and avoid the pitfalls that have happened to the medical profession.
PRINCIPLES OF MANAGED CARE – GOOD REASON FOR CAUTION
Historically, managed care involves several key principles that include:
Setting of fees based on procedures, diagnosis and diagnostics
Taking decisions on diagnostics and treatment away from the treating doctor
Limiting choices by both the patient and doctor
Complicating the process with layers of bureaucracy in order to receive payment
Reducing or eliminating the out-of-pocket cost (co-payments and deductibles) to patients, thus eliminating their involvement in the financial decisions for care
Forcing doctors to join networks or accept lower fee schedules in return for higher patient loads
Patients restricted to the level of care provided for in the networks and receive no benefits – or greatly restricted benefits – if care is sought outside the network, except in emergencies
The doctor-patient relationship is virtually eliminated
Doctors in a managed-care environment are not inclined to have a strong doctor-patient relationship. Patients are chosen for them.
Non-managed care physicians and veterinarians, on the other hand, must please their clients. They must communicate, not rush, fully explain options and basically have a good beside or “table side” manner to be successful. If not, clients will go down the street.
In managed care, the patient is forced to visit the network in order to be covered. The patient load is dictated by others, not by experience or quality of care. At the risk of alienating my physician colleagues, the managed care system forces an almost assembly-line mentality to care. Human healthcare hospitals only started becoming more compassionate with better quality of care and services when they had to compete with other hospitals in order to increase profits.
Much more can be stated, but again, no veterinarian with whom I have spoken in over 25 years wanted managed care for our profession that dictates how we deliver care.
SO WHAT DO CLIENTS AND VETERINARIANS WANT?
To choose their own veterinarian
Insurance that is easy-to-understand and provides high reimbursements
Fast claims payments with no hassle
Comprehensive policies that allow for routine care
Choice: The ability for the client and treating doctor to determine the level of care
Little or no paperwork in filing of claims
No schedule of fees or benefits dictating or implying what to charge
No restrictions on diagnostics; allow the treating doctor to determine what is necessary, based on the situation
Ability for clients to freely choose where to take their pet for care, including specialists
No complicated payment method or restrictions on how care is provided
Freedom to set fees to suit the style and overhead of the practice
No third party dictating the quality of care
No third party overruling treatment decisions of the treating doctor by disallowing or limiting benefits
HOW CAN WE PREVENT MANAGED CARE?
-Don’t join networks, PPOs or other schemes that are predicated on bringing you more clients. Controlling the client’s choice of choosing their pet’s veterinarian must be avoided, as this is the number one tenet of managed care! If we only had one thing to avoid, it would be this.
-Don’t provide discounts to groups for increased business. Keep discounts or free care to your individual choice.
-Set your own fees and avoid fee and benefit schedules. If a large portion of your fees are not reimbursed it makes you look like you are overcharging.
-Don’t accept third parties (companies) telling you how to practice, setting procedures, fees or level of care to provide.
-Don’t recommend companies that do not meet your standards, or restrict care due to the age of the pet.
OUR BRAND & PROMISE
Pets Best Insurance was launched in October 2005, to simplify how pet insurance reimburses pet owners. It was apparent that a straightforward 80% reimbursement of what the veterinarian charged for services was necessary. Veterinary medicine had changed, and changing how pet insurance operates had to happen! The level of care had risen dramatically for pets due to the rapid progression of the human-animal bond, access to specialists, and multiple-doctor practices.
When I first established the category of pet health insurance in 1980, I had three goals. The first was to provide a method for pet owners to have peace of mind; second, the ability to budget for unexpected pet health care cost; and third, to be certain that the managed care principles that so plague human medicine do not take root in our profession.
When I founded Pets Best, some twenty-five years later, I wanted to improve the industry I created and to leave a better legacy of pet insurance as being relevant and advantageous for pets, pet owners and veterinarians.
WHAT MORE CAN YOU DO?
When advising your clients of pet insurance options, make sure to recommend a company that is a member of the newly formed North American Pet Health Insurance Association. (Visit www.naphia.org for more information.) Membership standards disallow the most prominent managed-care principles. Standards are set and enforced for high levels of service, turn-around time on reimbursements, dispute resolution and independent third-party rating of member performance after a claim. For pet insurance to prosper, pet owners must know with clarity and certainty how much pet insurance will cover of the actual veterinary cost.
PET INSURANCE IS HERE TO STAY
Pet Health insurance is now nearing $300 million in annual revenues and forecasted to reach over $1.2 billion by 2012. With all the new, very large and well financed companies now entering the field, it will only grow, because there is a financial need for pet owners who want to afford the increasing cost of unexpected pet accidents, illness or trauma. Attempting to simply ignore this rapid growth of pet insurance will not be a viable response by the veterinary profession if it wishes to avoid the many pitfalls of veterinary managed care.
In closing, the veterinary profession must be involved to guide and influence the pet health insurance industry. If we do, I know I will have left a legacy that truly enhances the delivery of veterinary care for pets.
Jack L. Stephens, DVM
Pets Best Insurance