Anesthesia Management Hospitals hiring doctors to get ready for reform
Author : Doc Clemens
Hospitals hiring doctors to get ready for reform
Hospitals made disastrous decisions in the 1990s in hiring doctors. Now, they’re again buying physician practices — saying better management will make the difference this time.
In the early 1990s, many hospitals across the country started buying doctors’ practices. The purchases often proved to be disasters. Many doctors were not nearly as productive as employees as they were in their own practices so hospitals abandoned the idea.
Now, hospitals are at it again, convinced they’ll handle the physicians better this time around.
It’s a national trend. The American Hospital Association reports that the number of doctors working for hospitals has increased by 32 percent since 2000, a trajectory that’s accelerating as medical companies prepare for healthcare reform.
Some experts are skeptical it’s a very tricky business to buy physician practices they can’t buy them, put them on salary and expect their practices to be just as profitable as they always were.”
But others say hospitals have learned from their past failures. The hospitals’ motivations vary from setting up an integrated care network of primary physicians and specialists scattered in offices into a structure that could be converted into an accountable care organization, or ACO. ACOs, which reward positive outcomes for patients rather than the traditional fee-for-service model, are part of the federal healthcare reform act.
Other hospitals have a slightly different focus, concentrating on hiring doctors — called hospitalists when they are employed by the hospital — who treat patients in their facilities, and on hiring surgeons and other specialists who fit particular hard-to-fill jobs, such as neurosurgeons.
Most hospitals claim they are employing doctors to prepare for ACOs however many believe much of this activity is to control physicians and keep them within their system. Building ACOs is a means to get there.”
Snapping up desirable doctors’ practices could offer hospitals a competitive advantage in the near future. With federal reform plans to reduce healthcare costs by paying for bundled care, rather than a fee for each individual service, the race is on to organize systems. In some parts of the country, insurance companies are the ones setting up networks. In other places, large doctors’ groups are trying to establish their own ACOs. Barbera and other experts say those who set up the biggest networks could come to dominate the new healthcare landscape.
In the early 1990s, the rush to buy doctors’ practices was driven by venture capitalists and healthcare companies intent on creating large corporations offering physician services. Competitive bidding drove up the prices. Hospitals overpaid physicians and hospitals did not establish productivity standards, which resulted in the physicians playing golf more.
Doctors aren’t used to the same dynamics that other businesses follow because they’re accustomed to working on their own Changing from a small office to a big institution can “cause real disconnects. In the 1990s, there was little attempt at oversight of the doctors. It was just a collection of independent businesses running pretty much the same way they had always run.
In the late 1990s, most hospitals had decided they had had enough and in many cases simply gave the doctors’ back their practices.
Patient satisfaction is one compensation measure but productivity also counts — but sometimes not in expected ways. Hospitalists are often instructed to limit the number of patients they see in a day because seeing too many might result in lowering the quality of care. For surgeons, compensation could be measured in other ways, such as mortality rates.
The new contracts are also careful to avoid federal anti-kickback statutes that prohibit hospitals from over-compensating doctors who then make sure their patients come to the hospital. Hospitalists helps the system operate more efficiently. They also hire surgeons and other specialists to fill the shortage of doctors willing to take calls in the system’s emergency rooms. And for surgeons, being part of a hospital offers them malpractice insurance because many can no longer afford it on their own.