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Monday Rx | August 19, 2019 | Confidential Physician Compensation AB 1404, Physician Reimbursement Challenges, Physician Burnout Survey, and Young Physicians Mixer

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Confidential Physician Compensation Information

Last week I shared the latest on AB 1404 (Santiago) which is headed to the state Senate Appropriations Committee. Santiago and the SEIU-United Healthcare Workers West union specifically cited Kaiser Permanente, which entails the not-for-profit hospital and clinic arm Kaiser Foundation Hospitals; the not-for-profit Kaiser Foundation Health Plan, which provides insurance to Kaiser members; and the for-profit Permanente Medical Group that oversees doctors who work at Kaiser. The bill would close an alleged loophole that allows not-for-profit systems to hide deferred compensation when not-for-profit entities are used to provide a supplemental retirement plan to employees that work for a for-profit arm of the company. The legislation would require organizations to tell the secretary of state the total amount of deferred compensation allocated by the not-for-profit entity every year, the name and title of each individual, whether taxes were paid on the deferred compensation, and the agreement or legal document governing the deferred compensation.

Here’s the rub: This bill is not only unconstitutional (in regards to targeting one organization – labor has introduced this bill at the same time they started negotiations with Kaiser Permanente), it also likely violates privacy, antitrust and employment laws. There is also significant risk and impact to physicians outside of Kaiser Permanente relative to reimbursement, compensation, and recruitment efforts.

This bill would require the Kaiser health plan to submit confidential physician compensation information on about 6,500 Southern California Permanente Medical Group (SCPMG) physicians to a public state website. This is not only an invasion of privacy but more importantly – it also sets a precedent that many other groups and physicians would rather not have – an easily accessible database with physician salaries, incentives, pension benefits, etc.

Also, this kind of website could potentially be used in a coordinated manner by health care payors (e.g., other health plans, hospitals) to impact physician compensation negatively. This could then have the downstream effect of worsening recruiting efforts for physicians to local practices, and even to the state, potentially exacerbating the health care workforce shortage we are currently facing in California.

What do you think?


Staggering Physician Reimbursement Challenges

I received feedback from many members about reimbursement challenges members continue to face. Dr. Emil Avanes shared the following:

“Last year, the Centers for Medicare and Medicaid (CMS) tried to change how it reimburses physicians. In short, they were going to create a blend rate that was between an actual level 3 and 4 visits. This was stopped at the last minute. If CMS takes reimbursement all the way down to "3.5", physicians will lose additional revenue. As it is, we are strained to perform. Further regulation will only hinder the physician burnout that is currently apparent in our industry. Institutions may increase reimbursement by seeing more patients, but we know this will be more difficult than it already is.

The areas we have to fill the leadership void are:

First, messaging regarding the massive stupidity of EHR's reflecting paper-based billing and coding guidelines--the amount of disruptive innovation that can happen when this insane cap gets to take off. Second, physician reimbursement has not been discussed in an effective manner; we are no longer afforded middle-class status with the way our student debt has risen, and our compensation has staggered along and finally, the silos of healthcare have to be brought together: the insurance companies, pharma, private practice physicians, organized medicine, and the medical schools.”

Learn more:


Attending the 2019 NEPO Summit

The 2019 Network of Ethnic Physician Organizations (NEPO) Summit will be held later this week at the Westin Pasadena. This year's theme is "Standing Up for Health Care in California." The two-day summit is an innovative educational event for physicians, public health professionals, advocates and community leaders that offers policy and best practices for reducing health disparities, building diversity in the workforce and increasing cultural competency in clinical care.

Register Here:


California Transformation Summit

Also, this week is the California Transformation Summit. State and national health care leaders will convene to learn about the breadth and depth of practice transformation efforts across California, including the impressive gains in quality and cost savings for adult and pediatric patients in both commercial and government-supported programs. Topics will address changes that led to dramatic improvements in clinical quality, patient experience, and utilization.


Tips from Avery's Corner

Medical Economics took a survey polling Physicians on Physician Burnout. (August 12, 2019)

Q: Have you felt burned out from practicing medicine at any point in your career?           Yes, 92%

Q: Do you feel burned out right now?           Yes, 68%

Q: What has contributed the most to your feelings of burnout?

  • Too much paperwork and government/payer regulations – 37%
  • Poor work/life balance – 19%
  • EHRs – 17%
  • Lack of autonomy/career control – 9%
  • Insufficient pay/declining reimbursements – 7%

Q: How do you cope with burnout?

  • Spending time with family and friends – 29%
  • Exercise – 26%
  • Nothing, I don’t cope – 13%
  • Hobbies – 10%
  • Eating junk food – 6%
  • Practicing yoga/meditation – 5%
  • Alcohol – 4%

Q: Have you ever talked to fellow physicians about burnout?           Yes, 64%

Q: Do you plan to seek, or have you sought professional counseling?            No, 80% Q: Has burnout ever made you want to quit practicing?            Yes, 73% Q: How has burnout affected your career as a physician?

  • Want to quit
  • Lack of joy
  • Considering early retirement
  • Switching to part-time
  • Giving up

If you are feeling burned out, you may be considering selling your practice. Should I join a large medical group or a hospital Foundation model?

Here are some important tips to help you to decide.

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Top Tips to Satisfy Evolving Patient Demands

Today’s physicians are running their practices at a time when patients have more options, more choices, and are demanding greater convenience. Three in four people have gone online to find out about a doctor or dentist, and more than 57 percent do so regularly. Attracting and retaining patients in this environment requires improving each digital touchpoint for patients to meet their needs, both before and after their visit.

Sign Up Here:


It's finally here!

Join us for the 2019 Young Physicians Networking Mixer hosted by the Young Physicians Committee and District 1.

It’s time to recharge and reconnect with friends and colleagues, or make new ones!  All in a relaxed environment overlooking the bright lights of the Downtown LA Live scene. Enjoy food, beverages, great company, and entertainment!

LACMA has hosted the young physician mixer every year for almost a decade. This event is FREE for LACMA/CMA members.  Nonmembers are $20.

Thank you to our event sponsors!

RSVP: September 6th Mixer. Email:


Register Here:


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"If everyone is moving forward together, then success takes care of itself." – Henry Ford

        Gustavo Friederichsen Chief Executive Officer Los Angeles County Medical Association “If it matters to our LACMA members, it matters to me.”