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Dynamic Chiropractic – September 15, 2015, Vol. 33, Issue 18

Patient-Centered Care vs. Payer Restrictions: Your Ethical Obligation

Patient Care Meets Successful Practice in the New Health Care

By James Lehman, DC, MBA, FACO

Do you have an ethical obligation to evaluate your patients, make a diagnosis and provide evidence-based, patient-centered health care, irrelevant to the payer restrictions?

My 33 years of active practice in New Mexico permitted me to meet and work with several former governors including David Cargo, Bruce King, Jerry Apodaca, Garrey Carruthers, Toney Anaya, Gary Johnson and Bill Richardson. The pursuit of legislative changes, which supported the chiropractic profession and improved access to our services for patients in need of relief of their painful conditions, often required gubernatorial support. Although I have many fond memories of these governors, one memory really sticks out.

The chair of the New Mexico Chiropractic Association's Worker's Compensation Committee, Dr. George Simmons, and I attended a worker's compensation meeting during the late 1990s that featured former Governor Garrey Carruthers as the main speaker. At the time, Mr. Carruthers was serving as president and chief executive officer of the Cimarron Health Plan, a managed care company he cofounded and later sold in 2004 to a national managed-care corporation. I will never forget his bold and somewhat braggadocios statement, "As I practice medicine…"

Recognizing he had a bachelor's in agriculture and a master's in agricultural economics and agricultural business from New Mexico State University, and a doctorate in economics from Iowa State University, I was certain that in New Mexico, those degrees did not permit him to practice medicine. Nonetheless, the former governor of New Mexico – and current president of New Mexico State University – bragged that he practiced medicine in front of worker's compensation physicians, nurses and physical therapists! Before you think out loud that Carruthers misstated his position or I misinterpreted his statement, let me offer evidence that managed care companies have often practiced medicine without a license.

Who's in Charge? How Managed Care Impacts Provider Behavior

ethics - Copyright – Stock Photo / Register Mark A debate took place in Fort Lauderdale, Fla., in 2000 that posed this question: "Do managed care plans practice medicine?"1 The panel of physicians, lawyers, patient advocates, and representatives from managed care held forth on this issue at a round table held during the Fifth Annual Conference of the National Comprehensive Cancer Network. Moderator Clifford Goodman, PhD, of the Lewin Group, a Washington-based health care consulting firm, posed the question and further asked if managed care companies should be held liable in a court of law for their decisions.

Robert C. Young, MD, then-president of Fox Chase Cancer Center, thought they should be held liable. He claimed that when a patient and physician determine a certain intervention is the best medical care and another set of physicians in an insurance company (managed care companies are considered insurance companies) decides it isn't, then the insurance company is practicing medicine. He went on to say that if this is the case, they should be subjected to the same liability risks physicians have when they practice medicine.

A legal perspective was offered by Gail Agrawal, JD, MHA, professor of law, University of North Carolina at Chapel Hill. She agreed that if a physician makes a medical decision, the physician is practicing medicine, whether the decision is made in a doctor's office, a hospital office or an insurance company. But she considered questions of regulation and liability a separate issue, complicated by the fact that regulation of medicine falls to the states (hence the reason why we have 50 different laws governing managed care).

The government's concern regarding rising health care costs and declining access to health care permitted managed care companies to prosper and grow in numbers. Spurred by the enactment of the Health Maintenance Organization Act of 1973, there are now more than 5,000 plans, including Medicaid, new consumer-driven health plans and health savings accounts.2

A group of scientists in Arizona researched the impact of managed care on physicians and published their findings in 1999. The perceptions of physicians regarding how managed care has affected them was sought through a survey of Arizona physicians.3

Respondents reported that participation in managed care has had significant and largely unpleasant effects on numerous aspects of medical practice: physician patient relationships, clinical decision-making, work conditions and settings, and overall satisfaction.

The Kaiser Foundation revealed that despite managed care's mandate to control costs, U.S. health care expenditures has continued to outstrip the overall national income, rising about 2.4 percentage points faster than the annual GDP since 1970.4 And Garson reported: "Ten years ago, the US healthcare system was declared "broken," and it has not improved. Fixes promised by managed care have not materialized. Premiums are rising. Hassles for patients and physicians abound. Nearly 45 million Americans are uninsured."5

As a result of managed care's failures, the Affordable Care Act was signed on March 23, 2010 in order to improve access to affordable care. To date, few chiropractors are providing services within the coordinated care organizations created by this historic health care reform. Medicare continues to restrict the chiropractic profession through economic credentialing with its requirements to perform appropriate evaluation and management functions and limited scope of reimbursement. Managed care companies and health insurance companies act as if they do not need to include chiropractic services without scope-of-reimbursement discrimination. And finally, most states do not reimburse chiropractors for services rendered to Medicaid recipients.

Our Question(s) to Answer

So, the question remains to be answered: How do chiropractors complete their ethical obligations to evaluate their patients, make a diagnosis and provide evidence-based, patient-centered health care, irrelevant to the payer restrictions?

Finding the answer requires not only competence and ethical behavior, but also the use of business skills. The successful chiropractor practicing post-Affordable Care Act must reinvent his skill sets, determine value of services and realize a need to change. I realize many chiropractors have decided to seek success with a cash-practice model. Although that may be the right decision for many DCs who have established practices and are willing to gamble on their future success, I do not recommend this business model for new graduates. I suggest chiropractors integrate into the new health care system and make affordable chiropractic services available to more Americans through coordinated care organizations.

