Categories
Outpatient Practice

How To Do A Disability Exam

Physicians have two roles in disability determination: (1) recommending disability as the attending physician of their patients and (2) doing an independent medical examination consultation for disability granting organization (such as an insurance company or Social Security). These are two very different tasks.

First, it important to remember that we as physicians do not grant disability retirement. We can only recommend disability – disability retirement can only be granted by the employer, the insurance company overseeing the disability insurance policy for the employer, or the government agency providing disability benefits. Over the past 30 years, I have filled out hundreds of disability forms for my patients, done dozens of independent medical examinations for insurance companies or employers, and reviewed hundreds of independent medical examinations for organizations that grant disability. Here is what you need to know.

When is a patient disabled?

Put simply, a patient is disabled when they have a physical or mental impairment that prevents them from performing their job. The key words are “their job” – a medical condition that prevents someone from doing one job may not prevent that same person from doing a different job. For example, a partial foot amputation may be disabling for a road construction worker but not disabling for a telemarketer. Usually, disability benefits are granted when an employee can no longer do the job they were hired for, but some companies will not grant disability benefits if an employee can be retrained a different job within the company. For example, a factory worker who develops occupational asthma from a chemical used in manufacturing might be re-trained to work in the shipping department where finished products are stored.

In addition, disability is considered when the employee is unable to perform regular full-time duties despite reasonable accommodation. It is often far less expensive to the employer to provide an accommodation to an employee than to hire a replacement, train that replacement, and face increased disability insurance premiums if the employee goes on disability. As an example, an employer could assign an employee with knee arthritis an office on the first floor so that the employee does not have to walk up multiple flights of stairs every day.

Although there is a lot of variation between different disability-granting organizations, the common requirements to be granted disability include:

  1. The medical condition must either be new since the applicant began employment or if it is a pre-existing condition, it must have worsened since the date of initial employment.
  2. The medical condition must have a diagnosis (or tentative diagnosis). A symptom alone, such as shortness of breath, is generally not grounds for disability unless there is a diagnosis to go along with it (such as COPD).
  3. The medical condition must be of sufficient severity to prevent the applicant from doing their regular employment duties.
  4. The medical condition is expected to be “permanent”. This generally means lasting at least 12 months. In this sense, permanent does not necessarily mean forever.
  5. There must be objective evidence that the condition causes impairment. For this reason, it is very difficult for patients with chronic pain syndromes (migraine headache, fibromyalgia, etc.) to get disability without collaborating x-ray, EMG, or physical examination abnormalities. Similarly, applicants with conditions such as chronic fatigue syndrome that lack abnormalities on diagnostic tests are often denied disability.

The attending physician’s role

When a patient applies for disability through their employer, one of the first steps is for the employer (or employer’s insurance company) to contact the patient’s attending physician to get detailed medical information. Before giving out any information to the employer, the attending physician must confirm that the patient has given permission for release of their medical information. I was almost conned once when a patient’s ex-spouse sent me a letter requesting medical information posing as an employer. However, there was no signed release of information document and when I contacted the patient to clarify the medical information release, I found out that it was all a ploy.

These disability forms are often several pages long and can require as long as a half hour to complete. The time required to fill these forms out is usually not billable to the patient’s regular health insurance company so it is a good idea to have a written office policy for form completion with a fee schedule for filling out disability paperwork. Usually, payment of these fees is required in advance from the patient. If medical records are requested, then a per-page copying charge is also common practice. Although some disability insurance companies will pay a fee for the physician to complete these forms, most of the time it is the patient’s responsibility to pay for form completion. In my own practice, if the form only required a minute or two of my time, I would not bother to bill the patient – it often took more time to create the bill than it did to fill out the form. But for extensive forms, for patients with multiple disability applications, and for requests for extensive photocopies of medical records, I would require payment.

The information required will vary by employer/insurance company but in general, there are several things that they will want to know:

  1. What is your diagnosis? This should be a medical condition and not a just a symptom. If the patient’s work-up is in progress and you are not yet sure of the specific diagnosis, then indicate that the diagnosis is suspected. If the work-up is just beginning, then it is reasonable to report that you require “X” number of weeks to determine a diagnosis – in that situation, the patient can apply for temporary disability pending full medical evaluation.
  2. What are the disabling symptoms? Common symptoms contributing to disability include dyspnea, impaired mobility, visual impairment, angina, fatigue, cognitive impairment, etc.
  3. Is the patient’s medical condition permanent or temporary? Many conditions that are disabling today may improve with a treatment period of 6 months or so. Permanent disability means impairment lasting more than 12 months. Employers will generally be less strict about granting temporary disability benefits and will often approve temporary disability with a simple administrative approval. Permanent disability requires a more extensive process that generally involves getting one or more independent medical examinations and may involve a disability hearing.
  4. When did the condition become disabling? A condition that was disabling before the patient began his/her employment will generally result in denial of disability benefits.

Attending physicians have an inherent conflict of interest when filling out disability paperwork. The physician may not want to disappoint a patient with whom they have longstanding doctor-patient relationship. The physician may get pressured by the patient to help them get disability benefits. Or the physician may fear that the patient will leave the practice if the physician does not support their disability application. Because of this conflict of interest, most employers and disability insurance companies will require an independent medical examination prior to determination of permanent disability.

The independent medical examiner’s role

If the patient’s attending physician recommends disability retirement, the next step in the disability process is usually an independent medical examination (IME). This is done by an impartial physician having no relationship with the patient. The physician should be experienced with the patient’s medical condition and should be knowledgeable about the evaluation of impairment.

Agree on a fee

The IME should be billed to the employer or disability insurance company and not to the patient’s health insurance company. In a large medical practice, this will require you to make prior arrangements with your billing department so that the bill does not inadvertently go out to Medicare or the health insurance company. Most practices will set their fee schedule to charge more than whatever their best paying commercial health insurance contract will pay (anything over that contractural amount is written off). An IME is one of the few times that the physician actually gets paid the amount of their fee schedule. Before agreeing to do an IME, be sure that there is a fee schedule agreement in place. Most IMEs will be a level 4 or level 5 consult. Also, determine up front if additional testing will be covered. Usually, simple office tests such as an EKG or office spirometry will be covered but more extensive testing such as full pulmonary function tests, stress tests, and formal neuropsychological testing requires prior approval.

Review the records

An IME is essentially a consult and like any consult, it starts with a review of the medical records. These can range from a few pages of office notes to thousands of pages of electronic medical record print-outs. My practice was to review these prior to the patient’s office visit and then keep track of the time required. If the records are excessively voluminous, then get an agreement up front about an additional hourly fee for extensive record review.

Do a complete H & P

An IME is usually a comprehensive evaluation and should include a full history, past medical history, review of systems, physical examination, and summary of previous testing. The physical exam should at least cover the areas relevant to the patient’s symptoms. That means documenting a mental status exam in a patient applying for disability due to a psychiatric condition or documenting a cardiac exam in a patient applying for disability due to heart failure. Although it is important to be thorough, when it comes to your final report, more documentation is not necessarily better. I have seen IME reports in excess of 50 pages long with extraneous filler documentation. For example, when reporting a disability applicant’s dietary history, summarize it in 1-2 sentences and don’t list a menu of everything they ate in the past two weeks. Be complete but also be concise.

What is the diagnosis?

The primary diagnoses should be what you have determined that the patient has based on your evaluation. Frequently, your diagnosis may differ from the diagnosis given by the patient’s attending physician(s). Because the IME reports are often sent to the patient’s regular physicians, it is best to word your opinion non-judgmentally. Rather than saying “I determined that the patient has osteoarthritis and disagree with the patient’s treating doctor that she has rheumatoid arthritis”, it is better to state: “My diagnosis is osteoarthritis and I find no evidence of active rheumatoid arthritis at this time.” This allows the patient’s regular doctor to save face and avoids engendering a combative relationship between the doctor and the patient’s employer or disability insurance company.

State why the patient is impaired to perform regular full-time work duties

This generally requires you to have familiarity with the patient’s job description. Simply having a medical condition does not equate to disability; that medical condition must result in a physical or mental impairment that prevents the patient from doing their job. Whenever possible, include objective testing or physical examination findings that confirm impairment. For example, “The claimant has COPD with severe obstruction on spirometry and an oxygen saturation of 82% on room air that indicates a need for supplemental oxygen. The need for oxygen precludes continued work as a furnace repairman”.

Estimate recovery time

Permanent impairment generally implies that a patient will be disabled for more than a year. But that does not always mean that the patient will be disabled forever. For example, a patient with liver failure due to cirrhosis may be disabled today but may be able to return to work two years from now if the patient undergoes liver transplantation. Disability benefit recipients frequently undergo periodic re-evaluation to determine if benefits should be continued or terminated. It is within your purview to advise when such a re-evaluation should occur.

Know where to send the report

The physician performing the IME is being consulted by the employer, insurance company, or government agency that requested the IME. The final report should be addressed to them and not to the patient’s primary care physician or other treating physicians. It is best to not send copies to the patient’s attending physicians – that responsibility usually lies with the organization requesting your IME.

You are not the treating physician

Specialists are accustomed to providing treatment recommendations in consultation reports. An IME is a very different type of consultation. It only involves evaluation and not management. Nor will you be doing any follow-up. Do not prescribe medications.  Do not refer the patient to another specialist. Do not order tests without prior approval by the agency requesting the IME. Do not recommend specific treatments – the agency requesting your IME does not have the authority to prescribe medications or initiate work-ups. However, if you find something potentially life-threatening, the it is appropriate to call the patient’s attending physician to alert them. For example, I once did an IME that included getting a chest X-ray. The X-ray showed a probable undiagnosed lung cancer. I called the patient’s primary care physician so that he could initiate a work-up. I included documentation of the finding and my conversation with the attending physician in my IME report for medical-legal protection of both me and the agency requesting the IME.

Unsuitable for a job does not mean disabled for that job

Unlike conditions such as depression, schizophrenia, and bipolar disorder, personality disorders are rarely grounds for psychiatric disability. However, personality disorders can cause a person to be unsuited for a particular job. For example, a customer service employee with an anti-social personality disorder who punches one of the company’s clients does not warrant disability retirement on the basis of his personality disorder. Personality disorders usually originate in childhood and pre-date employment. One out of ten Americans have a personality disorder – there is not enough money in the U.S. economy to give them all disability retirement.

Similarly, an employee who who develops anxiety because of consistently poor job performance evaluations does not warrant disability retirement on the basis of anxiety disorder. A vegetarian who develops dysthymia when working at a slaughterhouse should not be put on psychiatric disability. These are jobs that they were never suited for in the first place.

Disability determination can be particularly difficult when an employee is not suited for a particular job and then that in turn results in psychiatric symptoms, such as anxiety, depression, or aggression.

Common disability conundrums

  1. Asthma. A confident diagnosis of asthma requires both a history compatible with asthma and obstructive changes on spirometry. I have frequently seen patients who apply for disability due to treatment-refractory asthma who have had multiple spirometry tests that were all normal. These patients may have asthma but if they never have obstruction on pulmonary function testing, then their asthma is unlikely to be of sufficient severity to warrant disability retirement. Often, they have an alternative diagnosis, such as vocal cord dysfunction. Occupational asthma can be more problematic since patients may only have obstructive changes when they are actually in the workplace. In this situation, obtaining workplace spirometry is ideal. At the least, a methacholine challenge test in the pulmonary function laboratory to confirm inducible bronchospasm should be obtained.
  2. Diseases causing dyspnea. Like pain, dyspnea is a subjective symptom. However unlike pain, dyspnea has quantifiable findings with pulmonary testing. When patients claim disability due to conditions causing dyspnea, there must be objective evidence of pulmonary (or cardiac) impairment. This generally means a full set of pulmonary function tests for patients with lung disease. If the patient’s subjective dyspnea is out of proportion to the PFT findings, then a cardiopulmonary exercise test can be valuable. If the dyspnea is also significantly out of proportion to the exercise test findings, then disability retirement will generally be denied.
  3. Heart failure. Medical science has greatly improved the management of congestive heart failure over the past 25 years. With beta-blockers, ACE inhibitors, and cardiac rehab, patients can have substantial improvement in their exercise tolerance and even normalization of their left ventricular function over time. Do not rely solely on cardiac imaging tests and stress tests from many years in the past. If you are not sure of the patient’s current hemodynamic status, it is reasonable to ask that new testing be performed. However, do not rely on overly simplistic, “one-size-fits-all” ejection fraction thresholds for disability determination. For example, an ejection fraction of 40% might be disabling for longshoreman but not disabling for an accountant.
  4. Chronic pain syndromes. Pain is real but is unfortunately not objectively measurable. Moreover, major goals of comprehensive chronic pain management programs are not just to control pain (with medications, physical therapy, etc.), but also for the patient with chronic pain to be able to live as normal of a life as possible despite pain. Exercise is a major component of the management of chronic pain, particularly in conditions such as fibromyalgia. Disability retirement can often make chronic pain more difficult to manage by fostering a more sedentary lifestyle. For these reasons, conditions such as chronic migraine and fibromyalgia are rarely grounds for permanent disability unless these conditions are accompanied by objective findings on X-rays or other tests.
  5. Depression. Psychiatric conditions, such as depression, pose significant challenges for independent medical examiners. Unlike medical conditions such as heart failure and asthma, the examiner relies almost entirely on the patient’s history and the mental status exam. The degree of depression is important – major depression is generally disabling but dysthymia is generally not disabling. Also, disability applicants can sometimes overstate their symptoms in order to obtain disability – the use of inventory questionnaires that identify exaggeration, overstatement, or malingering can be valuable. Depression tends to improve with time and treatment, so re-examination for continuation of disability benefits in 1-2 years is usually advised. Sometimes, patients (or their attending physicians) will have significant improvement in dyspnea but will claim that return to the workplace will cause their depression to relapse. This is frequently more of an unfounded fear than a real threat. A compromise can be a gradual return to work with careful psychiatric follow-up during the return.
  6. Obesity. This is becoming an increasingly difficult issue for employers and disability insurance companies due to the rapid rise in obesity rates in the United States. Obesity by itself is generally not grounds for medical disability but the complications of obesity can be (arthritis, etc.).
  7. Sleep disorders. Sleep apnea and narcolepsy are very common.  In the past, these were almost always grounds for disability retirement. However, with advances in CPAP devices for sleep apnea, most workers with sleep apnea can be adequately controlled. Moreover, most current CPAP devices can be interrogated to determine patient compliance. Similarly, pharmacologic therapy has greatly improved outcomes in patients with narcolepsy. There are simply too many Americans with sleep disorders to give everyone disability retirement. In order to be impaired, there should be evidence of patient compliance with treatment and a recent polysomnography test (for sleep apnea) or multiple sleep latency test (for narcolepsy) while the patient is on maximal medical therapy in order to substantiate impairment.
  8. Cancer. In past editions of the American Medical Association’s Guides to Permanent Impairment, it was stated that patients with cancer should be considered impaired for 5 years after a cancer diagnosis. Cancer treatment has come a long, long way since then and simply having cancer does not imply that the patient is impaired from their cancer. For example, some leukemias can be cured with stem cell transplant. Chronic lymphocytic leukemia can be well-controlled with medications for years or decades. Patients with breast cancer are frequently able to be cured with surgery, radiation, and chemotherapy (even those with axillary lymph node involvement). Grounds for disability due to cancer can include disabling side effects of treatment (for example, nausea and vomiting from chemotherapy), progression of cancer despite treatment, and advanced cancer with no reasonable hope for response to treatment.
  9. Immunosuppression. Drugs used to chronically suppress the immune system are more widely used than ever before – for cancer chemotherapy, for transplant rejection prevention, and for inflammatory disease treatment. These drugs can impair the body’s ability to fight off infectious diseases. Many workers are regularly exposed to infectious diseases in their workplace: flight attendants in crowded aircraft, teachers in classrooms fully of children with colds, and healthcare workers caring for infected patients. Fortunately, most of these workplace exposures are to respiratory viruses. For viruses such as influenza and COVID, there are effective vaccines. Most of the other common respiratory viruses (such as common cold viruses) are generally not excessively risky to immunosuppressed persons. Instead, the immunosuppressed person’s greatest danger is from bacterial infections and opportunistic viruses such as CMV – these pathogens are generally not readily transmitted in a workplace. When assessing impairment from immunosuppression, the independent medical examiner should consider the risk of the specific pathogens that a disability applicant is likely to be exposed to in the workplace.
  10. COVID. In the beginning of the pandemic, some workers applied for disability if they had risk factors for severe COVID or death from COVID if they were to have a workplace exposure. This was a challenge because almost every workplace had the potential for exposure to infected people. Further, with COVID risk factors of age over 60 years old, obesity, hypertension, and diabetes, an enormous percentage of the U.S. workforce was at risk. Now, with effective vaccines that can prevent severe infection and death, there are few, if any, situations where workers with risk factors should be put on disability retirement. Nor should personal refusal to get vaccinated be grounds for disability retirement.

