Businesses everywhere are struggling with the coronavirus recession, and that includes the venerable doctor’s office.
The stakes are especially high for independent physicians and their medical practices — and the public at large.
Family doctors, who typically help people manage chronic conditions and maintain their general health, are being swamped with calls about COVID-19. They’re prescribing tests when appropriate and monitoring infected patients with calls and televisits.
They’re also comforting the “worried well,” a helping hand that isn’t generally reimbursed by health plans but is crucial to preserving hospital space and equipment for a surge in COVID cases.
“The true front lines are not in the ER — they’re right at my door,” said Dr. Guy Culpepper, who’s been in family medicine for over 30 years.
His practice, Bent Tree Family Physicians in Frisco and North Dallas, tested 140 patients at a drive-through facility. He said 20 were positive for COVID and 10 were hospitalized, including three in intensive care. The others were self-quarantined at home, which reduced the risk of spreading the disease.
“We believe we made a difference and helped save lives,” Culpepper said.
Yet his business is in trouble. Patient visits are down 85%, because of stay-at-home orders and general anxiety about going to a doctor’s office during a pandemic. While telemedicine visits have exploded, they don’t generate the same revenue, largely because there are fewer lab tests, X-rays and similar services.
Bent Tree’s revenue has fallen by half or more, he said, and it no longer covers overhead. He said the practice has furloughed 20 of about 70 employees, and cut pay by 20% for doctors and other providers.
“We could be in serious financial ruin within a matter of weeks,” Culpepper said.
Similar scenarios are playing out around the country. In a nationwide survey in late March, only one-third of primary care clinicians said their practices had enough cash on hand to function for four weeks. In a more recent poll, completed April 6, just over 80% said the COVID-related strain on their practices had been severe or close to severe.
The results “show that the new normal for primary care practices is a stressful way of operating,” said the Primary Care Collaborative.
Texas took an important step on March 17. Gov. Greg Abbott issued an emergency order that telemedicine consults be paid at the same rate as in-office visits. That’s helped a lot during the coronavirus crisis, doctors said, and many practices have ramped up their ability to treat patients by smartphone and computer.
But it’s not enough to close the financial gap in the state, especially with most elective surgeries and procedures being suspended.
“I’m hearing from everyone — everybody’s affected,” said Michael Darrouzet, CEO of the Texas Medical Association and former head of the Dallas County Medical Society.
In a recent survey of TMA members, over half said their practices faced cash-flow difficulties. That was the most common operational challenge, ahead of even ensuring the well-being of doctors and staff.
Some experts predict that many independent physician practices will close through a combination of early retirements and selling out to rivals or others, Darrouzet said. Many practices are banking on getting small-business loans through the federal stimulus package, but that may take a while.
One physician said it was easy and fast to apply for a federal disaster loan. Then he received an email that the loan decision wouldn’t arrive for 21 days.
“How do you call that a disaster response?” Darrouzet said. “If we don’t keep our medical community in business, we’ll weaken our ability to fight this” pandemic.
Independent practices are also considered a counterweight to the consolidation of the health care industry. More doctors are joining hospital physician groups and other large practices, but independents tend to charge less — almost 6% less in Texas, according to a study published in September.
“Not only that, there was no evidence of a difference in quality,” said lead author Vivian Ho, an economist at Rice University.
That should give insurers more reason to step forward and try to help the doctors, she said. Blue Cross of Idaho and Blue Shield of California recently agreed to make advance payments to doctors based on their usual billings. The advances can be repaid as business recovers.
That’s similar to a federal plan to let Medicare provide advance payments to hospitals and doctors.
In Texas, a lot of conversations are underway with big insurers but there are no breakthroughs yet, said Tom Banning, CEO of the Texas Academy of Family Physicians.
Insurers say it’s up to employers, which pay most of the tab for private health coverage in Texas. Of course, they’re retrenching now, too.
But if they could figure out a way to prepay for services, even a month at a time, that would make a lot of economic sense, said Dr. Benjamin Linden, who’s part of a practice in Highland Village.
Phone lines are ringing constantly yet revenue is down about 40%, he said. Moreover, several doctors in his practice are in their 60s or older, including Linden’s father. He worries about their vulnerability to COVID exposure — and doesn’t like the additional financial strain.
“It would be really nice if the insurance companies would front us some of the money we’d normally be receiving so we can stay open and take care of patients,” said Linden, who’s 34.
Dr. John Flores, who has a practice with his wife in Little Elm, started doing telemedicine visits about eight months ago, so he was ready to shift his entire workload when the virus hit. That’s helped offset a 40% decline in patient visits.
“We’re in a good position to weather this,” Flores said, in part because he runs a small, lean operation.
He would borrow from a life insurance policy, if necessary, and he’s more worried about a longer-term threat. If a recession lasts long, people won’t spend to treat chronic conditions, which could hurt them and his practice.
“What’s gonna happen in the fall?” said Flores, 54.
In Frisco, Culpepper is focused on getting through the near term. His practice has served over 30,000 patients, and he believes he’s still doing what he was called to do. “I’m not gonna retire; I love being a physician,” he said.
But he knows two doctors who recently retired, in part because of the financial challenge of navigating through the coronavirus. Rebuilding any company is difficult, especially late in a career.
Culpepper plans to apply for a small-business loan, although racking up debt gives him some pause.
“At age 62, it’s really hard to leverage everything,” he said. “But we have something the whole community needs.”