Medicine

I want to do charity work. Reduce my taxes!

By Chris Rangel MD ⋅ January 16, 2007 ⋅  Email this post ⋅  Print this post ⋅ Post a comment

Yesterday’s MLK day (except maybe in AZ) got me thinking about charity care and our medically under served and uninsured population. While the number of uninsured in this country has climbed past 45 million, the percentage of physicians who provide any type of discounted or free care has dropped from 76 to 68% in the last 10 years.

Part of the reason is that there are few if any protections against liability in treating a population that tends to be less healthy, have more bad habits (obesity, smoking, alcohol, drug abuse), and be less complaint with treatment and follow up. Ergo, they are at higher risk of bad outcomes and bad outcomes tend to lead to lawsuits regardless of any actual malpractice. Remember the old medical school adage; “No good deed goes unpunished.”

But most of the reasons have to do with time constraints. When a physician is doing something for free then during that time they are not creating cash flow to cover their clinic overhead and pay down their student loans, which average almost $120,000. So doing charity care means taking a cut in their take-home pay. Again, no good deed goes unpunished.

But why does it have to be this way? It doesn’t, because most physicians are essentially government employees who should get compensated for their “charity care”.

I am about 70% a government employee. I.e. I get about 70% of my income from billing Medicare and Medicaid for services rendered. But what the government giveth they then taketh away in the form of about 30% in income taxes. So 70% of my income tax is literally money that the government pays me and then turns around and takes right back come every April. Crazy. The government could just pay me 20% less for my Medicare and Medicaid billing and cut my income tax instead of paying extra bureaucratic fees to have this money go on the pay and tax marry-go-round.

Or they can give me tax credits whenever I care for someone who has no health insurance and cannot afford their own coverage. US hospitals are required by law to treat and stabilize people regardless of their ability to pay for their care. But many hospitals get reimbursed by the Federal government (via the Disproportionate Share Hospital (DSH) programs) while the physicians who actually see these patients usually don’t even get a kind word in compensation. With tax credits I can get compensated (retroactively) when I see the patient in the hospital, when I see them on follow up in my office, and if I decide to “donate” my time to staffing a local indigent clinic.

Wow, what a great idea. Too bad it will never happen. Such tax credits would essentially amount to a government social program but in this case the actual government role would be limited to adjusting tax burdens and there is no way the government would stand for that! Tax credits go directly to the tax payer but any social program must involve funding that is filtered down through a morass of bureaucracy to the benefit of tens to hundreds of thousands of government employees and independent contractors who all have their hands out. A social program without the massive bureaucracy? That’s blasphemy!

And while the uninsured patient would benefit in the form of medical care, the person who benefits monetarily would be a physician and our government would never stand for that because the irony of any social program is that while the poor can benefit, the rich cannot. The standard formula for a social program is that the taxpayers get taxed, the needy get taken care of and the bureaucrats consume what’s left. But as taxpayers most physicians are in the top 10% and it is those in this top 10% who pay 50% of the total tax bill each year. So any social program should properly be a tax burden upon physicians. The very idea that they would directly benefit is equally blasphemous! Marx and Lenin would surely be turning over in their graves (and don’t forget Engels or Poland for that matter)!

Tax credits would never get around the ‘ol “no tax cuts for the rich” protests as if physicians somehow deserve to be punished via taxation for their high economic status. And ideas like these will never get around the new Democrat controlled Congress.