The importance of fair disability processes

Ultimately, disability benefits are paid by employees. Social Security disability is paid for by all of the workers who contribute to Social Security in the form of payroll taxes. Insurance companies fund disability benefits from employee disability insurance premiums. Workers compensation is funded by premiums paid by employers who then include the cost of those premiums in employee benefits. The role of the independent medical examiner is to ensure that those workers who are truly disabled have access to benefits and to protect those benefits from being used up by those who are not truly impaired.

May 16, 2022

Categories
Academic Medicine Physician Retirement Planning

Retirement Planning For University Physicians

University-employed physicians (and all university faculty for that matter) have more retirement savings options than most physicians in private practice. Unfortunately, many of the decisions about these options have to be made at the time of hiring. This is a time in young physicians’ lives when they are least knowledgeable about personal finances and least equipped to make these decisions. This post will cover university faculty retirement planning with an emphasis on academic physicians at the beginning of their careers.

Summary Points:

  • Academic physicians have more retirement savings options than other physicians
  • Contribute the maximum amount into your 415(m)
  • Maximize 457 contributions before contributing to a 403(b)
  • 403(b), 457, and 415(m) plans offer hidden tax advantages
  • The decision about contributing to a state teacher’s retirement system versus an alternative 401(a) retirement plan is complex

The number of decisions that new university physicians have to make when they sign their employment contracts can be overwhelming. Will you be in the tenure track or clinical track? Who will be your mentor(s)? Which weeks do you want to block out for vacation over the next year? Where will your office be? What teaching assignments would you prefer? Fortunately, as months and years go by, you can change your mind about most of these decisions. But when it comes to retirement plan participation, some of the decisions you make initially are irrevocable and you cannot change your mind a few months later.

Understand your retirement options

Every university’s retirement plans are a little different and not all retirement savings options will be available to physicians at every institution. Here are the most common options:

  • Base retirement plans (401(a) plans). These are generally qualified retirement plans covered by section 401(a) of the Internal Revenue Code. Each state will have different specific plans – here in Ohio, university physicians can choose between the State Teacher’s Retirement System (STRS) or the Alternative Retirement Plan (ARP). In both plans, a fixed percentage of the physician’s salary is contributed pre-tax to the plan with a matching contribution from the university. When contributed to STRS, the plan can function essentially as a pension with a fixed amount of monthly income for life. When contributed to the ARP, the physician selects among a number of investment options (typically mutual funds) that are controlled by the physician with no guarantee of monthly income in retirement (very similar to a 403(b) plan). Both of these plans serve as a substitute for Social Security so physicians are ineligible for Social Security for their income earned from the university.
  • 403(b) plans. These are deferred income retirement plans for employees of non-profit organizations. Most universities are non-profit so 403(b) plans are available to most academic physicians. These are essentially the same as a 401(k) (deferred income retirement plan in a for-profit company). In 2022, you can put up to $20,500 per year into a 403(b) (up to $27,000 if over 50 years old). This is money taken out of your paycheck pre-tax and then you pay federal and state income tax on it when you take money out of the account in retirement.
  • 457 plans. These are deferred income retirement plans for government employees. Faculty at public universities are usually considered state government employees and are eligible to participate in 457 plans in addition to the university’s 403(b) plan. The contribution limits are the same: $20,500 per year if under age 50 and $27,000 per year if over age 50. By contributing to both a 457 and 403(b), physicians at state-supported universities can put away a combined amount of up to $41,000 per year ($54,000 if over age 50). Although fundamentally similar to 403(b) plans, there is one unique advantage of the 457 plan in that unlike the 403(b) plans, there is no tax penalty for early withdrawal before age 59 1/2 years old.
  • 415(m) plans. These are deferred income retirement plans for highly paid government employees earning more than $305,000/year in 2022 in salary and bonuses or with contributions more than $61,000 to the university’s base retirement 401(a) plan (STRS or ARP). Many physicians at public universities will fall into this category since physicians command relatively high salaries compared to other university faculty and compared to regular state government employees. Contributions to 415(m) plans can be made by the employee, the employer (i.e. the university), or both, depending on each university’s specific plan. In essence, the 415(m) plan allows physicians and other highly paid university employees to put away more for retirement after the annual base retirement 401(a) contribution limits have been reached.
  • Traditional and Roth IRAs. These are not sponsored by the university but anyone can contribute to a traditional IRA. Because the income limit to contribute pre-tax money into a traditional IRA is $144,000 per year if filing single in 2022 ($214,000 if filing jointly), most physicians are not eligible to contribute pre-tax dollars into a traditional IRA, nor are they able to contribute post-tax dollars directly into a Roth IRA. However, physicians can contribute post-tax money into a traditional IRA and then promptly convert it into a Roth IRA (‘backdoor’ Roth). As I have posted previously, I think that everyone should have a Roth IRA as part of a diversified retirement portfolio, even if it requires doing a backdoor Roth.

The tax advantages of deferred compensation options

A widely discussed advantage of deferred compensation retirement plans, such as the 403(b), 457, and 415(m) plans, is that you can defer paying income tax on the withdrawals until you are in retirement when you will likely have a lower income tax rate. Although that may be true, it is impossible to predict what the income tax rates will be 35 years from now when you are retired. They may be higher, lower, or the same as they currently are and therefore, depending on the amount that you are withdrawing each year, your federal income tax rate could be higher, lower, or the same as it currently is. If your income tax rate is the same, then the amount of take-home money that you have after taxes will be the same whether you pay income tax now and invest the money or contribute the money to a deferred income investment and pay income tax later. But there are two often-overlooked advantages to using a deferred income retirement plan:

  1. Reduce your income tax rate today. When you contribute to a deferred income retirement account, you effectively reduce your taxable income that year. Thus, you end up paying less tax on all of your take-home income. For example, assume you have an annual income of $250,000 and you are married, filing jointly. Your effective federal income tax rate for 2022 is 16.81%. If you contribute $20,500 to a 403(b), your taxable income drops to $229,500 and your effective federal income tax rate drops to 16.16%. The difference in effective tax rates is 0.65% and this results in you paying $1,492 less in taxes on the $229,500 than you would have at the higher tax rate. In other words, by contributing to a 403(b), 457, 401(a), or 415(m) plan, you have in essence given yourself a tax deduction!
  2. Avoid paying investment taxes twice. If you were to put the $20,500 into a regular post-tax investment (such as a mutual fund) instead of contributing to the 403(b), then not only do you pay income tax on that money this year but you will also pay capital gains tax when you eventually cash-out the post-tax investment AND you will also pay taxes on the annual dividends and interest from those investments every year that you hold those investments. You can avoid the capital gains, dividend, and interest taxes by contributing to a backdoor Roth IRA but the contribution limit is only $6,000 per year ($7,000 if over age 50). So, unless you put that retirement money in a Roth IRA, you will end up paying much more in taxes by putting retirement money in a regular post-tax investment than you will by putting that money in a deferred income plan.

Maximize 415(m) contributions

The decision about whether or not to participate in a university 415(m) plan is usually made at the time of initial employment and is irrevocable (meaning that you cannot change your mind later). At the Ohio State University, the choices are 0%, 4%, 8%, or 12%. If the 0% option is chosen, then you are electing to not participate in the 415(m) plan.

The 415(m) plan only kicks in when you have reached the annual contribution limit to your 401(a) base retirement plan ($61,000 in 2022) or retirement eligible earnings over $305,000. Therefore, you will only be contributing to the 415(m) plan for the portion of you income that exceeds the portion of your income subject to 401(a) contributions.

My advice is to take the maximum contribution to the 415(m). Even at the highest option (12% at OSU), it will still be less than your contribution to the university’s base retirement 401(a) plan (14% at OSU). Also, you can always increase or decrease contribution amounts to a 403(b) and/or 457 in order to allow you to meet annual expenses such as a new home purchase or student loan repayment. But once you commit to a percentage contribution to the 415(m) plan, you cannot increase it in the future.

Think very carefully about base retirement plan selection

A second irrevocable decision at the time of initial employment is which 401(a) base retirement plan to choose. Most universities will have something like a state teacher’s retirement system choice versus an alternative retirement plan choice. Both options have advantages and disadvantage and the choice that is best for one academic physician may not be the best choice for another academic physician.

Many financial advisors will tell you that you can get a higher rate of return by investing your retirement money yourself than you will get from a state teacher’s retirement system (STRS) pension. And they are right – you can, if you invest that money in a portfolio with a large percentage of stocks. But you should think of a pension as the non-volatile fixed income component of a balanced retirement portfolio. In this sense, it will substitute for the bond or annuity component of your portfolio had you not contributed to STRS. Therefore, by contributing to STRS, you will have the ability to safely put a higher percentage of your other retirement investments in more volatile investments with higher potential rates of return (such as stock and real estate mutual funds). Most academic physicians will contribute far more to their 403(b), 457, and 415(m) plans than they will to their base retirement 401(a) plans and these physicians can then afford to put more of their 403(b), 457, & 415(m) investments into stocks and real estate than they otherwise would have been able to.

Once retired, the predictable fixed income monthly pension income reduces the amount that you will need to keep in cash. The cash portion of your portfolio after you are retired serves to cover sudden, unexpected expenses and serves as a buffer to having to withdraw money from volatile accounts when the stock and bond markets fall. By keeping less money in cash, you can put more money into investments that over the long-term will result in greater wealth.