The majority of chiropractors I know actually work within a mixed business model, which includes cash payments and third-party reimbursement from Medicare, personal injury, worker's compensation and health insurance (insurance company and/or managed care company). It is my opinion that because of continuing shrinkage of third-party reimbursements over the past 20 years and rising business expenses, chiropractors now realize smaller profits. In addition, third parties such as Medicare expect chiropractic evaluation and management to be performed without reimbursement.

Most often, chiropractors who belong to managed care panels are reimbursed at a lower rate than non-panel providers. If my opinions are correct, chiropractors must reinvent themselves and increase revenue in order to maximize profitability and be able to afford time to properly evaluate patients prior to performing procedures.

The most appropriate advice I may offer is related to strategic planning. As a private practitioner, you must first determine the hourly cost of providing services which cover:

  • Practice overhead
  • Your desired salary
  • A reasonable percentage of profit
  • Fees necessary to meet your goals

This necessary business activity must be performed if you intend to meet your ethical obligations to evaluate your patient, make a diagnosis and provide evidence-based, patient-centered health care, irrelevant of the payer restrictions.

Now ask yourself this question: "Do I charge what is necessary to meet my goals as demonstrated in my strategic plan?" If not, why not? As an old-timer in this profession, I suggest the vast majority of DCs accept what the insurance companies dictate with each Explanation of Benefits (EOB), which is much less than the amount necessary to generate the desired income to meet your goals.

I also suggest many chiropractors attempt to remedy the shrinking third-party reimbursement dilemma by reducing the time spent evaluating the patient and documenting the need for care. This strategy permits the DC to justify the scheduling of more visits per day in order to increase revenue, but in my opinion, this strategy is not a wise, long-term solution.

The Long-Term Solution: Provide More, Not Less

The long-term economic solution is to schedule more time with your patients, which permits time to provide high-quality health care, which meets the needs of your patients. Schedule fewer patients per hour and charge the fees necessary to meet your goals. Attempt to resolve the patient's needs and wants with fewer treatments over a shorter period of time.

You might want to reinvent yourself and your practice model in order to be profitable. For instance, you might want to seek training in specific soft-tissue treatments, pursue board certification in orthopedics and become a chiropractic specialist, or gain the training necessary to offer acupuncture services in addition to chiropractic care.

DCs interested in becoming employees of coordinated care organizations, such as a federally qualified health center or patient-centered medical home, must realize their personal value to the organization, meet credentialing requirements, request a list of privileges and develop a schedule that provides ample time for evaluation and management, and recording of findings in the electronic chart. For instance, the organization may be willing to hire a chiropractic specialist to evaluate and manage patients suffering with chronic pain within a primary care facility.

If you are interested in a salaried position, you should research the average incomes for physicians in your community and seek equal compensation. As a chiropractic specialist, you should be compensated at a physician level. If the organization does not require  a chiropractic specialty, you may be offered a mid-level salary, which is offered to non-physicians (APRN or PA). An independent contractor position is another option to consider. The organization may offer a compensation plan based upon the number of visits or an hourly salary.

A federally qualified health center and/or patient-centered medical home will expect that the chiropractic physician schedule ample time for both evaluation and management. At our community health center, chiropractic patients are offered 20-minute follow-up visits and the initial encounter is a 40-60-minute visit. The chiropractic specialist is expected to perform a history, physical examination, differential diagnosis and chiropractic procedures on every visit.

Chiropractors with an interest in maintaining a private practice may also contract with a coordinated care organization for a select number of hours per week. You might want to diversify your revenue stream and patient population by providing chiropractic services for 10-20 hours per week at a local community health center. It has been my experience that community health center patients often present with more challenging health problems. My patients often present with chronic pain and several comorbidities including history of abuse, PTSD, obesity, hypertension, drug addictions, HIV+, heart disease, diabetes, and mental health issues. The underserved population appreciates patient-centered, hands-on care provided by chiropractic physicians.

In spite of the shrinking reimbursement problems posed by managed care companies, insurance companies, Medicare and Medicaid, you have an ethical obligation to evaluate your patients, make a diagnosis and provide evidence-based, patient-centered health care, irrelevant to the payer restrictions. You also have an ethical obligation to be successful and make a profit that enables you to offer medically necessary chiropractic services to patients in need.

Editor's Note: Contact the author with questions and comments via email at .


  1. "Debate: Do Managed Care Companies Practice Medicine?" Cancer Network, May 1, 2000.
  2. "States Turn to Managed Care to Constrain Medicaid Long-Term Care Costs." Agency for Healthcare Research and Quality, April 9, 2014.
  3. Warren MG, Weitz R, Kulis S. The impact of managed care on physicians. Health Care Manage Rev, 1999;24(2):44-56.
  4. "Trends in Health Care Costs and Spending." Kaiser Family Foundation Health Care Marketplace Project, September 2007.
  5. Garson A. "Current Perspective: The US Healthcare System 2010 – Problems, Principles, and Potential Solutions." Circulation, 2000;101:2015-16.

Click here for more information about James Lehman, DC, MBA, FACO.

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