THE EDITOR'S CLINIC
It has been announced that the Internal Revenue Service will be spot-checking dentist's offices for compliance with the regulation of the federal government price commission which requires that each professional office post a visible sign listing principal services, the fees for each service, and any changes in fees since November 14, 1971. Anyone willfully violating the regulation is subject to a fine of up to $5,000.
The government has done two things. It has lumped professional fees with prices of commodities and it has required fee scheduling. To the government, as to the insurance industry, the dentist is a vendor, the fee is a price, and fees must be listed on a schedule. If the profession has agreed to this, as a statement of the ADA may indicate, we may already have passed a point of no return.
The profession may have an obligation to the public to provide accountability for fees for professional services. The mechanism of the fee schedule is an improper way to do that.
The danger in fee schedules is the likelihood that the profession and the public will become the victims of the fee schedule. When fee schedules become not just announcements of what the fees are in an individual office, but the standard for an entire profession, control passes to the fee schedule. This is control not only of the fee which can be adjusted upward and, especially, downward; but in addition, the fee schedule becomes a table of procedures covered by the program. Diagnosis then passes from the orthodontists to the fee schedule. It becomes a matter of selecting what this patient has that the schedule will pay for. The primary concern of the professional man is diverted from what is wrong with the patient and how to correct it, to how efficiently the office can operate to turn out an optimum number of units of work and take an optimum number of units of money from the fee schedule. This is how simpler appliances become popular, this is how partial treatment may become the mode, this is how standards of excellence may quickly decline to levels of mediocrity.
An example of the danger inherent in fee schedules can be seen in the British system. There is a fee schedule which states which procedures will be paid for and how much will be paid. There is a relatively fixed annual amount allocated for dentistry. If dentists, in an effort to improve their incomes and get a bigger slice of the pie, increase their hours or their productivity, they may individually succeed to some small extent. However, the following year, the fee schedule is adjusted by dividing the larger number of operations into the relatively constant fund of money for the program. The result is a reduction for the items on the fee schedule. Now, everyone has to work a little harder to achieve the same income he had last year.
It seems likely that we will go in the direction of the British system. We have begun with the concept of fee schedules. It is reasonable to expect that our health care program will have a high utilization rate and that, in short order, the costs will become staggering. The solution at this point is to reduce the fee schedule in order to reduce the total outlay and, after that, to limit the total outlay.
One more point. There is an element of false security in the way that our government and our private insurance carriers have tended to look at fee schedules. It is on what they choose to call a "usual and customary" fee basis. A naive individual would think that this was just fine, that he would charge his usual and customary fees. Unfortunately, that is not what the phrase means. It is a new language. "Usual and customary" refers to what is usual and customary in your community. Frequently this is established as the 90th percentile of usual and customary, or fees up to what 90% of the professional men in an area customarily charge. If your fee is lower than the 90% percentile--let us say that it is 50% of what 90% of the professional men in your area customarily charge--it remains at that level. The 90% represents the maximum allowable fee. You might say, "I'll go along with that. That sounds fair to me." Maybe. Usual and customary fees have also been known to have been set up on a basis of 40% of the 90th percentile.
By the simple act of requiring fee schedule posting, our government seems to have bought the assumption that fee schedules are the preferred basis for fee structuring. We better hurry up and show that this is not so and that there are better ways of structuring fees. But, to do this, we are going to have to first find that out ourselves.