Every state will have different options for base retirement plans. In Ohio, it is either the State Teacher’s Retirement System of Ohio (STRS) or the Alternative Retirement Plan (ARP). Because most states have plans that are similar, I will use Ohio’s options of STRS versus ARP as examples. Some of the factors to consider when choosing between 401(a) base retirement options include:

  1. How long will you be employed by the university? In order to get the maximum annual pension, you have to contribute to STRS for 35 years. If you leave the university to go into private practice or if you take a job at a university in a different state, then you can either withdraw your STRS contributions plus a 3% annual interest rate or you can take a rather small pension when you eventually retire. Some states allow you to purchase credit for some of the years that you worked as an educator in other states making STRS contributions somewhat portable.  However, if there is a high likelihood that you will work at a university in your current state of residence for less than 35 years, then the ARP may be the wiser choice.
  2. Will you need health insurance? If you retire before you are eligible for Medicare (currently age 65), then you will need to purchase health insurance. If you purchase an individual insurance policy on the open market, it can be incredibly expensive. STRS participants have access to group health insurance with good coverage that is considerably less expensive. Once you are covered under Medicare, you will still need supplemental health insurance and once again, it will be less expensive to purchase though STRS. Dental and vision insurance for retirees is also available through STRS. The ability to purchase STRS health insurance can result in saving a considerable amount of money after retirement.
  3. How do you value other benefits? In addition to health insurance, participants in STRS have access to other benefits. If you become disabled, then you may be eligible for a monthly disability benefit. There are also options for monthly benefits for surviving beneficiaries (spouse or children). My father died when I was in college and his STRS plan helped support me while I was in medical school and 42 years after his death, my mother still receives a monthly STRS benefit.
  4. Your confidence in STRS. There is a reason that most corporations have eliminated pensions – they are expensive and have the potential to run out of money. Although most  teacher retirement systems are supported by their state governments, they are not immune to financial crisis. For example, the Illinois Teachers’ Retirement System is in danger of running out of money and not being able to pay its retirees. Each state’s system varies in terms of financial stability. My own opinion is that it is very unlikely that any state government will allow a teacher’s retirement system to default – if they do, that state will not be able to find new teachers willing to work there and the public education system would collapse. However, you should look at participation in an STRS plan as a type of investment and all investments have risk. For most states, that risk is equal or less than the risk of investing in bonds.
  5. You won’t have Social Security. At most public universities, physicians do not contribute to Social Security. The idea is that STRS substitutes for Social Security but even of you elect the alternative retirement plan (ARP) instead of STRS, you still do not contribute to Social Security. Therefore, when you are retired, you will not receive Social Security benefits. Even if you have contributions to Social Security from years that you worked for other employers or from outside consulting that you did while working at a university, your monthly Social Security payments in retirement will be considerably reduced. Therefore, if you elect the ARP instead of STRS, you will need to have a  higher percentage of your retirement savings in stable investments such as bonds, annuities, or certificates of deposit since you will not have the safety that a fixed income source brings to a diversified retirement portfolio.
  6. How old will you (and your spouse) live to be? Pension benefits are determined by actuaries who estimate how long the beneficiaries will live. If beneficiaries live a long time after retiring, then the monthly pension amounts have to be lower to be sure that the pension does not run out of money. On the other hand, if retirees die shortly after retiring, then the pension can afford to have higher monthly pension payments. Currently, a man who retires at age 65 can expect to live to age 83.2 years; a women retiring at age 65 can expect to live to age 85.8 years. If you anticipate dying younger than these ages, then the ARP may be better for you. If you anticipate living beyond these ages, then STRS becomes a better option. Factors to consider in estimating your longevity include any chronic diseases (diabetes, hypertension, etc.), personal or family history of cancer, age of death of your parents, your smoking history, whether you get regular vaccinations, your body mass index, etc.
  7. Your risk tolerance. Remember, a pension should be considered as the defined benefit component of a diversified retirement portfolio. As such, it is a low-risk component. Each person has a different risk tolerance. Those who have a higher risk tolerance will generally have a higher percentage of their retirement portfolio in higher risk stocks and real estate. Those with a lower risk tolerance will generally want to increase the percentage of their portfolio in low-risk bonds and fixed income. If you choose STRS, then the percentage of your overall retirement savings portfolio derived from your STRS pension should match your risk tolerance. If you find that contributing to STRS would make your overall portfolio diversification too conservative, then the ARP may be preferable.

What about the 403(b), 457, and Roth IRA?

The base retirement 401(a) plan will not be enough to fund your entire retirement portfolio. For most academic physicians, the largest component of their portfolio will be in their 403(b, 457, and 415(m) plans. As mentioned above, the 403(b) and 457 plans are very similar but the 457 plan’s lack of early withdrawal penalties gives it a slight advantage over the 403(b). For that reason, it is preferable to maximize annual contributions to a 457 plan before starting to contribute to a 403(b) plan. If you can afford it, ideally, you should be contributing to both.

Most universities will have options of directing contributions to different investment brokerages and to different mutual funds within each brokerage. It is within the 403(b) and 457 accounts that most people can create the proper risk diversification for their overall retirement portfolio by selecting funds that compliment fixed income sources such as STRS.

A Roth IRA is an essential component of a balanced and diversified retirement portfolio and everyone should have one. Ideally, one should contribute to all three options: a 403(b), a 457, and a Roth IRA. Maximizing annual contributions to all of these would add up to $47,000 per year and if you did that every year with an average annual rate of return of 8%, then after 35 years, you would have $8.7 million in retirement savings. However, $47,000 per year is beyond the reach of most people so I recommend doing an annual partial contribution to both a Roth IRA and a 457 initially. Once you reach the contribution limit of the 457, then increase your Roth IRA contribution to the IRS limit. Next, steadily increase your 403(b) contributions until you reach the IRS limit.

Academic physicians can save more

Physicians in private practice usually have access to a 401(k) or 403(b) plan… and that is about it. Physicians employed by public universities usually have access to a 401(a), 403(b), 457, and 415(m) plan. Moreover, most of the 401(a) plans include sizable employer matching contributions. Physicians in private practice will generally have a higher annual income than academic physicians. However, academic physicians can generally save more for retirement in deferred income plans with the tax advantages that come with those plans. For many academic physicians, these increased retirement savings can offset the lower annual income with the result that the decision between private practice versus academics can be based more on workplace preference and lifestyle rather than on economics.

May 12, 2022

Categories
Emergency Department Intensive Care Unit Medical Education

Clinical Interpretation Of Arterial Blood Gases

In the previous post, the physiology of the acid-base system was discussed. This post will focus on the practical interpretation of arterial blood gases for clinical diagnosis. The arterial blood gas (ABG) is usually the quickest lab test to obtain in a critically ill patient. In the emergency department, in the ICU, in the operating room, and during cardiopulmonary resuscitation, the ABG often leads to a correct diagnosis and directs initial treatment. There are four steps in interpreting the acid-base components of an ABG:

  1. Determine if the primary process is an acidosis or alkalosis
  2. Determine if the primary process is respiratory or metabolic
  3. Determine if the primary process is appropriately compensated
  4. Check the anion gap

This post will focus on the acid-base components of the ABG and will not discuss oxygenation.

Steps 1 &2: Determine the main acid-base disorder

Although normal values for pH, PCO2, and HCO3 are in reality a range, it is much easier to assume a single normal numeric values for each when interpreting an acid-base disturbance. Therefore, assume normal values of:

  • pH = 7.40
  • PCO2 = 40
  • HCO3 = 24

If the ABG shows a pH < 7.40,  then there is an acidosis; if the PCO2 is elevated, then it is a respiratory acidosis and if the HCO3 is reduced, then it is a metabolic acidosis.

On the other hand, if the ABG shows a pH > 7.40, then there is an alkalosis; if the PCO2 is reduced, then it is a respiratory alkalosis and if the HCO3 is elevated, then it is a metabolic alkalosis. Therefore, each of the four primary acid-base disturbances can be defined as follows:

Respiratory Acidoses:

Respiratory acidoses can be divided into those that are acute (duration of minutes to hours) and those that are chronic (duration of days, weeks, or years). The patient’s clinical history will dictate whether the condition is acute or chronic. For example, a newly unconscious patient with a fentanyl ingestion 45 minutes ago will typically have an acute respiratory acidosis whereas a smoker with long-standing, stable COPD will typically have a chronic respiratory acidosis. There are six main causes of respiratory acidosis:

Respiratory Alkalosis:

Respiratory alkaloses can also be divided into those that are acute and those that are chronic. Once again, the patient’s clinical history will dictate whether the condition is acute or chronic. There are eight main causes of a respiratory alkalosis:

Metabolic Acidoses:

There are two subcategories of metabolic acidosis: (1) increased anion gap metabolic acidosis and (2) normal anion gap metabolic acidosis. The anion gap can be calculated using the equation:

Anion Gap = Na – (Cl + HCO3)

The anion gap is normally composed of miscellaneous anionic molecules in the blood such as albumin and phosphate. When the anion gap is increased, then there are abnormal anions in the blood that will result in a lowering of the HCO3 level. The anion gap is often reported from the lab when ordering an electrolyte panel but for general ABG calculation purposes, a normal value of up to 12 mEq/L can be assumed (normal range = 6-12 mEq). However, when the pH is very high (> 7.50), the anion gap will increase to 15-16 by uncovering anionic sites on albumin. Therefore, a slightly elevated anion gap is normal when the pH is very high. The anion gap can be decreased in conditions such as hypoproteinemia, hypophosphatemia, and multiple myeloma (the latter due to an increase in cationic monoclonal IgG levels).

There are five common causes of an increased anion gap metabolic acidosis and two common causes of a normal anion gap metabolic acidosis:

Note that aspirin overdose can cause both a respiratory alkalosis (by direct stimulation of the brain’s respiratory drive center) and a metabolic acidosis (by accumulation of acetylsalicylic acid in the blood).

Increased anion gap metabolic acidoses can be further subdivided into those that cause an increased osmolar gap (> 10 mOsm/L) and those with a normal osmolar gap (< 10 mOsm/L). The osmolar gap is the difference between the measured and the calculated osmolality of the blood and this is normally reported out by the lab when a plasma osmolality test is ordered. The two most common causes of an increased osmolar gap are (1) methanol poisoning and (2) ethylene glycol poisoning. These are critical diagnoses to make because neither ethylene glycol nor methanol blood levels are able to measured quickly and so the arterial blood gas is usually the only way to establish an early diagnosis in order to direct life-saving treatment. All of the other causes of metabolic acidosis result in a normal osmolar gap.

Metabolic Alkaloses:

There are two subcategories of metabolic alkalosis: (1) chloride responsive metabolic alkaloses and (2) chloride unresponsive metabolic alkaloses. Chloride responsiveness is defined by the urine chloride level: if the urine chloride is < 10 mEq/L, the metabolic alkalosis is chloride responsive and if the urine chloride is > 10 mEq/L, the metabolic alkalosis is chloride unresponsive. There are three common causes of a chloride responsive metabolic alkalosis. Although there are also three causes of a chloride unresponsive metabolic alkalosis listed below, the most common is corticosteroid medication.

Step 3: Determine if the main acid-base disturbance is compensated

Very frequently, there will be more than once acid-base disturbance simultaneously. For example, a patient with pneumonia can have both a respiratory acidosis (from respiratory failure) and a metabolic acidosis (from lactic acidosis due to sepsis). To determine if there is more than than one acid-base disturbance, there are compensation rules. If a patient meets the criteria for these rules, then there is a simple acid-base disturbance (i.e., only one acid-base disturbance). Many of these rules are cumbersome and involve using nomograms or complex formulas. The following are the compensation rules that I have used throughout my career that are simple, require minimal calculations, and easy to use:

  • Metabolic acidosis: The last 2 digits of the pH will equal the PCO2
  • Metabolic alkalosis: For every 10 mEq increase in the HCO3, there will be a 6 mm increase in the PCO2
  • Respiratory acidosis:
    • Acute: For every 10 mm increase in the PCO2, there will be a 1 mEq increase in the HCO3
    • Chronic: For every 10 mm increase in the PCO2, there will be a 3.5 mEq increase in the HCO3
  • Respiratory alkalosis:
    • Acute: For every 10 mm decrease in the PCO2, there will be a 2 mEq decrease in the HCO3
    • Chronic: For every 10 mm decrease in the PCO2, there will be a 5 mEq decrease in the HCO3

If the patient fails the simple acid-base disorder compensation rule, then there is more than one acid-base disturbance. The direction of change from the expected compensation in PCO2 (metabolic disorders) or HCO3 (respiratory disorders) will indicate what that second acid-base disorder is.

Although patients can rarely have three or even four different acid-base disorders occurring at the same time, most patients will only have one or have two occurring simultaneously. The table below describes the findings when there are two acid base disturbances:

Step 4: Check the anion gap

Always, always, always calculate the anion gap! If the anion gap is elevated, then there is an increased anion gap metabolic acidosis, even if the pH, PCO2, and HCO3 are all normal.  The combination of a metabolic acidosis plus a metabolic alkalosis can cause the ABG to appear normal and the only clue that the patient has acid base disorders will be the increased anion gap.

The “delta-delta” rule. The Greek letter delta (Δ)is often used in medical shorthand to mean ‘change in’. In a simple, compensated increased anion gap metabolic acidosis, the Δ anion gap should always be equal to the Δ bicarbonate. In other words, the increase in the anion gap in mEq/L from normal should equal the decrease in the HCO3 in mEq/L from normal. Once again, assume that the normal anion gap is 12 mEq/L and the normal HCO3 is 24 mEq/L. If these two values for Δ are not equal, then there is a second acid-base disturbance. For example, if the anion gap is 20 mEq/L (8 mEq/L above normal), then the bicarbonate should be 16 mEq (8 mEq/L below normal). If the change in bicarbonate is larger than the change in the anion gap, then there is a concurrent metabolic acidosis. On the other hand, if the change in bicarbonate is smaller than the change in anion gap, then there is a concurrent metabolic alkalosis.

Questions containing a completely normal ABG with an increased anion gap are a favorite of those who write questions for board examinations, and with good reason. A common scenario where this occurs is the patient with diabetic ketoacidosis (causing an increased anion gap metabolic acidosis) who is vomiting (causing a chloride responsive metabolic alkalosis). In this case, the decrease in the HCO3 from the metabolic acidosis can be offset by the increase in the HCO3 from the metabolic alkalosis – the ABG can look normal but the patient will still be very sick. The Δ bicarbonate will be less than the Δ anion gap. In this situation, the increased anion gap will be the only prompt for the emergency room physician to immediately start the patient on IV fluids and insulin.

There is a wealth of information contained in those four numbers: the pH, PCO2, HCO3, and anion gap. During emergent situations, such as during a cardiopulmonary arrest, there is not time to look up ABG interpretation in a book or on-line reference. By being able to rapidly analyze the acid-base status, the clinician can use that information to direct life-saving treatments. Memorization of the differential diagnosis of each of the four primary acid-base disturbances and memorization of the compensation rules is essential to the practice of emergency medicine, anesthesia, and critical care medicine.

May 9, 2022

Categories
Emergency Department Intensive Care Unit Medical Education

Physiology Of Arterial Blood Gases

Part 1 of this post will cover the physiology behind arterial blood gases and part 2 will cover clinical interpretation of arterial blood gases. Arterial blood gases (ABGs) are an essential part of the evaluation of unstable patients. In unconscious patients who are unable to give a history, the blood gas can provide key data that can lead to a diagnosis long before other test results come back. In the intensive care unit and in the operating room, the ABG can provide critical results that can direct life-saving treatment. But optimal use of the arterial blood gas requires the physician to be able to rapidly interpret the results of the ABG. The two main components of the arterial blood gas are (1) oxygenation and (2) acid-base status. This post will focus on the background physiology of the acid-base components of the ABG. If you are primarily interested in the use of ABGs in clinical decision making of acid-base disorders, skip ahead to the next post.

