Physicians, Health Systems and the Drive For Market Dominance

Brian Klepper

Posted 5/23/13 on Medscape Connect’s Care & Cost Blog

BK 711Several physicians have reached out recently to discuss attractive employment offers from health systems. They are invariably conflicted. They understand the trade-offs, that they’ll give up the autonomy they’ve become accustomed to in exchange for more money and fewer practice management headaches. On the down side, they’ll be accountable for generating significant revenues, sometimes independent of care appropriateness.

Most also are aware that the same care services they provide now will be considerably more expensive once they’re part of a system. Many appreciate that because health systems are corporations with a heavy focus on optimizing short term gains, their future employer’s loyalty is suspect. And then there is the question of whether the health system’s management team is competently preparing to be sustainable in a market that could change dramatically.

As health systems maneuver to dominate regional markets, driving utilization and gaining more leverage over contractual pricing, physician employment has become their principal lever. Primary care physicians (PCPs) are now precious commodities that can manage populations and steer patients into the system’s services. Other specialties – e.g., cardiology, orthopedics, neurosurgery and even gynecologic oncology – are desirable if they’re high yield, driving lucrative, intensive use of inpatient and outpatient services.

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How Physician Practices Can Prepare for a Health Care Marketplace

Brian Klepper

Posted 4/21/13 on Medscape Connect’s Care and Cost Blog

BK 711What is the path forward for physicians who want to remain in private practice, outside the constraints of health system employment? How will the environment change and what new demands will that place on practices and physicians? What follows are the observations of one industry-watcher who has worked on all sides of health care, but who now spends most his time focused on the interests of those who pay for it. No crystal ball, but several trends are clear.

There are now concrete signs that health care’s purchasers are exhausted and seeking new solutions, that a competitive marketplace is emerging and getting increasing traction. As they abandon ineffective approaches, the paradigm that has dominated the industry for the past 50 years will be upended. The financial pressure felt by buyers will transfer to the supply side health industry that has come to take ever more money for granted.

For decades, fee-for-service payment, inclusive health plan networks, and a lack of quality, safety and cost transparency have been enforced by health industry influence over policy, effectively neutralizing the power of market forces.

Without market pressure, physicians have felt little need to understand their own performance relative to that of their peers. The variation of physician practice patterns within specialties has been high, with some physicians’ “optimizing their revenue opportunities” by veering wildly away from evidence-based practice. Even so, until recently in this dysfunctional environment, it has been nearly impossible to identify high and low performers.

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Who Will Speak For Physicians and Their Patients?

Brian Klepper

Posted 8/29/12 on Medscape Connect’s Care and Cost Blog

Dr. George Lundberg has an important article on Medpage Today that deserves the thoughtful consideration of every American physician. He argues that the American Medical Association, a successful and representative organization for many decades, more recently “fails on both fronts” to fight for doctors and for the health of the American people. It has become, he says, “unsalvageable.”

In a companion piece earlier this month, he called on all physicians to become lifelong members of the AMA, as a way to gain professional impact and to make the AMA more reflective of American physicians’ concerns. “If you are an American physician and you don’t like what the AMA has done and is doing, if you are not a member, shut your mouth, you have no right to complain.”

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The Economics of Being a Practicing Physician: Greater Frustration, Lower Income, More Defensive

Jane Sarasohn-Kahn

Posted 4/26/12 on Health Populi

One-half of physicians believe they’re not fairly compensated for their work – in particular, those working in primary care. Only 11% of doctors considering themselves “rich.”Medscape’s 2012 Physician Compensation Report compiled data from over 24,000 U.S. physicians across 24 specialties and found the bulk of physicians to see themselves working harder and 1 in 4 making less money than last year.

This has led to growing frustration and worry, where some physicians are resenting the large pay gap between specialists and primary care. That frustration looks poised to increase with doctors concerned that accountable care will further eat into incomes, and increased regulation and administrative hassle “take the joy out of medicine,” as Medscape coined the feeling.

In 2011, pediatricians earned on average about one-half of what radiologists took home in pay: about $150K versus $315K. The top physician earners along with radiologists were cardiologists, urologists and orthopedic surgeons. The lowest-earners were pediatricians, internists and family medicine doctors. Still, while they are top-earners, orthopods’ and radiologists’ income declined an average of 10% between 2010 and 2011.

Physicians in single and multispecialty group practices, and those within healthcare organizations, earn higher incomes compared with colleagues in academia, outpatient clinics and solo practitioners.

If they had to do it all again, would physicians choose to be physicians? 54% would still pick medicine as a career…the other 46? Not so much…

Health Populi’s Hot Points: Economics is driving physician discontent in the United States. Not only are at least half of medical specialties seeing falling incomes, but the future potential for money looks dire in at least two respects: accountable care is seen by at least one-half of physicians as a cause for income to decline; and, regulations and paperwork eat further into profit margins for physician practices.

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Surveyed Physicians Are Gloomy About Health Care Reform

Patricia Salber

Posted 3/12/12 on The Doctor Weighs In

Recently, The Doctors Company (TDC), the country’s largest insurer of physician and surgeon medical liability, decided to survey doctors to determine what they are thinking and feeling about health reform.  The results are pretty gloomy.

To put this in context, it is important to understand a bit about how TDC conducted the survey.  First of all, the universe of doctors they reached out to were doctors insured by The Doctors Company.  That means large self-insured medical groups, such as those affiliated with Kaiser Permanente, were not included.  Nor were doctors whose insurance was provided by their employers or doctors using other insurance carriers.  This matters because if the TDC insured physicians are not representative of doctors as a whole, the results of this survey would not necessarily reflect the attitudes of all doctors.

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Hope Lies with Residents

Paul Levy

Posted 3/1/12 on Not Running a Hospital

I remain relatively new to the health care field, but even in that short time, it has become evident to me that the pace of quality and safety enhancements and front-line driven process improvement in hospitals is inadequate given the scale and scope of harm that occurs to patients.  Indeed, it can be viewed as a paradox that the doctors of America, a group of dedicated, well-intentioned, intelligent, and highly trained individuals, constitute one of the top-ranked public health hazards in the county when as they work together in the nation’s hospitals.  That they collectively have not made much of a dent in the problem of reducing harm is, I believe, a product of their training.

As Brent JamesJay Kaplan, and others have noted, doctors are trained to be artists, to apply their intellect, creativity, intuition, and judgment to the care of each patient. That is well and good when the case is complex, but the vast majority of medical care is not complex.  It calls for standardization, adoption of protocols, and scientific experiments of process improvement to modify those protocols to enhance care and reduce harm.

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Doctors Going Broke. So What?

Tom Emerick

Posted 1/11/12 on Cracking Health Costs

According to a nearly breathless article in CCN, some doctors in the U.S. are going broke.  Read it here.  I feel sorry for anyone who goes broke, but why all the gnashing of teeth when it happens to a health provider?

According to the author, some doctors have unsustainable debt and are facing reimbursement reductions by insurers.  A good question is whose fault is unsustainable debt?  After all, many of our institutions have become bloated and can’t adapt to the economic downturn.

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