The Opt-Outs: Otolaryngologists extol the benefits of third-party independence

R. Anders Rosendahl, MD, a thyroid surgeon in Austin, Texas, understands that many physicians may be afraid to move away from the traditional model for fear that they might not be able to draw enough patients. He countered that although physicians who provide a high quality of care may build a practice more slowly in the first year or so, they will build a base of clients who are looking at quality, rather than professional fees.

“There is a large market for doctors who provide a very high level of care for patients,” Dr. Asher said. He believes his model is more cost effective in the long run. “I order less expensive, invasive tests and procedures than I used to when I worked in more conventional large group and academic settings, and my patients get excellent results with less medications, surgery and side effects,” he said.

As for hospitals shying away from using “opted-out” surgeons, Dr. Rosendahl performs nearly all of his surgeries at three Austin-area hospitals at which he is on staff.

“Who says you have to be traditional?” he said. “Why don’t we do what works?”

Dr. Rosendahl switched to a third-party-free practice in February 2003 when he relocated from Houston to Austin. He said his practice usually draws one of two responses from competing or referring physicians. The first is a curious envy, with physicians eager to learn more about how the operation works for him—and could work for them. The other reaction is, admittedly, more cynical, one Dr. Rosendahl described as “a twinge of jealousy that they have not yet made the big decision yet.”

Still, those doctors will often refer patients to him. “The beauty of my practice is how simple it is,” Dr. Rosendahl said. “Nobody comes to my office because of the book that some insurance company gives them. People come to my office because somebody told them it’s a good idea.”

Is ‘Opting Out’ Right for You?

Most physicians who have gone the “opt-out” route say revenue can be down in the early years, as the practice builds its census and reputation. Things to keep in mind, according to doctors and the Association for American Physicians and Surgeons:

• Determine how much time your office staff spends on issues related purely to third-party payment. Include telephone calls with carriers, correspondence and study of carrier manuals. Tabulate the data to do a cost-efficiency review.
• The switch can be jarring for some patients. Educate current and potential new patients. Explain how the practice will work on a cash basis, and note that opting out of Medicare is a choice, not a sign that the government does not approve of the practice.
• Determine a scope of practice. What services will you offer? Where will they be offered? Can everything be done at one site? Do you need to be affiliated with a hospital?
• Craft a business plan. With your review of time spent on third-party issues in hand, calculate how many patients the practice needs to see to generate the revenue threshold deemed acceptable.
• Visit aapsonline.org. The site has one of the most comprehensive resource lists on opting out. It also contains a list of physicians across different specialties who have already made the transition.