Components of the ABG

Fundamentally, there are 5 main results in an arterial blood gas report: pH, PO2, PCO2, HCO3, and O2%. The pH is measured directly and indicates whether the patient is acidemic (pH < 7.40) or alkalemic (pH > 7.40). The PO2 is the partial pressure of dissolved oxygen in the blood. The PCO2 is the partial pressure of dissolved carbon dioxide in the blood. The HCO3 is the bicarbonate concentration which is very similar to the serum CO2 reported in an electrolyte panel (the serum CO2 is the total of everything that can be converted into CO2 in the blood including bicarbonate, carbonic acid, and dissolved carbon dioxide – it should not be confused with the PCO2 from the arterial blood gas which is a completely different value). The O2% is the oxygen saturation which is the percentage of hemoglobin binding sites that contain bound oxygen molecules. The normal values for each of these results are usually listed as a range of normal but for the purposes of analyzing the acid-base status, consider normal to be single numbers: pH = 7.40, PCO2 = 40 mm Hg, and HCO3 = 24 mEq/L.

Many ABG analyzer machines can also measure other values such as methemoglobin, carboxyhemoglobin, potassium, lactate, hemoglobin, etc. However, these tests usually need to be ordered separately and if only an ABG is ordered, then you will just get the 5 results as described above.

Acid-base regulation

Our bodies try to keep the pH as close to 7.40 as possible. The two ways that we regulate the pH are by (1) increasing or decreasing carbon dioxide excretion by the lungs and (2) increasing or decreasing bicarbonate excretion by the kidneys. When the carbon dioxide level of the blood is too high or too low, the kidneys compensate by increasing or decreasing the bicarbonate level of the blood by altering bicarbonate excretion in the urine. On the other hand, when the bicarbonate level is too high or too low, the lungs compensate by increasing the carbon dioxide level using hypoventilation or by decreasing the carbon dioxide level using hyperventilation.

Our tissues are constantly producing acids (in the form of hydrogen ions) and acid production can increase very rapidly with exercise. Therefore, there has to be an efficient way to get rid of acid as quickly as it is produced. This is done by converting hydrogen ions into carbon dioxide. In the blood, this is done by the enzyme carbonic anhydrase that first converts hydrogen ions into carbonic acid and then converts carbonic acid into carbon dioxide and water. The carbon dioxide is then excreted by the lungs in the form of exhaled carbon dioxide. When more acid (and thus carbon dioxide) is produced, for example, during exercise, the lungs can immediately dispose of that carbon dioxide by hyperventilation. In order to keep the pH at 7.40, we have to maintain a constant ratio of bicarbonate:dissolved carbon dioxide, as dictated by the Henderson-Hassalbach equation.

During conditions resulting in hyperventilation, the lungs get rid of more carbon dioxide and as a consequence, the blood PCO2 can become lower. Conversely, during conditions resulting in hypoventilation, the lungs are not able to get rid of carbon dioxide adequately and the blood PCO2 will rise.

There are other acids that are produced by metabolism that cannot be converted into carbon dioxide. These are called non-volatile acids and must be excreted by the kidneys. The kidneys can also excrete bicarbonate into the urine and can thus respond to a change in the blood carbon dioxide level by either eliminating or retaining bicarbonate. Unlike the lungs which can respond to increased carbon dioxide within seconds, it takes the kidneys 2-3 days to raise or lower bicarbonate levels with the result that the kidney’s full compensatory response to an acid-base disorder takes several days. However, the blood does have the ability to have a small but immediate effect on a changing carbon dioxide level by a chemical buffering mechanism. The result of this is that there are two responses to a high or a low carbon dioxide level: an acute compensation by chemical buffering and a chronic compensation from excretion of bicarbonate by the kidney. The buffering mechanism of the blood is fairly limited and can only result in a mild/limited degree of compensation compared to kidney excretion of bicarbonate.

Base deficit and base excess

In some situations, the ABG report will be resulted as “base deficit” or “base excess”. This is commonly used in the operating room by anesthesiologists. A base deficit refers to the amount that the bicarbonate level is too low and a base excess refers to the amount that the bicarbonate is too high. For practical purposes, base excess can be used synonymously with metabolic alkalosis and base deficit can be used synonymously with metabolic acidosis.

Acid-base disorders

Acid-base disorders can be divided into those that make the pH go up (alkaloses) or make the pH go down (acidosis). Each of these can be dividing into respiratory disorders that affect the carbon dioxide level and metabolic disorders that affect the bicarbonate level. Thus, there are 4 main groups of acid-based disturbances:

In a respiratory acidosis, the primary problem is that the blood carbon dioxide level is too high and the kidneys compensate by retaining bicarbonate. In a respiratory alkalosis, the primary problem is that the blood carbon dioxide level is too low and the kidneys compensate by increasing bicarbonate excretion into the urine. In a metabolic acidosis, the primary problem is that the blood bicarbonate level is too low and the lungs compensate by hyperventilating to reduce the blood carbon dioxide level. In a metabolic alkalosis, the primary problem is that the blood bicarbonate level is too high and the lungs compensate by hypoventilating to increase the blood carbon dioxide level.

As noted previously, the lungs can compensate to a metabolic acidosis or alkalosis within seconds but the kidneys take 2-3 days to fully compensate for a respiratory acidosis or alkalosis. However, there is a partial compensation to a respiratory acidosis or alkalosis by the buffering chemistry within the blood that happens immediately. For this reason, metabolic acidoses and alkaloses can be divided into those that are acute (occurring in minutes to hours) that are partially compensated by buffering and those that are chronic (occurring more than 2-3 days previously) that are more fully compensated by renal bicarbonate excretion.

It is important to note that a person can have more than one acid base disturbance at the same time. For example, a person can have a condition causing a metabolic acidosis and also simultaneously have another condition causing a metabolic alkalosis. Or, a person can have both a metabolic acidosis and simultaneously have a  respiratory acidosis. If there is a single acid-base disturbance, it is called a simple acid base disorder and if there are more than one acid-base disturbances, it is called a complex acid base disorder.

The next post will review the causes of acid-base disturbances and how interpretation of the arterial blood gas can be used to diagnose these disorders.

May 9, 2022

Categories
Epidemiology

Grading Each State’s COVID Response

Sometime next month, the United States will surpass one million reported deaths from COVID-19. So, how did your state compare in combating the pandemic? I graded each state by four measures: (1) total cases per 100,000 population, (2) total deaths per 100,000 population, (3) seroprevalence, and (4) percent of the population fully vaccinated. I then created a composite score using all four metrics to give an overall grade for every state plus Washington DC and Puerto Rico. Grades for each metric from A+ through F were assigned with 4 states getting any given grade.

  1. Total cases per 100,000 population. These are the cases reported by state health departments to the CDC as of April 28, 2022. The higher the number, the more documented cases occurred since January 2020 per capita. This number does not reflect the true number of cases since many people test positive with home test kits that are not reported to their health departments and many patients with mild or no symptoms do not get tested.
    • Grade A+ states: Puerto Rico, Oregon, Maryland, Hawaii,
    • Grade F states: Alaska, Rhode Island, North Dakota, Tennessee
  2. Total deaths per 100,000 population. These are the deaths reported by state health departments to the CDC as of April 28, 2022. The higher the number, the more deaths occurred since January 2020 per capita. Because the deaths from COVID are only counted if COVID is listed as a cause of death on the death certificate, these numbers are undoubtedly also an underestimate since COVID may not be listed on a death certificate if a person did not have a COVID test before dying or if a person died at home and no information about symptoms was available to the physician signing the death certificate.
    • Grade A+ states:Vermont, Hawaii, Puerto Rico, Utah
    • Grade F states: Mississippi, Arizona, Alabama, Tennessee
  3. Seroprevalence. This is from the February Nationwide Antibody Seroprevalence Survey. In this study, left-over blood samples from blood drawn from clinical labs are tested for antibodies against the COVID-19 virus. Notably, the specific antibodies tested for are those generated from actual infection and do not result from vaccination. The higher the number, the greater the percentage of the state’s population has actually had a true COVID-19 infection (of note, there is no recent data for North Dakota; because there was no data for Montana and New Hampshire from the February study, data from the January study was used for these two states). Overall, this study estimates that 57.5% of Americans have had a COVID infection. However, because antibody levels decline over time, many people who have had an infection many months previously will no longer have antibodies. Therefore, these numbers likely underestimate the actual percentage of the population that has had an infection.
    • Grade A+ states: Vermont, New Hampshire, Hawaii, Puerto Rico,
    • Grade F states: Iowa, Texas, Mississippi
  4. Percent of the population fully vaccinated. This is the percentage of people in each state that have received at least 2 doses of the Pfizer vaccine, 2 doses of the Moderna vaccine, or 1 dose of the Johnson & Johnson vaccine as reported by the CDC. This percentage reflects the entire population of the state, including young children who are not yet eligible to receive vaccinations and therefore the percentage of adults fully vaccinated will be higher.
    • Grade A+ states: Puerto Rico, Rhode Island, Vermont, Maine
    • Grade F states: Alabama, Wyoming, Mississippi, Louisiana
  5. Overall score. For each of the above four metrics, states (plus Washington D.C. and Puerto Rico) were ranked 1 through 52. The overall score was calculated by adding the ranks for each of the four metric and determining the average of those 4 numbers. For North Dakota, there is no data available for the seroprevalence study so the overall score was calculated by the average of the other 3 metrics.
    • Grade A+ states: Puerto Rico, Vermont, Hawaii, Maine
    • Grade F states: Tennessee, Mississippi, Arkansas, Alabama

Here are the scores for each state

Alabama

  • Case Rate per 100,000 = 26,524; grade: C-
  • Death Rate per 100,000 = 398; grade: F
  • Seroprevalence = 66.0%; grade: D
  • Percent Fully Vaccinated = 51.1%; grade: F
  • Overall Rank = 49; grade: F

Alaska

  • Case Rate per 100,000 = 33,479; grade: F
  • Death Rate per 100,000 = 166; grade: A
  • Seroprevalence = 61.0%; grade: C
  • Percent Fully Vaccinated = 62.3%; grade: C+
  • Overall Rank = 26; grade: C+

Arizona

  • Case Rate per 100,000 = 27,773; grade: D
  • Death Rate per 100,000 = 411; grade: F
  • Seroprevalence = 63.0%; grade: C-
  • Percent Fully Vaccinated = 61.5%; grade: C
  • Overall Rank = 48; grade: D-

Arkansas

  • Case Rate per 100,000 = 27,683; grade: D
  • Death Rate per 100,000 = 377; grade: D-
  • Seroprevalence = 64.0%; grade: D+
  • Percent Fully Vaccinated = 54.4%; grade: D-
  • Overall Rank = 50; grade: F

California

  • Case Rate per 100,000 = 23,281; grade: B+
  • Death Rate per 100,000 = 226; grade: B+
  • Seroprevalence = 55.5%; grade: B
  • Percent Fully Vaccinated = 72.0%; grade: B+
  • Overall Rank = 12; grade: A-

Colorado

  • Case Rate per 100,000 = 23,979; grade: B
  • Death Rate per 100,000 = 210; grade: A-
  • Seroprevalence = 47.9%; grade: A-
  • Percent Fully Vaccinated = 70.2%; grade: B
  • Overall Rank = 10; grade: A-

Connecticut

  • Case Rate per 100,000 = 21,204; grade: A-
  • Death Rate per 100,000 = 303; grade: C+
  • Seroprevalence = 44.4%; grade: A
  • Percent Fully Vaccinated = 79.2%; grade: A
  • Overall Rank = 11; grade: A-

Delaware

  • Case Rate per 100,000 = 26,902; grade: D+
  • Death Rate per 100,000 = 298; grade: C+
  • Seroprevalence = 54.0%; grade: B+
  • Percent Fully Vaccinated = 69.1%; grade: B
  • Overall Rank = 23; grade: B-

Washington D.C.

  • Case Rate per 100,000 = 20,112; grade: A-
  • Death Rate per 100,000 = 189; grade: A-
  • Seroprevalence = 63.6%; grade: D+
  • Percent Fully Vaccinated = 74.1%; grade: A-
  • Overall Rank = 13; grade: B+

Florida

  • Case Rate per 100,000 = 27,568; grade: D
  • Death Rate per 100,000 = 344; grade: C-
  • Seroprevalence = 58.4%; grade: B-
  • Percent Fully Vaccinated = 66.9%; grade: B-
  • Overall Rank = 35; grade: C-

Georgia

  • Case Rate per 100,000 = 23,689; grade: B
  • Death Rate per 100,000 = 356; grade: D
  • Seroprevalence = 63.8%; grade: D+
  • Percent Fully Vaccinated = 54.7%; grade: D-
  • Overall Rank = 37; grade: D+

Hawaii

  • Case Rate per 100,000 = 17,089; grade: A+
  • Death Rate per 100,000 = 99; grade: A+
  • Seroprevalence = 34.2%; grade: A+
  • Percent Fully Vaccinated = 78.2%; grade: A
  • Overall Rank = 3; grade: A+

Idaho

  • Case Rate per 100,000 = 24,947; grade: C+
  • Death Rate per 100,000 = 275; grade: B
  • Seroprevalence = 67.8%; grade: D-
  • Percent Fully Vaccinated = 54.0%; grade: D-
  • Overall Rank = 31; grade: C

Illinois

  • Case Rate per 100,000 = 24,686; grade: B-
  • Death Rate per 100,000 = 298; grade: B-
  • Seroprevalence = 60.8%; grade: C+
  • Percent Fully Vaccinated = 68.7%; grade: B-
  • Overall Rank = 20; grade: B

Indiana

  • Case Rate per 100,000 = 25,263; grade: C+
  • Death Rate per 100,000 = 350; grade: D+
  • Seroprevalence = 61.2%; grade: C
  • Percent Fully Vaccinated = 54.8%; grade: D
  • Overall Rank = 39; grade: D+

Iowa

  • Case Rate per 100,000 = 24,189; grade: B
  • Death Rate per 100,000 = 302; grade: C+
  • Seroprevalence = 70.7%; grade: F
  • Percent Fully Vaccinated = 61.9%; grade: C+
  • Overall Rank = 32; grade: C

