Surgeon Cuts Out Third-Party Payers

Greg Freeman for HealthLeaders Media, August 5, 2011

At some point, usually in the midst of struggling with third-party payers over meager reimbursement and oppressive bureaucracy, most physicians fantasize about chucking it all and just dealing directly with patients on a cash basis. It’s only a dream for most doctors, but one general surgeon in Las Vegas has found a way to make it work.

Five years ago, Kevin Petersen, MD, founded a practice called No Insurance Surgery to offer surgeries to the under- and uninsured for a heavily discounted, all-inclusive, one-time fee. Petersen, who was board certified in 1986 and has performed more than 15,000 surgeries throughout his 25-year career, has opted out of the managed care system and no longer accepts new patients with insurance. He recently performed his 900th insurance-free surgery.

Petersen says his decision to opt out of the system by dropping all contracts with insurance companies is a direct reflection of the troubled state of the healthcare and insurance industries and the growing number of patients without insurance or with too little insurance.

“I simply stopped renewing contracts and they all expired over a period of one to two years,” he says. “During that time I did not accept new patients with insurance. I kept all my established patients with insurance, but through attrition and the contracts expiring, now nearly 100% of my practice is cash pay.”

Petersen says the move has dramatically changed his practice. “I make as much or more than I made when I was the busiest with insured patients but I’m working half as much.”

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