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Managed Care and the Future of Dermatology - Where Are We Going?

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(8) Managed Care and the Future of Dermatology - Where Are We Going?


Irwin M. Freedberg M.D., Walter Wood M.D., and Arthur Huntley M.D.

Dermatology Online Journal, December 1995
Volume 1, Number 2

We live in an era of ever increasing pressure on the specialty of dermatology with declining numbers of referrals and declining reimbursement. Managed care may be bringing the cost of medicine down, but possibly at the expense of dismantling the system of specialty care. The possibility of a decreased need for dermatologists have led some to question the need for continuing to train as many residents and for giving primary care physicians more dermatology training.

Over the years, as an academic dermatologist, I have become increasingly aware of the comments of some of my private practice colleagues about the inappropriateness of training non-dermatologists, those who would then use that information to "compete" with us. I had never been able to resolve this issue to my satisfaction, what role should an academic department have in teaching the specialty to non-dermatologists. When the discussion of the e-mail list group RxDERM-L turned to this topic, I was intrigued and I asked two of the discussants, Walter Wood MD a private practitioner in California, and Irwin Freedberg MD chair of the dermatology Department at NYU to make a few further comments on the subject. Here then are the original letters, followed by my own questions and comments and those of Drs Freedberg and Wood.

from RxDerm-L Discussions

...Managed Care! We are beginning to see MCO's track individual physician prescribing patterns, with the implicit, and I suspect eventually explicit, threat of excluding "expensive prescribers" from the network. Minocin and Accutane are the two drugs which will eventually get me thrown out, I suspect!

Mark Ling, M.D., Ph.D.
Emory University Department of Dermatology

* * * * * That is an example of why I think ethical dermatologists must take a stand against "Managed Care" and capitated payment, and not be intimidated into cheap lower quality medicine. The split is already evident at academic medical centers, where some dermatology professors are seriously considering attempts to teach non-dermatologists to do more dermatology because non-dermatologists are cheaper, just as certain generic drugs are cheaper.

In a capitated world, the incentive will be to have gatekeepers, physician assistants, and nurse practitioners do more. Capitated dermatologists will not want "direct access" to them, and non-dermatologist care will be permitted or even encouraged. Capitated dermatologists will welcome the help to keep the work load down to a reasonable level. As non-physicians develop more skill and confidence, they will start to demand authority to prescribe. Psychiatrists are already having this problem with psychologists in California, and ophthalmologists are having this problem with optometrists. Licensed estheticians are setting up "Acne treatment centers" and they too will want to be able to prescribe more effective treatment than non-prescription glycolic acid. They can take a few pharmacology courses and voila, cheap acne treatment, just follow the "guidelines"--so what if a few people with sebaceous hyperplasia or basal cell nevus syndrome get "acne surgery" and "natural" glycolic acid peels for a few years before they get to a real dermatologist.

Walter H. Wood, M.D.

* * * * * ... I must tell you that we just can not divide our specialty by finger pointing at the academicians - yes, I do have interest as a Professor of Dermatology at NYU - However, the question of who gets taught and what we teach must be discussed - as it is being discussed - by an Academy committee and we must develop a plan and move forward to protect our patients - it will take work but we must discuss the issue all together.

Irwin M. Freedberg, M.D.

* * * * *

managed care, academia, and private practice

With these comments in mind, I thought some of the issues would bear exploring. I wrote to Drs. Freedberg and Wood asking them to be involved in a dialog on the subject of managed care, academia, and private practice. Here follows the resulting conversation:
Huntley: It looks like the "academic mission" of our department increasingly involves giving dermatology training to primary care physician residents. Is this in conflict with the specialty?

Dr. Wood: I assume you mean training non-dermatologist primary care residents, since most dermatologists in private practice are primary care physicians who are accessed directly. It is managed care that seeks to define the dermatologist as non-primary care by requiring referrals to get to the dermatologist.

Non-dermatologist primary care physicians and even medical students have always been given dermatology training, so this training is not in conflict, unless the training goes too far. I am sure that in medical school there have always been debates about how much of any given field should be taught to non-specialists and how much time should be given to this or that subject. As a medical student I received dermatology training, and as a primary care medical officer in the Navy I received dermatology training. As I learned more, I treated more conditions myself rather than referring. I think non-dermatologist primary care physicians should learn the basics of recognizing common skin disorders, especially malignant melanoma. I think it is fine for non-dermatologists to treat whatever they are competent to treat.