Kansas

  • Case Rate per 100,000 = 26,561; grade: C-
  • Death Rate per 100,000 = 295; grade: B-
  • Seroprevalence = 62.2%; grade: C-
  • Percent Fully Vaccinated = 61.4%; grade: C
  • Overall Rank = 29; grade: C

Kentucky

  • Case Rate per 100,000 = 29706; grade: D-
  • Death Rate per 100,000 = 346; grade: C-
  • Seroprevalence = 56.6%; grade: B-
  • Percent Fully Vaccinated = 57.4%; grade: D+
  • Overall Rank = 42; grade: D

Louisiana

  • Case Rate per 100,000 = 25,226; grade: C+
  • Death Rate per 100,000 = 370; grade: D-
  • Seroprevalence = 68.9%; grade: D-
  • Percent Fully Vaccinated = 53.5%; grade: F
  • Overall Rank = 45; grade: D-

Maine

  • Case Rate per 100,000 = 18,124; grade: A
  • Death Rate per 100,000 = 169; grade: A
  • Seroprevalence = 35.3%; grade: A
  • Percent Fully Vaccinated = 79.5%; grade: A+
  • Overall Rank = 4; grade: A+

Maryland

  • Case Rate per 100,000 = 17,039; grade: A+
  • Death Rate per 100,000 = 239; grade: B
  • Seroprevalence = 49.9%; grade: A-
  • Percent Fully Vaccinated = 75.6%; grade: A-
  • Overall Rank = 9; grade: A-

Massachusetts

  • Case Rate per 100,000 = 25,387; grade: C
  • Death Rate per 100,000 = 293; grade: B
  • Seroprevalence = 52.6%; grade: B+
  • Percent Fully Vaccinated = 78.9%; grade: A
  • Overall Rank = 15; grade: B+

Michigan

  • Case Rate per 100,000 = 24,291; grade: B-
  • Death Rate per 100,000 = 360; grade: D
  • Seroprevalence = 56.9%; grade: B-
  • Percent Fully Vaccinated = 60.1%; grade: C-
  • Overall Rank = 27; grade: C+

Minnesota

  • Case Rate per 100,000 = 25,692; grade: C
  • Death Rate per 100,000 = 226; grade: B+
  • Seroprevalence = 60.8%; grade: C+
  • Percent Fully Vaccinated = 69.1%; grade: B
  • Overall Rank = 18; grade: B

Mississippi

  • Case Rate per 100,000 = 26,788; grade: D+
  • Death Rate per 100,000 = 417; grade: F
  • Seroprevalence = 69.4%; grade: F
  • Percent Fully Vaccinated = 51.8%; grade: F
  • Overall Rank = 51; grade: F

Missouri

  • Case Rate per 100,000 = 23,156; grade: B+
  • Death Rate per 100,000 = 330; grade: C
  • Seroprevalence = 55.7%; grade: B-
  • Percent Fully Vaccinated = 56.0%; grade: D
  • Overall Rank = 17; grade: B

Montana

  • Case Rate per 100,000 = 25,617; grade: C
  • Death Rate per 100,000 = 313; grade: C+
  • Seroprevalence = 47.5%; grade: A-
  • Percent Fully Vaccinated = 56.7%; grade: D+
  • Overall Rank = 19; grade: B

Nebraska

  • Case Rate per 100,000 = 24,798; grade: B-
  • Death Rate per 100,000 = 216; grade: A-
  • Seroprevalence = 65.4%; grade: D
  • Percent Fully Vaccinated = 63.6%; grade: C+
  • Overall Rank = 22; grade: B-

Nevada

  • Case Rate per 100,000 = 23,332; grade: B
  • Death Rate per 100,000 = 349; grade: D+
  • Seroprevalence = 60.1%; grade: C+
  • Percent Fully Vaccinated = 60.8%; grade: C-
  • Overall Rank = 25; grade: C+

New Hampshire

  • Case Rate per 100,000 = 22,740; grade: A-
  • Death Rate per 100,000 = 182; grade: A-
  • Seroprevalence = 33.1%; grade: A+
  • Percent Fully Vaccinated = 70.2%; grade: B+
  • Overall Rank = 6; grade: A

New Jersey

  • Case Rate per 100,000 = 25,355; grade: C+
  • Death Rate per 100,000 = 376; grade: D-
  • Seroprevalence = 60.9%; grade: C+
  • Percent Fully Vaccinated = 75.6%; grade: A-
  • Overall Rank = 33; grade: C-

New Mexico

  • Case Rate per 100,000 = 24,886; grade: B-
  • Death Rate per 100,000 = 356; grade: D
  • Seroprevalence = 49.1%; grade: A-
  • Percent Fully Vaccinated = 71.0%; grade: B+
  • Overall Rank = 21; grade: B-

New York

  • Case Rate per 100,000 = 26,376; grade: C-
  • Death Rate per 100,000 = 347; grade: D+
  • Seroprevalence = 61.5%; grade: C
  • Percent Fully Vaccinated = 76.9%; grade: A
  • Overall Rank = 36; grade: C-

North Carolina

  • Case Rate per 100,000 = 25,355; grade: C
  • Death Rate per 100,000 = 223; grade: B+
  • Seroprevalence = 52.0%; grade: B+
  • Percent Fully Vaccinated = 61.0%; grade: C-
  • Overall Rank = 14; grade: B+

North Dakota

  • Case Rate per 100,000 = 31,620; grade: F
  • Death Rate per 100,000 = 297; grade: B-
  • Seroprevalence data not available
  • Percent Fully Vaccinated = 54.9%; grade: D
  • Overall Rank = 41; grade: D

Ohio

  • Case Rate per 100,000 = 22,999; grade: B+
  • Death Rate per 100,000 = 328; grade: C
  • Seroprevalence = 63.2%; grade: C-
  • Percent Fully Vaccinated = 58.4%; grade: C-
  • Overall Rank = 24; grade: B-

Oklahoma

  • Case Rate per 100,000 = 26,293; grade: C-
  • Death Rate per 100,000 = 360; grade: D
  • Seroprevalence = 69.1%; grade: D-
  • Percent Fully Vaccinated = 57.2%; grade: D+
  • Overall Rank = 47; grade: D-

Oregon

  • Case Rate per 100,000 = 17,038; grade: A+
  • Death Rate per 100,000 = 177; grade: A
  • Seroprevalence = 46.9%; grade: A
  • Percent Fully Vaccinated = 69.9%; grade: B
  • Overall Rank = 5; grade: A

Pennsylvania

  • Case Rate per 100,000 = 21,973; grade: A-
  • Death Rate per 100,000 = 348; grade: D+
  • Seroprevalence = 54.6%; grade: B
  • Percent Fully Vaccinated = 68.4%; grade: B-
  • Overall Rank = 16; grade: B+

Puerto Rico

  • Case Rate per 100,000 = 16,358; grade: A+
  • Death Rate per 100,000 = 131; grade: A+
  • Seroprevalence = 34.3%; grade: A+
  • Percent Fully Vaccinated = 83.0%; grade: A+
  • Overall Rank = 1; grade: A+

Rhode Island

  • Case Rate per 100,000 = 33,226; grade: F
  • Death Rate per 100,000 = 333; grade: C-
  • Seroprevalence = 53.4%; grade: B+
  • Percent Fully Vaccinated = 82.5%; grade: A+
  • Overall Rank = 30; grade: C

South Carolina

  • Case Rate per 100,000 = 28,592; grade: D-
  • Death Rate per 100,000 = 344; grade: C-
  • Seroprevalence = 64.5%; grade: D+
  • Percent Fully Vaccinated = 56.6%; grade: D
  • Overall Rank = 46; grade: D-

South Dakota

  • Case Rate per 100,000 = 26,882; grade: D+
  • Death Rate per 100,000 = 329; grade: C
  • Seroprevalence = 61.3%; grade: C
  • Percent Fully Vaccinated = 61.4%; grade: C
  • Overall Rank = 38; grade: D+

Tennessee

  • Case Rate per 100,000 = 29,715; grade: F
  • Death Rate per 100,000 = 382; grade: F
  • Seroprevalence = 67.4%; grade: D
  • Percent Fully Vaccinated = 54.5%; grade: D-
  • Overall Rank = 52; grade: F

Texas

  • Case Rate per 100,000 = 23,215; grade: B+
  • Death Rate per 100,000 = 298; grade: B-
  • Seroprevalence = 69.7%; grade: F
  • Percent Fully Vaccinated = 61.4%; grade: C
  • Overall Rank = 28; grade: C+

Utah

  • Case Rate per 100,000 = 29,026; grade: D-
  • Death Rate per 100,000 = 147; grade: A+
  • Seroprevalence = 69.2%; grade: D-
  • Percent Fully Vaccinated = 64.3%; grade: C+
  • Overall Rank = 34; grade: C-

Vermont

  • Case Rate per 100,000 = 18,336; grade: A
  • Death Rate per 100,000 = 96; grade: A+
  • Seroprevalence = 28.9%; grade: A+
  • Percent Fully Vaccinated = 81.1%; grade: A+
  • Overall Rank = 2; grade: A+

Virginia

  • Case Rate per 100,000 = 19,912; grade: A
  • Death Rate per 100,000 = 236; grade: B+
  • Seroprevalence = 45.1%; grade: A
  • Percent Fully Vaccinated = 73.1%; grade: A-
  • Overall Rank = 8; grade: A

Washington State

  • Case Rate per 100,000 = 19,609; grade: A
  • Death Rate per 100,000 = 166; grade: A
  • Seroprevalence = 54.3%; grade: B
  • Percent Fully Vaccinated = 72.5%; grade: B+
  • Overall Rank = 7; grade: A

West Virginia

  • Case Rate per 100,000 = 27,938; grade: D-
  • Death Rate per 100,000 = 382; grade: D-
  • Seroprevalence = 54.6%; grade: B
  • Percent Fully Vaccinated = 57.6%; grade: D+
  • Overall Rank = 44; grade: D

Wisconsin

  • Case Rate per 100,000 = 27,604; grade: D
  • Death Rate per 100,000 = 247; grade: B
  • Seroprevalence = 66.7%; grade: D
  • Percent Fully Vaccinated = 65.5%; grade: B-
  • Overall Rank = 40; grade: D+

Wyoming

  • Case Rate per 100,000 = 27,049; grade: D+
  • Death Rate per 100,000 = 313; grade: C
  • Seroprevalence = 62.5%; grade: C-
  • Percent Fully Vaccinated = 51.6%; grade: F
  • Overall Rank = 43; grade: D

The data indicates that during the pandemic, you were best off living on an island (Puerto Rico or Hawaii). If you couldn’t live on an island, then you were best off living in either Vermont or Maine. The states that were the worst to live in during the pandemic were Tennessee, Mississippi, Arkansas, and Alabama.

But the pandemic is not yet over. Today’s epidemiologic data from the CDC shows that we are likely entering a new COVID -19 surge. Since the beginning of the pandemic, we have seen that the percent test positivity starts going up about 2 weeks before the case numbers rise followed a few days later by a rise in hospitalization rates and then about 2 weeks later by a rise in death rates. The graph below shows that the test percent positivity (yellow curve) began to increase on March 19, 2022 and the case numbers then began to increase on April 5, 2022.

The number of COVID-19 hospitalizations (yellow curve in the graph below) then began to rise on April 7, 2022:

The daily death rate began rising on April 27, 2022 (not shown). With a recent societal move toward elimination of masking and social distancing, the number of cases, hospitalizations, and deaths will likely continue to rise in the coming weeks. So, there is still a chance for states to pull up their grades. But given the geographic variation in cultural attitudes toward infection control, I don’t expect this to happen.

April 29, 2022

Categories
Medical Economics

Will Inflation Eliminate Private Medical Practices?

When the inflation rate rises, different professions are affected differently. One of the most vulnerable is the private practice physician and the recent rise in inflation may just be enough to close many private practices and force those physicians to become hospital-employed.

In a previous post in 2019, I laid out the argument that all physicians should be afraid of inflation. At that time, inflation was just a hypothetical possibility – something that would likely happen at some time in the remote future. But now, inflation is a reality and it is causing financial pressures on physician practices.

Inflation results when there is an increase in the cost of goods. Some inflation is good and is a sign of strong consumer demand, growing worker income, and low unemployment rates. The ideal inflation rate is around 2% per year. But when the inflation rate is too high, consumers cannot afford to purchase the same amount of goods and services. As a result, in a free market, workers will demand higher wages in order to maintain a constant purchasing power. However, people on fixed incomes lose their purchasing power since their incomes cannot keep pace with inflation. Although retirees are the group of people who are most often mentioned as being harmed by high inflation, physicians in private practice are also essentially on fixed incomes.

Physician reimbursement is not a free market system. When inflation affects a restaurant, a grocery, or a retail store, that business can increase prices overnight in order to keep up with expenses. However, physicians cannot increase the amount that they get paid. Physician income from professional fees primarily comes from two sources: the government (through Medicare and Medicaid) and commercial health insurance companies. The U.S. Congress sets Medicare payments each year for every physician service. Commercial insurance companies negotiate contracts with physicians that typically set the fees for several years in the future. Most physicians will have a “fee schedule” that allows them to change their charged amount for any given service. The charged amount on the fee schedule for any given service is set at an price higher than their highest paying commercial insurance contract. However, for all practical purposes, no one pays the amount of the fee schedule since it only applies to uninsured patients and most of the uninsured negotiate reduced amounts on an individual basis because of financial hardship.

Medicare payments do not keep up with inflation

The amount that Medicare pays a physician for a given service or procedure depends on two things: (1) the Medicare conversion factor and (2) the Medicare RVU schedule. The conversion factor is the amount that Medicare pays a physician for each RVU. The RVU schedule is how many RVUs Medicare assigns to each physician service or procedure. Every November, Congress sets the conversion factor for the upcoming year and over the past 20 years, it has been essentially flat.

In 1998, the Medicare conversion factor was $36.69 per RVU and in 2022, the current conversion factor is $34.61. In other words, the conversion factor is 2 dollars less today than it was 24 year ago! However, the inflation rate has resulted in us now needing $67.22 in 2022 in order to purchase $36.69 worth of goods & services in 1998. The net effect is that in terms of purchasing power, 1 RVU is worth half as much today as it was in 1998.

