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Physicians decry consequences of consolidation
Modern Healthcare ^ | 2-20-2018 | Alex Kacik

Posted on 02/21/2018 12:51:22 PM PST by spintreebob

Consolidation throughout the healthcare industry is increasing costs and driving more care through hospitals, the Physicians Advocacy Institute warned in a letter to Congress.

Healthcare organizations have been joining forces to try to get ahead of the industry's shifting landscape. The number of physicians employed by hospitals and health systems grew by nearly 50% from 2012 to 2015, with a corresponding decline in the number of independently practicing physicians, according to the letter—supported with research from consultancy Avalere Health—sent to the House Energy & Commerce Committee's oversight and investigations subcommittee.

The decline of the independent medical practice and lack of physician-owned hospitals have negative implications for continuity of patient care, quality, innovation and cost, PAI argued. Medicare spent $2.7 billion more for four cardiology, gastroenterology and orthopedic services provided in hospital-owned settings and beneficiaries paid $411 million more in cost-sharing than they would have if those services had been provided in the physician-office setting, Avalere researchers found.

To level the playing field, PAI proposed modernizing the physician self-referral law known as the Stark law, lifting restrictions on the formation and expansion of physician-owned hospitals, easing participation threshold requirements for alternative payment models, tweaking the 340B drug discount program and bolstering antitrust laws.

Physicians' roles should not be undermined by the industry's push toward corporatization, PAI President Robert Seligson said.

"In some cases consolidation is good, in some cases it's not so good—ultimately, we have to be concerned about it because it has driven independent physician practices out of healthcare," he said.

Only 47.1% of physicians in 2016 had ownership stakes in a medical practice, an American Medical Association study found. That's down from 53.2% in 2012, and research shows that doctors, especially younger ones, have opted to join larger practices rather than own their own amid the rising technology and compliance costs that are part of a growing administrative burden.

This trend has also been fueled by healthcare systems seeking clinically integrated networks that allow them to participate in risk-based payment models. While hospitals can incur a subsidy of $150,000 to $200,000 per acquired physician, they can also increase their referral base as inpatient volumes decline.

Health systems are investing in ambulatory surgery centers and other outpatient facilities to take advantage of higher reimbursement rates and offset losses from caring for the uninsured, indigent, and Medicare and Medicaid beneficiaries, said Dr. Jeffrey Le Benger, CEO of Summit Health Management, an integrated, physician-led independent physician group that includes nearly 900 doctors.

"I don't think there should be a differential in site of service payments," he said. "I think everyone should be on the same playing field, but that would decimate hospitals. I worry about the quality of hospitals deteriorating since I have to send quaternary and tertiary care through them."

Approximately 40% of hospital admissions are reported to come from hospital-owned physician practices, according to research from the Center for Health Policy at the Brookings Institution and Carnegie Mellon University's Heinz College. Further, the share of spending associated with hospital-owned practices rose from 16.9% in 2007 to 26.5% in 2013.

Hospital acquisition of physician practices has been shown to increase prices and funnel more care through hospitals. Physician consolidation has caused about an 8% increase in fees on average over the past 20 years and substantially higher increases in concentrated markets, research shows.

"The evidence shows that when physician practices are acquired by hospitals, three things happen: Prices go up after the acquisition, total spending goes up and referral patterns change," Martin Gaynor, professor of economics and health policy at Carnegie Mellon, previously told Modern Healthcare. "All those are causes for concern."

TOPICS: Business/Economy; Crime/Corruption; Culture/Society; News/Current Events
KEYWORDS: 0carenightmare; consolidation; corporatism; healthcare; healthcareindustry; obamacare; obamacaredoctors; regulation
For decades the silly regulations have accumulated. ACA empowered bureaucrats to double down on regulations. Repeal of ACA is about a lot more than who pays whom for Medical Care. It is about reducing the COST of what must be paid.
1 posted on 02/21/2018 12:51:23 PM PST by spintreebob
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To: spintreebob

Looks like hospitals are becoming the “costco” of health care, but without the lower price.

2 posted on 02/21/2018 12:52:33 PM PST by robroys woman (So you're not confused, I'm male.)
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To: spintreebob

My PCP showed me the clerical staff his three person practice has. It increased by 100% in the past four years. All they handle is insurance claims and billing. The new electronic records system cost his practice $400,000.

He sold to one of the local hospitals. His salary is guaranteed. He has no administrative duties. He wished he had done it years ago.

I am pretty sure his staff wasn’t trilled.

3 posted on 02/21/2018 12:57:17 PM PST by Vermont Lt (Burn. It. Down.)
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To: Vermont Lt

There is a lot of that sort of thing going on.

4 posted on 02/21/2018 1:05:37 PM PST by FreedomPoster (Islam delenda est)
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To: spintreebob
Progressive ideological interference in patients' medical care--all a disguise intended to lead to single-payer government control over 1/6 of the American economy, otherwise known as "socialized medicine," has led us to where we are.

President Reagan identified the dangers of such interference, with its known tyrannical goals, in a message which is as useful to knowledge and applicable to liberty and freedom in the Year 2018 as it was when he recorded it.

5 posted on 02/21/2018 1:13:44 PM PST by loveliberty2
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To: Vermont Lt

In my rural and small town region, one large medical corp bought out all the Dr practices eight years ago, and already owned the local hospitals. Nearly all of the doctors that were here in 2010 moved away. It could be worse. At least the medical corporation is nonprofit.

Now most of the doctors are very young, with many being recruited as interns from other parts of the country, and doing residentcy locally.

Today, no doctor is taking new patients. When my doctor moved to greener pastures 6 weeks ago, the only appointment I could get was in a clinic staffed by recently graduated PAs and NPs.

6 posted on 02/21/2018 1:15:38 PM PST by jimtorr
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To: jimtorr

Handled insurance for a group of 5 independent, internal med/hematologist/oncologists. Then they got into a PPO with other physicians. Paperwork just escalated. They closed the lab and the oncology suite. Money over medicine.

Only one physician is still in practice.

7 posted on 02/21/2018 1:49:56 PM PST by sodpoodle (Life is prickly - carry tweezers)
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To: FreedomPoster

Around Houston Emergency Clinics are popping up all over the place.

8 posted on 02/21/2018 2:00:56 PM PST by Terry Mross (Liver spots And blood thinners..)
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To: spintreebob

Anti-Trust Laws, what are those?

9 posted on 02/21/2018 2:01:35 PM PST by dfwgator
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To: spintreebob

Consolidation another word for collectivism. Consolidating the schools of America should have frightened Americans enough, but the then entrenched media told them how good it was for them.

10 posted on 02/21/2018 2:27:49 PM PST by Steamburg (Other people's money is the only language a politician respects; starve the bastards)
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