I do not think they should be taught to perform biopsies or treat skin cancers when there are plenty of dermatologists around who are more competent because of their experience and training. In the case of dermatology, managed care is clearly attempting to make non-specialists do work that should be done by specialists. Managed care is apparently putting pressure on our dermatology professors to train non-dermatologists to do more. Those of us primary care dermatologists in the trenches are depending on the academics to tell managed care - NO!

Huntley: It isn't managed care that is pressuring the departments, at least not directly. It is the medical school. The mission of the school is changing to produce more primary care physicians. The primary care specialty boards are increasing the training requirements to include more dermatology for their candidates. Teaching responsibilities come from the school. Academic freedom gives us the ability to teach controversial material, but not to discriminate in the selection of students.

Dr. Freedberg: You are correct that the Internal Medicine Boards require rotations in dermatology or neurology and perhaps another specialty but here we just don't find that a real problem - the residents that spend time with us only learn to call us after they graduate - so far.

The family medicine issue was discussed at the Association of Professors of Dermatology meeting - in most cases the family practice trainees really teach themselves which is a terrible problem - they designate a family physician generalist as a dermatology specialist and he/she is responsible for the training - I wonder what their conflicts are - would be fun to discuss this all with one of them.

Dr. Wood: Managed care advocates will point to their low costs per patient and claim superiority, when in fact they have profited either by "cherry picking" the most healthy patients, or providing fewer services. These things are all quite obvious to us, but not to patients. When these things become clear to patients, I predict the "managed care train" will derail.

Managed care capitated payment schemes also create incentives to get the cheapest possible person to care for the patient. That is perceived as dangerous to primary care dermatology: Someone else doing our job. I don't think there is any real danger to primary care dermatology as long as we can do it better than they can. What worries us primary care dermatologists is that some dermatology professors are willing to teach non-dermatologists to do more than recognize and refer. This is equivalent to increasing the supply of people capable of delivering dermatologic care, which will take business from us. The analogy within our own specialty is the controversy over who should do Mohs surgery, just those who are fellowship trained and certified, or any old dermatologist who is interested enough to learn. If every dermatologist learns to do Mohs surgery, that will not be good economic news for fellowship trained certified Mohs surgeons.

Dr. Freedberg: I am sure that in the long-term training non-dermatologists is not in conflict with our specialty nor in conflict with our role as "doctors" - (from the Latin - docere - to teach) - but in the short term we have to deal directly and quickly with the anxiety that so many of us are feeling about the future.

As I wrote the other day, I believe that there will be some erosion of the patient population we have been seeing because of managed care but there are two factors which will modify this - the first relates to the point that Walter Wood made --- we really know what we are doing and the primary care physicians just can not do it as well -- any more than we could be as good as they are doing their job.

The second factor is the widening dimension of the specialty which I think we should promote as much as we can and not feel guilty about that -- we can deal with cosmetic dermatology and not lose our ability to take care of very sick patients with lupus erythematosus -- a reasonable analogy is the plastic surgeon who can do a superb face lift and not lose the ability to re-implant an amputated extremity.

Dr. Wood: I would also like to comment on "referral guidelines" for primary care physicians. Guidelines are insulting to physicians. As physicians, we are generally aware of our limitations, but these limitations vary considerably.

In view of vastly differing knowledge and interest on the part of individual primary care physicians, there should not be detailed "guidelines" regarding referral, other than common sense hints like "refer when your patient is not happy" or "refer when you are not sure about what you are doing" which applies to specialists as well. Guidelines of care for specific diseases are useful only to point out what is broadly accepted as conventional treatment when arguing with insurance companies about medical necessity. Unfortunately, guidelines have much more ominous potential, in that managed care may attempt to dictate what treatment will be used first, etc., based on cost.

Dr. Freedberg: The guidelines issue is another topic which deserves a complete discussion. There were a set of referral guidelines being used by major insurance companies though Milliman & Robertson which really severely restricted the referral path from generalist to specialist in our field. The Academy decided that the best way to deal with the issue was to issue its own set of referral guidelines which painted the picture much more realistically from the dermatologist's perspective. It is true that guidelines have the potential for being a two edged sword but the other situation was very scary.