The Medicare RVU schedule varies from year to year depending on what types of services Medicare wants to promote. Over the past two decades, Medicare has been tending toward emphasizing primary care and de-emphasizing procedure-based specialties. Therefore, Medicare has increased the RVUs for outpatient office visits and reduced the RVUs for procedures. However, neither office visit nor procedure reimbursement has kept up with inflation. The graph below compares the reimbursement for a level 4 new outpatient visit (CPT 99204) in Ohio from 2000 to 2022 compared to the effect of inflation during this same time period. During this time, a new outpatient visit lost 25% of its value due to inflation:

In order to increase the RVUs for outpatient visits, Medicare had to take those RVUs from other service and consequently, procedure reimbursement has lost even more value. Two common procedures performed by outpatient physicians are knee injections (CPT 20610) and EKGs (CPT 93000). Between 2000 and 2022, reimbursement for performing knee injection fell from $70.53 to $63.79. When adjusted for inflation, this represents a 49% loss of value.

EKGs lost even more value. Between 2000 and 2022, reimbursement for performing an EKG with interpretation fell from $27.63 to $13.91. When adjusted for inflation, this represents a 72% loss of value.

…and office expenses keep rising

At the same time that inflation has eroded the value of Medicare reimbursement, physician practice overhead expenses keep going up. Doctors have to pay more for office rent, utilities, and office staff salaries due to inflation. As a consequence, what many physicians take home at the end of the day in income for performing outpatient services has fallen.

As an example, in 2005, the average rent in the U.S. was $12.12 per square foot. By 2020, the average rent increased to $19.27 per square foot. In 2000, the average LPN annual income was $29,100 and by 2021, it had risen to $48,070. In 2000, the average RN annual income was $43,900 and by 2021, it had risen to $77,600.

So, what can the private practice physician do?

With inflation accelerating overhead expenses and with Medicare payments not keeping up with inflation, there are only a limited number of options for the private practice physician who depends on receipts from clinical practice to stay in business.

  1. Retire. For many older physicians, this is the most appealing option. However, that assumes that they have been able to save up enough in their retirement portfolio. Over the past several years, many physicians reduced their annual retirement saving contributions in order to pay their mounting office expenses in the setting of reduced or unchanged Medicare payments.
  2. Stop accepting uninsured patients. Currently 8.6% of Americans lack any form of health insurance. Most of these people are either unemployed or work in low-income jobs that do not provide health insurance. Many private practice physicians require payment in advance for patients without health insurance who seek healthcare and most of these patients do not have the money to pay for physician services.
  3. Stop accepting Medicaid and Medicare. Physicians can usually negotiate higher rates from commercial insurance companies than they get from Medicare. In theory, these negotiations could result in reimbursement that could keep up with inflation. However, given the large percentage of Americans who are covered by either Medicare (18.4%) or Medicaid (17.8%), this is impractical for most physicians, particularly older primary care physicians whose patient panels have aged as the physicians have aged. Currently, 15% of physicians do not accept new Medicare patients and 1% of non-pediatric physicians do not accept any Medicare patients (nearly half of the latter physicians are psychiatrists). Medicaid pays physicians even less than Medicare and currently, 29% of physicians do not accept new Medicaid patients.
  4. Concierge medicine. Concierge physicians charge patients a monthly or annual retainer fee in exchange for enhanced care such as immediate availability to office appointments and longer office visit times.. These physicians will typically have much smaller patient panel sizes than other primary care physicians – by some estimates approximately 1/7th the size. Because these fees are charged directly to the patient, most patients contracting with a concierge physicians are wealthy.
  5. Increase patient volumes. In medical practices, there is little room for increased production. There is a limit to the number of patients that a physician can safely see per hour and the prospect of working more hours per week is unpalatable given that the average physician already works an average of 52 hours per week. Although there can be some improvement in operational efficiency by optimizing patient throughput and improving electronic medical record utilization, most private medical practices have already instituted these measures.
  6. Join the Veteran’s Administration. The VA is attractive to many physicians in private practice, particularly older physicians. For those working in VA outpatient clinics, there is generally no weekends, no night call, and no overhead expense. VA physicians have an average salary of $230,000 per year and after 5 years of employment, are eligible for a retirement pension. As a result, many physicians in private practice can have a higher annual income and better retirement benefits by moving to the VA.
  7. Become hospital-employed. For many physicians in private practice, this is the only realistic option. Currently, 70% of physicians are employed by hospitals or corporate entities and the overwhelming majority of new physicians completing their training become employed by hospitals rather than enter private practice. The Stark law prevents hospitals from subsidizing private practice physician salaries. However, hospitals can subsidize salaries of those physicians who are employed by the hospital.

2022 is a very bad year for physicians in private practice

Over the past 2 years, the Medicare conversion rate fell from $36.09 per RVU for 2020 to $34.61 for 2022. In March 2022, the annual inflation rate reached 8.5%, the highest rate in 40 years. For many physicians in private practice who were barely getting by a year ago, this surge in the inflation rate combined with a reduction in this year’s Medicare conversion rate will be too much to financially bear.

In a free market economy, quality is the most important determinate of cost – the best chef commands the highest wage and the best architect commands the highest fee. Since the creation of Medicare in 1965, physician practices become less and less susceptible to free market forces. The inexperienced physician and the physician with 30 years of experience get paid exactly the same by Medicare. Similarly, the worst physician in the community gets paid by Medicare the same as the best physician. The recent increase in inflation will likely force many physicians away from private practice employment models and move medicine even further from a free market workforce. We are spectators to the extinction of the private medical practice.

April 18, 2022

Categories
Medical Education

The Last Webcast

After 860 shows, I filmed my last continuing medical education webcast 2 weeks ago and today, it is being released on the internet. In 1998, I took over as moderator and editor of the weekly Ohio Medical Education Network TV series (OMEN-TV) that later became the webcast, OSU MedNet. For 24 years, I have spent every Friday at noon from September through June in a television studio to keep practicing physicians up to date on the newest developments in medicine. Today, I am now officially retired from the Ohio State University.

The third pillar of medical education

MedNet is devoted to continuing medical education (CME). There are three components to medical education: medical student education, graduate medical education, and continuing medical education. Medical student education is based in our nation’s medical schools where medical students receive 4 years of classroom and clinical education in order to receive their MD or DO degrees. Graduate medical education (GME) is based in our nation’s hospitals where graduates of medical schools spend 3-5 years training as residents and then may spend an additional 1-4 years training as subspecialty fellows. Continuing medical education is for physicians who have finished residency and fellowship training and are now out in clinical practice.

CME is the least lauded of these three pillars of medical education. Medical student education is the realm of university professors and deans whose salaries come from tuition, endowments, and state government support. GME is the realm of clinician educators, department chairs, and division directors whose teaching income comes from Medicare education support and clinical revenue. Success in both medical student education and GME can be a foundation for academic physician career development and university promotion. On the other hand, CME often lacks the glamour of medical student and resident education. Success in CME rarely leads to university promotion and most CME educators do it voluntarily, without pay.

Where do doctors get CME?

In order to maintain their medical licenses, doctors are required to have a certain number of continuing medical education hours every year. The specific requirements vary from state to state; here in Ohio, the State Medical Board requires physicians to have 50 hours of CME every two years. In the past, most physicians would get their CME from a combination of hospital grand rounds and medical conferences. Hospital grand rounds are free and the attendees are mostly physicians who practice at that particular hospital. Large hospitals can recruit grand rounds speakers from their own medical staff who present their grand rounds lectures without getting paid; delivering a grand rounds lecture is considered part of one’s normal professional obligations. Smaller hospitals generally have to bring in outside grand rounds speakers who get paid an honorarium fee. Weekly outside speakers can be very expensive for hospitals and for many smaller hospitals, can be cost-prohibitive.

There are two main types of medical conferences: those sponsored by hospitals and those sponsored by national specialty societies. Hospital-sponsored conferences are usually 1-day events that attract local or regional physicians and consist of several lectures on a particular topic, for example diabetes or heart disease. Specialty society-sponsored conferences are held once a year in a convention center and features dozens of lectures over several days that attendees can choose from. Conferences are very expensive to put on and the money to fund conferences comes from a combination of meeting registration fees and educational grants from pharmaceutical and medical devices companies. Like hospital grand rounds speakers, the educators at conferences generally do not get paid for delivering their lectures but sometimes have their meeting registration fees waived in exchange for their presentations.

A different way of doing CME

The Ohio State University was originally established as a land grant college. The land grant concept was created by the Morrill Act signed by Abraham Lincoln in 1862 that allowed the U.S. government to grant some colleges federal land to build on and in exchange, those colleges would focus on science, agriculture, and engineering (in contrast to private colleges that were largely based on liberal arts). Every state in the U.S. has at least one land grant college. One of the provisions of the Morrill Act was that land grant colleges also had to serve as a community resource for agriculture and science. This was the origin of agricultural extension offices that are still in use today.

In 1962, as part of its land grant mission, the Ohio State University created a medical education outreach program that had a lot of similarities to the agricultural extension offices. The program was called OMEN which stood for the Ohio Medical Education Network. It was broadcast at noon from an audio studio set up in Starling Loving Hall on the OSU Medical Center campus. Participating hospitals would be pre-mailed 35 mm Kodachrome slide sets and then OSU medical school faculty would broadcast their lectures over a telephone speaker system with “beeps” indicating when to advance the slides. After each formal presentation, the listeners could call in to get advice from the OSU specialists on the management of their own patients. Initially, most of the participating hospitals were smaller, often rural hospitals in Ohio. Over time, hospitals in other states and many VA hospitals were added. Sixty years ago, this was a revolutionary, state-of-the-art concept in distance education that for the first time, allowed physicians practicing in smaller communities to keep up with breakthroughs in disease diagnosis and treatment.

In 1990, OMEN expanded from the audio program using slide sets into a satellite TV program and was re-named OMEN-TV. The participating hospitals would use a satellite dish to receive the programs and they were filmed in a TV studio in Atwell Hall on the OSU Medical Center campus. The shows were live presentations and satellite time was rented from noon to 1:00 PM every Friday from September through June (mirroring the university’s academic year). The TV program had the advantage that now the audience could see the presenters and we could incorporate video, for example, of a surgical procedure. At the end of each show, viewers could call in and ask questions live on-air. In the early years of OMEN-TV, I was a frequent guest presenter, lecturing on various pulmonary and critical care topics. Then, in 1998, I took over as the moderator and medical editor of OMEN-TV.

Like its audio predecessor, OMEN-TV was a ground-breaking concept for continuing medical education. Initially, there was nothing else like it in the United States. Subscribing hospitals would pay a small annual subscription fee to the OSU College of Medicine and in return, they would get weekly medical education shows that allowed their doctors to get CME credits without having to leave to attend an out-of-town conference. It was also far less costly to the hospitals than bringing in outside grand rounds speakers every week. The downside was that if doctors were in the operating room or attending to sick patients at the time of the broadcast, they would miss the presentation. We did additionally replay the shows on cable TV but it was generally a public access channel and often shown at an inconvenient time of the day or night. The number of subscribing hospitals grew with more VA hospitals and community hospitals throughout the country added every year.

OMEN-TV was costly to produce. The live TV show required 3 cameramen, a sound technician, someone to hold cue cards (and later to run a teleprompter), staff to take viewer phone calls, a film director, computer technicians, a make-up artist, and a full-time producer. The subscription fees only covered a small part of the total production costs so additional financial support came from the OSU Medical Center. But even that was not enough to fully fund the program. So, we would reach out to pharmaceutical companies and educational foundations to get unrestricted educational grants. We would acknowledge these organizations in the credits at the beginning of each show, similar to what you see with PBS broadcasts. The hospital paid 10% of my salary to be the moderator and editor of OMEN-TV. Each show required about 8 hours of my time to recruit presenters, review and edit slides before broadcast, prep the presenters, rehearse, host the live show, and fill out all of the CME paperwork after each show. Each season initially consisted of 28 shows per year and we quickly expanded to 40 per year – every Friday from September through June with weeks off for major holidays. I was the sole host and the only times I could take vacations were July, August, and the weeks of Thanksgiving, Christmas, or New Years Day. Fortunately, I was able to avoid any major illnesses or injuries that would have kept me out of the studio.

But OMEN-TV had its downsides. Since it was a live broadcast, subscribing hospitals were limited to showing the program at noon on Fridays. We did not have a good way to reach physicians who were not on the medical staff of a subscribing hospital. Also, in the early 2000’s, there was mounting pressure from the Accreditation Council for Continuing Medical Education (ACCME) to eliminate educational grants from pharmaceutical companies in order to reduce the risk of conflict of interest affecting presentations. OMEN-TV needed to evolve once again into a leaner, more widely available program.

In 2002, OMEN-TV transformed from a satellite TV show into a webcast. In order to better reflect the internet medium of broadcast, the program was re-named OSU MedNet-21 (medical education for the 21st century). We retained most of the elements of the OMEN-TV production but now subscribing hospitals could show MedNet on any day and time that best fit with the hospitals’ medical staff calendars. Also, by being a video-on-demand product, we could keep the shows available on the internet for 3 years. So, at any given time, we had 120 hours of CME available on the OSU Center for Continuing Medical Education’s website. We made the webcasts available for free for anyone to view – no user account or password needed. The only requirement was that physicians who wanted to get CME credit for viewing the webcasts had to either view them at a subscribing hospital or had to pay a small fee after viewing the webcasts in order to take a 10-question CME post-test. The webcast format allowed us to track viewer numbers – we could not identify individual viewers but we could tell what country they were viewing from. We have had physician viewers from 136 countries watch MedNet webcasts. Soon after converting to a webcast, we moved production to the WOSU-TV studios on the university campus.

 

As a webcast, we were able to significantly reduce our production costs. In the WOSU-TV studio, we used 3 remotely operated digital cameras, eliminating the need for individual cameramen. We stopped using a make-up artist and since the webcasts were not shown live, we no longer needed people to operate phones. Instead of a massive studio crew, we were able to film each webcast using just 4 people in a separate control room to operate cameras, do audio, operate the teleprompter, and do the computer integration. With with reduction in production costs, we no longer needed grants from pharmaceutical companies and we were able to fully finance the program with subscription fees and support from the OSU Medical Center and the OSU James Cancer Hospital. Each webcast is also available as an audio-only podcast, allowing physicians to get their CME by podcast during their commute to and from work.

