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How Healthcare Reform Is Changing the Way Your Doctor Does Business

Content provided by: Better Medicine from Healthgrades

The Affordable Care Act (ACA) may change how your doctor runs his or her practice. Some of these changes may be obvious to you, and others will occur behind the scenes.

You may see fewer private practices in the future. According to a 2013 survey of nearly 3,500 doctors, 40% are either employed by a hospital or work in a practice owned by a health system or hospital. This is an increase from 2012. Only 22% work in a practice where they have an ownership stake and just 15% have a solo practice. Both of these decreased from 2012. This trend could have consequences for the healthcare system by limiting choice and decreasing competition.

In the same survey, half of doctors reported they would take steps to reduce services over the next one to three years. Working part-time, seeing fewer patients, retiring, and switching to concierge or cash services are all potential strategies. Concierge medicine is a retainer-based arrangement between a patient and a doctor. It does not involve insurance or government programs, and it’s on the rise.

Accountable Care Organizations

Also on the rise is doctor participation in an Accountable Care Organization (ACO). An ACO is a network or group of healthcare providers that works together to coordinate patients' medical care and chronic disease management. About one in five doctors say their organization is or will be part of an ACO.

ACOs will make it easier to share medical information about patients through use of electronic medical records. ACOs also will allow your medical team to provide better continuity of care for you and your family. And ACOs should help reduce waste by avoiding duplicate lab tests, screenings, or other care.

ACOs were originally part of Medicare. The network’s ability to control costs and provide quality care determines the Medicare payment it receives from the federal government. In the last year, commercial ACOs have grown, with up to 14 million privately insured patients using ACOs. These commercial ACOs generally contract with multiple insurance companies to deliver quality, cost-effective care.

How Your Doctor Gets Paid

Although some aspects of medical practice might be changing, the ways in which doctors get paid will be similar to pre-ACA days. Doctors are often paid through a combination of:

  • Patients' out-of-pocket payments
  • Private insurance
  • Medicare
  • Medicaid
  • Other programs such as TRICARE

For example, if a doctor’s office bills Medicare for a service, Medicare will typically pay 80% of the cost. The other 20% comes from the patient or a second source of insurance. Similarly, private insurance pays a certain percent of medical services, while patients pay a co-pay.

Doctors who accept Medicare and Medicaid will see changes in reimbursement. For example, the ACA requires Medicaid to pay the same amount as Medicare for health services. This means an increase for doctors. And doctors and hospitals that provide high-quality care will be eligible for incentives. Incentives should improve patient health and be cost effective. Medicare also will pay a 10% incentive to doctors with a focus on primary care. With the rise of commercial ACOs, private insurance providers might do the same.

Key Takeaways

  • More doctors are working directly for hospitals, but those in private practice have new ways to partner with others in their community. This includes participating in ACOs.
  • ACO functions, such as moving patient information to electronic medical records, should make it easier for your doctors to coordinate your care and have more streamlined office operations.
  • Doctors have incentives to provide patients with a better quality of care.


1. The Affordable Care Act: A Quick Guide for Physicians. National Physicians Alliance. Accessed July 26, 2013.

2. Accountable Care Organizations. Medicare. Accessed July 26, 2013.

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