Getting back to teaching primary care physicians -- we have not done it at NYU recently but other departments in New York have and they are convinced it actually increases referrals -- would be fun to think about how to do an experiment to actually prove what happens -- maybe it has been done.

In the East, there is no managed care entity putting pressure on the academic portion of our specialty to train non-dermatologists to do more - At NYU we do not have a Family Medicine training program so there are no pressures in that direction and the people in the primary care internal medicine program seem to have too much else to deal with to worry about dermatology very much - that may change as the managed care express hits NY but there is really no way that pressure can be put on people like me to teach more than we think is appropriate. .

As I have said there is a real question - as you point out as well - just how much we should teach to best serve our patients, but the stimulus comes from inside, not outside. Many of my colleagues feel that teaching some dermatology to primary care physicians results in increased referrals in the short-run at least. .

What we all have to do is enlist our patients in the debate for it is they that are really at greatest risk.

Dr. Wood: I cannot agree more. Most of my patients are absolutely livid that they are being forced by their employers choose from plans that restrict their access. Many employers are not offering a traditional indemnity plan option because these have become prohibitively expensive. In California, Medicare HMO plans are recruiting patients with full page advertisements promising improved benefits at little or no cost to the patient. After signing up, most of the patients are shocked to find out that they no longer have regular Medicare, that they can no longer just call up and make an appointment, that they have to have a referral every time they want to see a dermatologist, and that when they do get a referral authorization, it is often for two visits, and that the specialist to whom they were referred is relatively "overbooked" and generally cannot give them the service they expect. What seems even more serious is the perception of most HMO patients that their HMO is doing a good job. Most of these people are relatively healthy people who have not needed much more than primary care. The people who have more serious medical problems, who see numerous specialists, generally opt to keep traditional Medicare. In my opinion, this will further magnify the relatively higher utilization costs attributed to traditional fee for service medicine, and will make traditional fee for service Medicare costs appear to skyrocket.

Dr. Freedberg: My point about teaching and referrals is as follows: Currently, many of my colleagues (since we have not done it recently, I do not have my own data) believe that teaching dermatology to non-dermatologists increases referrals. What I meant by the short-run relates to my concern that things are changing rapidly enough to change the situation in the future. Since consultations will decrease according to all who seriously look at the situation, we are really not going to be able to define the cause of the down-slope to the consultation curve - How much of it is due to managed care per se and how much to the fact that there are courses in which non-dermatologists are taught dermatology.

When you think about the question that is being asked it really becomes irrelevant - books are published, the Internet is here to stay and censorship is not the wave of the future - if someone wants to learn something, they will learn it and the only conclusion that I can draw is that we, the dermatologic community in toto, ought to figure out the best way to do the teaching. I actually do not believe that it is a question to be solved by the academic departments in any vacuum because I suspect the majority of such teaching is done by our colleagues in practice in their local hospitals and medical groups.

Huntley: Rhett Drugge recently commented

* that Canada has one third the number of dermatologists per capita than the United States. Are we training too many dermatologists? Are we creating a problem where the economics of supply and demand will have a major adverse impact on us all?

Dr. Freedberg: Turning to Rhett's comments of the eighth of December which I'm sorry were never answered - Again, I desperately want to stop the finger pointing at the academic world and would appreciate any help from all of you in doing this.

I can not speak for anyone besides myself but I really doubt that my thoughts are much different from those of many others who do what I do. What is Rhett talking about when he speaks of the greed of the academic center looking for low cost labor - the job of the academic center was (and I hope still is and will be in the future) to produce new knowledge and new people to deliver that knowledge to patients - we are not greedy, we are trying to do that job - in the environment I work in our residents ( and there are 25% less of them than there were in the past) do deliver care to people who otherwise would not get the care and as yet the City, State and Nation are not ready to pick up the true cost of taking care of such people - should we abandon them? Are our colleagues in practice ready to turn the clock back and increase volunteerism so that the care can be delivered? Is it the responsibility of those of us on the faculty of Medical Centers to deliver all this care???

The American Board of Dermatology does not deal with residency numbers and is not lobbied by any academic centers - the ABD merely looks at the quality of the product being produced - the Residency Review Commission looks at numbers as part of a review of quality but the FTC is responsible for the oversight of laws regarding restraint of trade which directly impact upon the points that Rhett makes.