Meeting physician educational needs

Today, OSU MedNet goes out to 70 hospitals nationwide, with the largest number of subscribing hospitals here in Ohio. Because most of these hospitals are smaller community hospitals, most of the viewers are primary care physicians: family medicine, general internal medicine, pediatrics, and hospitalists. Each year, we do a needs assessment by soliciting topic recommendations from our viewers. We also ask the OSU department chairs, division directors, deans, and medical directors for topic suggestions. I would go through the last year’s editions of the New England Journal of Medicine, JAMA, and the Morbidity and Mortality Weekly Report from the CDC. From this, we had about 2-300 possible topics. We then use a group of OSU primary care physicians to rank the topics and the highest ranked topics become the next season’s shows. I then identify and recruit physicians from the Ohio State University to present each of those topics. For most of these presenters, it is the largest audience that they will ever have, reaching hundreds of physicians all over the world and impacting thousands of patients’ lives.

As a webcast, MedNet has the flexibility to do additional shows on short notice when new developments in medicine occur. So, for example, we were able to do webcasts on SARS, Ebola, and Zika virus within 2 weeks of the initial cases of these infections. When COVID-19 first developed in January 2020, we were able to put out a COVID-19 MedNet on February 3, 2020, just two weeks after the first reported case in the U.S. and before Ohio had any cases. Since the pandemic began, we have done 9 COVID webcasts as new developments in the diagnosis, treatment, and prevention arose. When case rates began to rise last winter due to the Omicron variant, we were able to get a COVID update on the internet within 5 days of concept inception in order to help physicians manage the surging number of cases in their own communities.

The last webcast

In April 2021, I retired from the Ohio State University and from clinical practice. I was at OSU for 43 years as a research lab assistant, medical student, resident, fellow, and professor. However, after retiring, I agreed to continue as the moderator and host of OSU MedNet until my successor was named. So, for the past year, I’ve continued to host the webcasts every Friday. I’ve done it as a volunteer, without compensation, because I’m very passionate about the program and about the need to continue to provide quality continuing medical education to physicians around the world. Besides, I have a lot of fun hosting the show and it has kept me engaged with the OSU medical community as a way of easing into retirement.

For two years, we recorded MedNet by Zoom from our office computers rather than using the WOSU-TV studios because of the COVID-19 pandemic. In March 2022, the case numbers had fallen low enough to permit us to take off our face masks and return to the studio safely. During the pandemic, construction did not stop on the new WOSU Media Building and last month, we filmed our first webcast in the new WOSU-TV studio. It is a truly state of the art facility with superior cameras, sound, and lighting.

It took nearly a year to solicit applications for the next MedNet moderator and then to select finalists, do auditions, and do the final selection. I am absolutely delighted that Dr. Shengyi (“Jing-Jing”) Mao will be taking over as my successor. She is an OSU primary care physician who is board certified in both internal medicine and pediatrics and has been a regular MedNet presenter in the past few years.

Today, we are releasing my last official webcast as moderator and host of OSU MedNet and next week, Jing-Jing will take over in the studio. I’ll be back occasionally to fill in when needed but for the first time in 24 years, my Fridays will be open and I’ll be free to travel outside of Columbus whenever I want. For my last show, I decided to be both the moderator and the guest and so I hosted my own presentation. I decided to talk about Physician Financial Health. For 15 years, I served as the treasurer and vice chair of the OSU Department of Internal Medicine and part of my responsibilities was to advise new faculty about retirement plan options, personal finances, and saving for children’ college education. That expanded to annual talks to the residents and the fellows about financial planning and has resulted in a number of posts on this blog about physician finances and about retirement planning. So, as a recent retiree, I decided that financial health would be a fitting topic for my last webcast. You can view the webcast by clicking here.

After 810 shows, I’ve learned a lot about areas of medicine that as a pulmonary and critical care physician, I never would have otherwise have learned about. I’ve met fascinating people who were our guests – both doctors and other healthcare professionals. I’ve also learned a lot about TV and webcast production. But most of all, I’ve had fun doing it… a lot of fun. And now, it’s time to become a MedNet viewer, rather than the MedNet moderator.

 

 

April 8, 2022

Categories
Epidemiology

How Do We Overcome Vaccination Hesitancy?

Today, I got my second COVID-19 booster. On December 15, 2020, I was one of the first healthcare workers in the United States to get the newly approved Pfizer vaccine. In the nearly 16 months since then, I’ve had a total of 4 COVID vaccinations, 2 shingles vaccinations, and an influenza vaccination. I’m alive, I’m healthy, and I want to stay that way.

But in my home of Franklin County, Ohio, only 74% of adults are fully vaccinated with the initial doses of COVID vaccines and only 41% of adults are both fully vaccinated and received a booster. Franklin County’s vaccination numbers are only slightly worse than the United States as a whole. We are now approaching 1 million American deaths from COVID-19. More than a third of those have occurred since vaccines were available to all adults making most of these deaths preventable. So, why aren’t Americans getting vaccinated?

Vaccine hesitancy is the intersection of ignorance, cowardice, obstinance, and selfishness. Most people who unvaccinated fall into one or more of these categories. Improving vaccination rates requires different tactics for each of these groups of people.

The four causes of vaccine hesitancy

Ignorance. Ignorance about disease and about vaccines is hard to break. Nevertheless, it is probably the easiest of the four barriers to vaccination to overcome. The ally of ignorance is misinformation. A famous adage (incorrectly attributed to Mark Twain) states: “A lie can travel halfway around the world before the truth is putting on its shoes“. I the era of the internet, cable news, and social media, a better adage is: “A lie can travel around the world ten times before truth gets out of bed in the morning“. A subset of the ignorant is the skeptics who can be educated but will only accept education from members of their own kind. An OSU Buckeye fan will won’t be convinced by a Michigan Wolverine fan but might be convinced by a fellow Buckeye. Science is hard to understand and misinformation is a lot easier to understand. Education about vaccines needs to start in middle school science classes, continue in high school health classes, and continue further in physician offices.

Cowardice. Fear is amplified by ignorance. Like ignorance, misinformation is the ally of fear. Some people fear the metal needle, others fear the stuff that is in the syringe, and others just fear science in general. The great facilitator of fear is gossip. When one person tells another that he got a COVID vaccination and his arm was sore for a day, that story gets told to another person who tells another person, and on and on. By the time the tenth person tells the story, the report is that the vaccination caused the guy so much pain that he passed out, had a heart attack, and became impotent. Although education can help overcome cowardice, reassurance is more powerful, particularly when it comes from people you trust like pastors, sports figures, and movie stars. Once again, tribalism plays a role in reassurance. A Republican who won’t accept any reassurance from a Democrat might listen to a fellow Republican.

Obstinance. Some people are impossibly stubborn and no amount of education or reassurance will change their mind. Obstinance is the realm of the hard-core anti-vaxxers. At one extreme are those people who crave the attention they get by being anti-vaxxers or make money by being anti-vaxxers. This kind of secondary gain is nothing new and was the main motivation of snake oil salesmen, purveyors of patent medicines, and ponzi schemers. Robert F. Kennedy, Jr. and Dr. Sheri Tenpenny are examples of people who make a living by being anti-vaxxers. At the other extreme are those people who just can’t admit that they are wrong about anything and will dig their heels in deeper to try to convince themselves that they were right all along. Some obstinate people look for reasons to justify their decisions. For centuries, obstinate people have used their personal interpretation of 2,000 year old passages from the Torah, the Bible, and the Quran to justify a whole variety of hatreds, unhealthy behaviors, social deviance, and crimes. During the COVID pandemic, obstinate people used similar interpretations to claim religious exemptions from vaccination. Obstinance is hard to overcome and sometimes the only tactic that works is public shame.

Selfishness. People who do not get vaccinated because of selfishness often know that vaccines work. They just figure that if everyone else gets vaccinated then the disease will go away and they won’t need a vaccine. The best friend of selfishness is cowardice and the two often go hand-in-hand. Overcoming selfishness often requires a combination of reassurance and shame. However, unlike obstinance, selfishness can sometimes be overcome by private shame rather than public shame.

How do we fix it?

As healthcare workers, our main tools are education and reassurance. As such, we can have the biggest impact on those who are hesitant to get vaccinated because of ignorance and cowardice. It is tempting to use shame but shame is no more useful in changing ignorance than education is in changing obstinance. The trick is to know one’s audience – we should focus on people who are hesitant to get vaccinated because of ignorance or fear. Wasting time and emotional energy on those whose vaccine hesitancy is motivated by obstinance or selfishness is unproductive, frustrating, and exhausting.

COVID-19 is not the first deadly pandemic that the human race has faced and it certainly will not be the last. But we can learn from our public health failures in vaccination and use that knowledge to lay the foundation for more effective public health measures when the next pandemic comes around. The adults when the next pandemic occurs are the children of today. Our focus needs to be on education and reassurance of our children so that ignorance, cowardice, obstinance, and selfishness does not kill them when they are adults.

This pandemic appears to be waning and there are signs that life may be getting back towards normal. For all of the unvaccinated people who are happy to now be taking off their masks and going to restaurants, you can thank everyone who got a vaccination and made it possible.

…you’re welcome.

April 2, 2022

Categories
Physician Retirement Planning

403(b) Or Roth 403(b) – Which Is Better?

Recently, a physician asked me whether it is better to put retirement savings in a regular 403(b) or a Roth 403(b). My answer was… do both. The strongest retirement portfolios are diversified portfolios that allow you to strategically withdraw from different retirement “buckets” in different years in order to keep taxes as low as possible. This means having both Roth and non-Roth deferred income accounts.

What is a Roth 403(b)?

A regular 403(b) is a deferred income retirement account that you pay local income tax, Medicare tax, and Social Security tax the year that you earn the money but you do not pay federal income tax or state income tax until the year that you take the money out in retirement. With a Roth 403(b), you pay federal and state income tax the year you earn the money and then you pay no income taxes the year that you take the money out in retirement. In other words, with a Roth 403(b), you pay income taxes now and with a regular 403(b), you pay income taxes later, when you are retired.

The 403(b) is a deferred income savings program used by non-profit organizations. Similar deferred income retirement savings programs include the 401(k) which is used by for-profit companies, the 457 which is used by government institutions, and the IRA which is used by anyone with a taxable income. Each of these deferred income programs can be offered as either a regular 401(k)/403(b)/457 or as a Roth 401(k)/403(b)/457. Some employers will offer both a Roth and regular option and other employers will only offer a regular 401(k)/403(b)/457.

This post will address what you should do if your employer offers both a regular 401(k)/403(b)/457 and a Roth 401(k)/403(b)/457 as well as the factors that affect your choice of one versus the other. Although I will be discussing the Roth 403(b), the information is also applicable to the Roth 401(k) and Roth 457.

What is the difference between a Roth IRA and a Roth 403(b)?

Most people are familiar with the Roth IRA and as I’ve posted before, I think everyone should have a Roth IRA as part of a diversified retirement portfolio. If your income is too high to contribute directly to a Roth IRA, then you can do a “backdoor Roth IRA” by first contributing post-tax dollars into a traditional IRA and then promptly converting that traditional IRA into a Roth IRA.  The Roth IRA and the Roth 403(b) are similar in that with both, you pay income taxes now and then the distributions are tax-are in retirement. However, there are some important differences between them:

  • Contribution limits. In 2022, the contribution limit for a Roth IRA is $6,000 ($7,000 if over age 50). The contribution limit for a Roth 403(b) is $20,500 ($27,000 if over age 50).
  • Investment options. With a Roth 403(b) account, you can only put money in specific investment options chosen by your employer. These are typically mutual funds or annuities offered by 403(b) administrators such as TIAA or Fidelity. With a Roth IRA, you can put the money in a much wider variety of investments, chosen by you.
  • Employer matching. Some employers will match a portion of your contributions to a 403(b). This is more common with 401(k)s than 403(b)s and rarely if ever found with 457s. These matching contributions are free money that you should never turn down. There is no matching contribution options to a Roth IRA.
  • Early retirement. If you retire before age 59 1/2, you cannot take money out of your Roth IRA without incurring a large tax penalty. However, you can withdraw money from a Roth 403(b) before age 59 1/2 without a penalty if you separated from your employer before age 55.
  • Required minimum distributions. The IRS requires you to take a minimum amount out of Roth 403(b) accounts starting at age 72 years old.  Roth 401(k) and Roth 457 accounts are also subject to these required minimum distributions. Unlike Roth 403(b)s, Roth IRAs are not subject to required minimum distributions.

It’s all about tax rates

The main determinate of whether to contribute to a regular 403(b) or a Roth 403(b) is whether your income tax rate will be higher or lower when you are retired than your income tax rate today.

If your taxes are higher today than they will be in retirement, then you should contribute to a regular 403(b). If your taxes are lower today than they will be in retirement, then you should contribute to a Roth 403(b). If your taxes are the same today as they will be in retirement, then there is no difference between contributing to a regular 403(b) or a Roth 403(b). The problem is knowing if your taxes today will be higher or lower than your taxes in retirement. There are three factors that will influence this.

