Accept Medicare Reimbursement? 3 Reasons It’s a Bad Idea

If you follow the world of health and patient advocacy these days, you can’t miss the many discussions about providing advocacy services through Medicare reimbursement.

Aye-yi-yi!

Not that I’m opinionated on this topic (!) but I’ve been sharing my opinions on the question of Medicare and private insurance reimbursement for advocacy services since the very early days of health advocacy:

• Why I Hope These Pigs Never Fly – and You Should, Too
• Insurance Reimbursements? Not Exactly a Pot of Gold
• Should Insurance Provide Reimbursement to Independent Advocates?

… and others. 

To be clear: It’s my opinion that private advocates who accept insurance or Medicare reimbursement in lieu of direct patient payment may be jeopardizing the work they do on behalf of their clients. In turn, those possible negative outcomes, and the low advocacy income that goes along with reimbursement, will  do damage to their practices – even put them out of business.

Over time, one or both of those outcomes could destroy the entire profession of INDEPENDENT advocacy – which has always been independent, and until now has stayed independent, for just those reasons.

Let’s first look at the detriment to patient-clients:

When you work directly for the client, then the client is in the driver’s seat: At every turn, you are answering their questions, providing resources, helping them determine pros and cons, and supporting their options and abilities to self-determine their medical future – and outcomes.

And you’re doing that with no more limitation than those your clients impose themselves. They alone (or their families, or someone like an employer whose only interest is in the patient’s good outcomes) determine any boundaries on the work you can do for them (usually related to the cost of your services.)

… as it should be.

When some other entity that is either trying to make a profit from providing care (independent health insurers), or is trying to save money by paying less for care (all payers including Medicare, Medicaid, in general, government entities) – or both – is paying you for your work, then they will impose boundaries to that scenario above – meaning – your patient-clients are no longer in the driver’s seat, determining their own care. 

What sorts of boundaries?  While we can’t even anticipate yet what all of those will look like, the safe bet is that you will be at the very least restricted in the amount of time you will be paid by them to serve your patient-client. Example: While you might determine that 12-15 hours are required to provide the service they need, the insurer / Medicare entity you work with will give you only 8 hours – that kind of thing.  

Now – I know advocates SO well, and what that tells me is that the majority of you would say “OK – I’ll just put in the extra 8 hours because they need my help” – and then you would work the entire 12-15 hours anyway, at no extra charge.

Am-I-right?

Which leads us to the detriment to your practice:

If you’ve done the math, especially if you’ve taken the course to help you determine what your pricing should be, you should be charging at a minimum $150/hour. If you are charging less than that, you aren’t taking yourself or your practice seriously.

To be clear – that is how much you should be charging if you are running your own practice, and hiring someone, doing your own marketing, your own financials and bookkeeping, etc. You are paying for your own insurance, your own workspace (even if it’s at home.) The expenses are all yours. And the income is all yours, too.

These days, some of you are working for a larger entity that is handling marketing, professional insurance, practice management and more. The numbers I have heard tell me that as a contractor for this type of business, you are earning half or less of the amount you should/could/would if you were out on your own (as described above). Those entities are charging the client, then keeping half to support you.

OK, So Let’s Do Some Math

So – let’s say that “half” is half of the lowest amount any private advocate should be charging – we’ll say that’s $75/hour just for chuckles.

If you are just starting out, are trying to figure out how the profession of advocacy will work for you, finding out what kinds of needs clients have, are cutting your teeth on the flow of the work, etc – and are working under the umbrella of one of these larger management companies, then I honestly think that’s a fair payment. Your expenses are minimal and you are learning. 

But honestly – if that entity is paying you anything LESS than $75/hour, I suggest you rethink what you’re doing. Your value to clients (and to the organization you’re working with!) – is far more than you might realize! To clients, you may mean the difference between life and death. To the entity you’re working for, a fair rate means you will stay in business with them – good for you both.

Reimbursement Math

Now let’s return to the concept of being paid by Medicare or insurance. Both those groups are notorious for paying as little as possible to the professionals they work with. I’ve been told the limited reimbursement for advocacy work – paid to those management entities (not individuals) is about $80/hour with defined, and limited hours, plus defined, and limited billing codes for which an advocate can be paid at all.

That means – using the “half” I described above – that if you decide to jump into the advocacy-Medicare-reimbursement game – you will be paid $40 or less for limited hours (which, as mentioned above, you will overwork anyway.)

You can’t stay in business for that amount of money. You will work too many hours for too little income. 

Doubling your hours while being paid so little means you could be earning more waiting tables or doling out fast food. 

Further, you will burn out having to explain to patient-clients what you can’t do. You will suffer heartache and guilt because you can’t do more for them, or you will do more for them – for no pay. 

That is exactly how you will go out of business. AND – when that happens to too many advocates, it will be detrimental to the entire profession.

Maybe YOU didn’t ask my opinion!  

… but many have asked me on this topic of Medicare reimbursement for advocates.  And now you have it.

Agree? Disagree? I invite you to add your 2 cents to the conversation!  Please do so in the comments section below.