I agree with him, and am lucky enough to have been able to act upon my beliefs, that we need to look seriously at the manpower issues - we must make certain that we have a new generation of first-rate dermatologists to keep the knowledge base in our specialty at the level it is at now (never have we known more or had more potential) but we must figure out a way to protect the specialty from self-destruction caused by the finger pointing and anxieties.

There was a great article about the problems of psychiatry in the Wall Street Journal at the end of December - there are many similarities in the response of that specialty to the stress it is under when compared to our responses - their troubles are much worse however.

I'm not sure I helped move the conversation forward but I am sure we must continue to talk about it.

Dr. Wood: There is no decreasing demand for dermatologists unless you listen to advocates of managed care who would like to end direct access. Ultimately, consumers will decide if they are willing to put up with the inferior care that results from not having direct access. My complaint is that so few doctors, especially the ones in academic teaching positions, medical school deans, and other leaders, are sounding the alarm to tell patients about the inferiority of managed care systems. Instead, we have department chairs and medical school deans who are pandering to managed care. They are trying to make managed care work instead of trying to make sure it does not work.

Instead of condemning managed care for destroying the doctor patient relationship, these doctors are regarding the "managed care revolution" as something to which they can adapt, something that they can work within. The silence is deafening. You do not compromise with something that is evil and wrong. Managed care is a disease that must be fought and destroyed in an uncompromising manner.

Huntley: How about the issue of academic departments training non-physicians to be involved in providing dermatologic care?

Dr. Freedberg: I am glad that you have touched on the issue of paramedical personnel taking over dermatologic treatment. Some of the problem comes from our colleagues, using physician extenders. Perhaps we should look within our own ranks to set guidelines where we have the most potential for control. What do you think of this issue?

Dr. Wood: I agree that "physician extenders" are a long range danger to our guild. My concern is that after gaining some knowledge and confidence, they will want to be licensed to practice independently. I think that it is OK to train a nurse to do "acne surgery" under direct and immediately available supervision, but I do not think "licensed estheticians" should be independently running "acne treatment centers" as is the case now in California.

My point about capitated payment and managed care is that dermatologists who accept capitation will have an incentive to have nurses and others do even more. Direct access will not be desirable under capitation due to the effect on workload. My comment about some academic dermatologists talking about teaching more dermatology to primary care doctors may equally apply to "physician extenders." I remember being given a dermatology course in medical school which was just about the right amount to let me know when I should refer a case. As I learned more about dermatology, I began to refer fewer cases. My concern is that the financial incentives in managed care will divide our specialty into camps of "fee for service" vs. "capitated or HMO" who will have differing incentives with regard to the amount of dermatology that is taught to primary care providers. I am very opposed to the trend toward capitated payment schemes, although I predict that we will have a blend of both with the more affluent patients choosing fee for service.

Huntley: Any final comments?

Dr. Wood The demand for dermatologists will remain strong. Managed care advocates would have us believe that there are too many specialists and too few primary care doctors. That is nonsense. The highest quality of medical care demands that patients see specialists, primarily because of the complexity of modern medicine. Even dermatologists have difficulty with common skin diseases such as psoriasis and atopic dermatitis. Patients who do not have ready access to specialists are not happy because they want to perceive that they are getting the very best. Dermatologists do have to be sure that they stay on the cutting edge of advances in cutaneous surgery, wound healing, infectious disease, etc. -- all of these areas are subjects that other medical specialists would be happy to take over. We need to restructure our meetings so that popular courses are not "ticketed events" with limited participation. Any member of the AAD who wants to attend a seminar and signs up in a reasonably timely manner should be allowed to attend any meeting. It is the responsibility of the meeting organizers to adapt the format and the size of the rooms to meet the demand.

Dr. Freedberg: My final comments relate to the fact that we must continue "conversations" like these so that we learn together how to deal with the problems we face. None of us know all the right answers ( at least I am sure I don't) at a time of such dramatic change in the structure of medical care in this country. I believe we will serve the specialty and especially our patients best if we successfully promote such dialogues.

Dr. Wood's last remark made me realize that the issue of attendance at popular AAD sessions may be solved in the future as we learn to use the power of the Internet more fully. Perhaps exercises like this one will help us move down that path more rapidly.

Huntley: I am not sure this discussion served to solve any of the current issues of private practice, academia, and the pressures resulting from managed care. I hope that those in academia will realize the urgent and real concerns of our colleagues in private practice, and those in private practice will realize that the training programs are seriously attempting to address these issues.

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