  1. Tax brackets. In a previous post, I showed how everyone pays an effective federal income tax rate that is less than the income tax bracket that they are in. However, the federal income tax brackets do determine your effective income tax rates. Congress changes the tax brackets and therefore the effective tax rates every few years and it is impossible to predict what those tax brackets will be in your retirement years. Currently, Americans have been enjoying relatively low federal income taxes since the 2017 tax cuts making this a good time to contribute to Roth accounts. However, these tax cuts are set to expire in 2025 and then federal income tax rates will rise back up to 2016 levels (unless congress passes new legislation otherwise) at which time it will be more advantageous to contribute to a regular 403(b). Tax rates will also fluctuate during your retirement years so that there will be some years in retirement that your tax rates will be higher (favoring taking distributions from a Roth 403(b) and some years that your tax rates will be lower (favoring taking distributions from a regular 403(b).
  2. Income level. Most people start off their career with lower incomes and their income gradually increases as they get promotions and greater experience on the job. As income goes up, tax rates also go ups. Therefore, it is generally favorable to contribute to a Roth 403(b) early in your career, when your tax rates are lower. It is generally favorable to contribute to a regular 403(b) later in your career, when your tax rates are higher. In addition, there will be some years during your career that your income will be lower for a variety of reasons: going part-time, being laid off, not getting an annual bonus, etc. In these years, it is more favorable to contribute to a Roth 403(b).
  3. Retirement spending. The amount of money that you withdraw from your retirement savings will vary from year to year, depending on your spending. On retirement years that you do a lot of traveling, buy a vacation home, or buy a new car, you will need to take larger distributions from your retirement accounts. These larger distributions mean a higher income in those years and with higher income comes a higher income tax rate. Therefore, in those retirement years that you have a lot of expenses, it is better to take distributions from a Roth 403(b) and in retirement years that you have fewer expenses, it is better to take distributions from a regular 403(b).

Summarizing these factors, we can see that there are times during your career that contributing to a Roth 403(b) is more favorable than contributing to a regular 403(b). Similarly, there are years in your retirement when withdrawing distributions from a Roth 403(b) is more favorable than withdrawing distributions from a regular 403(b):

You should have BOTH a regular 403(b) and a Roth 403(b)

If you have access to a Roth 403(b) (or a Roth 401(k) or a Roth 457), then you should contribute to it in years when congressionally-determined tax rates are low and in years when you have a lower income (such as early in your career). You should contribute to a regular 403(b) in years that income tax rates are high and in years when you have a high income (such as late in your career). This will result in you having both a regular 403(b) and a Roth 403(b) so that when you are retired, you can withdraw distributions from one or the other, depending on whichever is more favorable from a tax standpoint on any given year.

The result of paying less in taxes is that you have more in disposable income. In order to maximize that disposable income in both your working years and your retirement years you need a diversified retirement portfolio. This allows for a tax-advantaged withdrawal strategy of withdrawing from regular deferred income accounts some years and Roth deferred income accounts other years. Thoughtful retirement saving today will pay off in a healthy finances when you use those savings once retired.

March 31, 2022

 

Categories
Academic Medicine Medical Education

Lessons From The 2022 Fellowship Match

This month, the National Resident Matching Program (NRMP) released the results of this year’s match for fellowships that will begin in July 2022. Match day for most subspecialty fellowships was in December 2021 although some subspecialties had their match day earlier in the year. The new report summarizes the results of these match days.

The process for physician training begins with medical school graduates entering a residency in a specific specialty such as internal medicine, pediatrics, obstetrics & gynecology, or surgery. After completing residency, physicians can do further subspecialty training in fellowships. For example, cardiology is a subspecialty of the specialty of internal medicine. Therefore, to become a cardiologist, a physician first completes an internal medicine residency and then completes a cardiology subspecialty fellowship. Some subspecialties have their own subspecialties. For example, a physician completing a cardiology subspecialty fellowship can go on to do an even more specialized subspecialty fellowship in cardiac electrophysiology.

In the match, physicians who are either in their final year of residency or have already completed residency apply to fellowship training programs. The physician applicants then rank the training programs in order of their preference and the fellowship training programs also rank the applicants in their order of preference. The NRMP computers then assign each applicant to a specific training program using an algorithm that matches the applicant’s preferences with the training programs’ preferences. Overall, the process works and ensures that the applicants get into their most preferred training program that will accept them.

Every spring, the NRMP releases an annual report of the data from the match and by examining the data, there is a wealth of conclusions about the current state of the various subspecialties.

More physicians are specializing

From 1995 to 2000, the number of fellowship positions as well as the number of physicians applying to fellowships fell. However, since 2000, there has been a steady increase in both the available fellowship positions as well as the number of applicants for those positions. This year, 13,586 physicians applied for 12,571 fellowship positions. The majority of applicants were U.S. MD degree graduates (7,141), followed by non-U.S. citizen graduates of international medical schools (2,619), U.S. DO degree graduates (1,991), and U.S. citizen graduates of international medical schools (1,791).

The number of fellowship positions has been increasing faster than the number of resident positions. Over the past 2 decades, resident positions have increased by 74% from approximately 20,200 in 2000 to 35,194 in 2021. During that same time period, fellowship positions have increased by 558%, from approximately 1,900 in 2000 to 12,571 in 2022. In other words, resident positions have not quite doubled in the past twenty years whereas fellowship positions have increased by 5.5-fold.

Internal medicine subspecialties account for the largest number of fellowship positions. 49% of the 12,571 fellowship positions were in internal medicine subspecialties, followed by pediatrics (14%), surgery (7%), and radiology (7%). The penetration of subspecialty fellowships varies between different specialties. For example, there were 1,137 resident positions offered in radiology in 2021 (the most recent year resident data is available) and 869 fellowship positions offered in radiology in 2022. Therefore, there were 0.76 radiology fellowship positions for every 1 radiology resident positions. If all resident and fellow positions were filled, then this would imply that 76% of radiology residents go on to do radiology subspecialty fellowships. Similarly, this analysis would estimate that 69% of internal medicine residents do fellowships whereas only 13% of physical medicine & rehabilitation residents do fellowships.

The number of foreign medical school graduate applicants fell

In recent years, the number of all types of applicants for subspecialty fellowships have been increasing. For the 2022 year, the number of non-U.S. citizens graduating from international medical schools (foreign medical graduates) decreased for the first time from 2,332 in 2021 to 2,280 in 2022. All other types of fellowship applicants increased in number in 2022. One of the main reasons for the decrease in foreign medical graduates was the COVID pandemic that resulted in immigration and travel restrictions that prevented many foreign applicants from coming to the U.S. for medical training.

Non-U.S. citizens who graduated from international medical schools make up a minority of physicians who match in most subspecialties. However, in subspecialties that are less popular with U.S. MD degree graduates, foreign medical graduates comprise the largest percentage of matched positions. Four subspecialties had more foreign medical graduates than U.S. MD degree graduates filling fellowship positions: adult endocrinology (40.4%), adult nephrology (35.8%), adult pulmonary (26.1%; note that there are relatively few positions available for adult pulmonary-alone fellowships and most positions are for combined pulmonary & critical care medicine), and medical genetics (52.2%).

U.S. DO degree graduates (osteopathic school graduates) have historically comprised the smallest number of subspecialty fellowship applicants but now exceed the number of applicants who are U.S. citizen graduates of foreign medical schools. Because of the traditional emphasis on musculoskeletal elements of disease and rehabilitation, osteopathic graduates tend to gravitate to certain subspecialties. Those with more than 20% of filled positions going to U.S. DO degree graduates include: pain medicine (21.5%), emergency medicine services (27.2%), global emergency medicine (22.7%), hospice & palliative medicine (20.7%), brain injury medicine (27.3%), spinal cord injury medicine (35.3%), and sports medicine (36.6%).

Highly competitive subspecialties

The more applicants (particularly U.S. MD degree graduates) there are per subspecialty fellowship position is a marker of how competitive that subspecialty is. Those subspecialties with more applicants than available fellowship positions are highly competitive whereas the subspecialties with more fellowship positions than applicants are less competitive. The 2022 NRMP fellowship match report reveals that some subspecialties are for more competitive than others. Overall, the average subspecialty fellowship filled with 51% U.S. MD degree graduates. The results listed below are the subspecialty fellowship positions that filled with more than 70% U.S. MD degree graduates:

  • Obstetrics & Gynecology. Overall, the subspecialties of OB-GYN are the most competitive of all major specialties: complex family planning (100%) filled all available positions with U.S. MD degree graduates followed by gynecologic oncology (94%), reproductive endocrinology (90%), maternal-fetal medicine (88%), pelvic & reconstructive surgery (79%), and minimally invasive gynecologic surgery (73%).
  • Surgery. Highly competitive subspecialties include: pediatric surgery (95%), hand surgery (85%), colon & rectal surgery (80%), and thoracic surgery (71%).
  • Pediatrics. Three of the 17 pediatric subspecialties were highly competitive: adolescent medicine (77%), child abuse (70%), and pediatric hospital medicine (70%).
  • Internal Medicine. Only hematology (85%) was highly competitive. However, relatively few physicians do a hematology-only fellowship (14 positions) and the vast majority do a combined hematology/oncology fellowship (663 positions).
  • Emergency Medicine. Medical toxicology (74%).

A second marker of competitiveness is the percentage of available fellowship positions in each subspecialty that fill with any applicant, including U.S. MD degree graduates, U.S. DO degree graduates, U.S. citizens graduating from international medical schools, and foreign medical graduates. Below are the subspecialties that filled more than 90% of their available fellowship positions:

Unpopular subspecialties

As in past years, some subspecialties are less popular. Those that filled with fewer than 40% U.S. MD degree graduates were mostly subspecialties of internal medicine and pediatrics:

  • Internal Medicine. The least competitive subspecialty was pulmonary disease (16%). However, relatively few physicians do a pulmonary-only fellowship (25 positions) and the vast majority do a combined pulmonary & critical care medicine fellowship (721 positions). Other unpopular subspecialties included nephrology (20%), geriatric medicine (20%), heart failure & heart transplant (27%), endocrinology (32%), infectious disease (38%), interventional pulmonary (38%), and oncology (38%). However, like hematology-only fellowships, there are relatively few positions in oncology-only fellowships (8) and most positions are in combined hematology & oncology (663) which was a considerably more popular subspecialty.
  • Pediatrics. The least popular pediatric subspecialty was infectious disease (20%) followed by developmental & behavioral pediatrics (29%), endocrinology (30%), and nephrology (32%).
  • Physical Medicine & Rehabilitation. Spinal cord injury medicine (32%).

Below are the subspecialties that filled fewer than 90% of there available positions with any applicant including U.S. MD degree graduates, U.S. DO degree graduates, U.S. citizens graduating from international medical schools, and foreign medical graduates:

Nephrology, endocrinology, and infectious disease remain unpopular

In both internal medicine and pediatrics, nephrology, endocrinology, and infectious disease are among the least popular subspecialties. One of the reasons that infectious disease and endocrinology remain unpopular is salary. According to the 2021 Medscape Physician Compensation Survey, the average general internal medicine physician had an income of $248,000 last year. However, despite requiring two additional years of subspecialty fellowship training after internal medicine residency, adult endocrinologists and infectious disease physicians made less than general internists at $245,000 for both subspecialties. It is difficult to justify investing two additional years into training in order to make less money than if you had gone straight into clinical practice after completing residency. A second physician salary survey is done by Doximity. Like the Medscape survey, Doximity also found that endocrinologists and infectious disease specialists have incomes less than general internists. In addition, the Doximity survey reports salaries for pediatric subspecialties and like their adult counterparts, pediatric endocrinologists and pediatric infectious disease specialists have a lower income than general pediatricians.

The Medscape survey also asks physicians if they feel they are adequately compensated – infectious disease physicians and endocrinologists are the least satisfied with their compensation at 44% and 50% of survey respondents satisfied respectively. The salary disparity has been particularly acute for infectious disease physicians who over the past two years of the COVID pandemic have been among the most over-worked physicians of any specialty. In other words, the message that internal medicine and pediatric residents hear is to go into infectious disease is to train longer, work harder, and get paid less.

The reasons for nephrology continuing to be unpopular are less clear. Nephrologists have a higher annual income than general internal medicine physicians with an average of $311,000 per year. However, this is less than other procedural internal medicine subspecialties such as pulmonary medicine, critical care medicine, cardiology, and gastroenterology. One of the primary clinical activities of nephrologists is overseeing dialysis. Most patients with end-stage renal disease receive hemodialysis three days per week, either Monday-Wednesday-Friday or Tuesday-Thursday- Saturday. Because of this schedule, nephrologists typically have a 6-day workweek to cover dialysis with a 1-day weekend (Sunday) whereas other subspecialties typically have a 5-day workweek with a 2-day weekend. It is possible that the longer workweek attendant to nephrology could be discouraging physicians from entering the subspecialty.

Geriatrics continues to be an unpopular subspecialty. Unlike many of the other fellowships, a physician can do either an internal medicine or a family medicine residency prior to a geriatric medicine fellowship. Salary is one of the barriers to applicants. Geriatric medicine requires a 1-year fellowship and most geriatricians practice primary care medicine for people over age 65. There is no additional compensation in terms of RVUs for caring for older patients and many of these patients have multiple concurrent medical problems as well as cognitive impairment. As a result, it can take a geriatrician longer for an outpatient visit while getting paid the same amount that a primary care internist or family physician would be paid for an office visit for a younger, less medically complex patient. Thus, the economics of geriatric medicine discourages family physicians and internists from entering the subspecialty.

So, what does all of this mean?

As fewer physicians go into specific subspecialties, there will likely be shortages of those subspecialists in the future. The pediatric subspecialties of endocrinology, infectious disease, and nephrology had a lowest percentage of available fellowship positions fill and will therefore face physician shortages in the near future. However, I believe that the most serious future shortage will be in adult nephrology. Pediatric subspecialists are relatively small in numbers and almost always located in large referral pediatric hospitals. On the other hand, adult nephrologists are needed in most community hospitals and any town large enough to have an outpatient dialysis center.

The number of unfilled subspecialty fellowship positions is even larger for geriatrics. However, general internal medicine physicians and family physicians can more easily fill in for shortages in geriatricians. Therefore, shortages of physicians trained in geriatrics will not be felt as severely by most communities.

For capitalism to work in medicine, supply and demand have to be unconstrained so that when the supply of a subspecialty falls, demand for that subspecialty can bring the supply back up through free market forces that increase the pay for those subspecialists. The U.S. system for paying physicians has led to an uncoupling of supply and demand. Unless health policy changes the way that subspecialists such as endocrinologists, infectious disease specialists, and nephrologists are compensated, we will be facing an increasing shortage of these physicians in the future. In the meantime, if your hospital has one of these subspecialists who is a high-performer, treat him or her well – they are becoming a very rare breed.

March 30, 2022