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Reimbursement:
What Do Docs Really Make ?  by Jarrod Shapiro, DPM Joined practice of John K Throckmorton,DPM,PC Lansing, Michigan July 2006 I thought I'd spend this week's editorial on a rather eye-opening exercise: reviewing how much a podiatrist actually makes on what they bill. This is a useful exercise for several reasons. First, many of you are or will be in negotiations for associateships around the country. You may hear someone say, "I bill out X dollars per year." It may sound great to you, but what they bill out is not what they get paid. What a doc "bills out" is their accounts receivable, what is billed to the insurance company. Insurers will pay out a certain amount of this, and when you add the pay-outs from all your patients together, that's your gross (before you pay the bills). Also keep in mind for those of you negotiating a salary that you'll have to "bill out" a lot more than your salary to break even. For example, you perform a bunionectomy and bill the insurance company $1000. You may actually receive $500 in payment. The other $500 is basically a write-off. To generalize this, if your base salary were $80,000 you'd have to bill out somewhere around $160,000 (if you were reimbursed at a 50% rate) to pay your own salary. Add to this health insurance, phone, car and other benefits you've negotiated and it'll cost your boss more than your base salary to afford you. Now, that doesn't mean you should take less than you're worth. Just keep in mind it's not a simple formula. When negotiating, you need to know what their gross income is and what their overhead percentage is. Your contract should also specify that whatever percent you make is of the gross income of the practice, not the net-which clearly is much less.
Second, you should know just how little
we actually get paid for our services to patients. We take the
risks, work late hours, and sweat over our patients, but actually
get paid very little for it. So, here are a couple of examples of patients I've seen in practice over the past few months. I'm including a nonsurgical and an operative treatment example to give you an idea. Remember, reimbursement varies around the country, so my mid-Michigan examples won't apply exactly to other parts of the country. New patient visit with an acute ankle sprain:
E&M 99203, 73630 (unilateral 3 view foot
radiographs). Established patient with Blue Cross Blue Shield that I performed a hallux IPJ arthroplasty and percutaneous TAL for a nonhealing diabetic neuropathic hallux ulcer:
27685 (TAL) billed out $650, paid
$571.92 by insurance. Take the time to review these concepts with your attendings and ask them to show you their office paperwork. You'll see doctors don't make as much money as they used to! Talk to me,
This program is supported by an
education grant from MAJOR SPONSORS
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