Tell it like it is physician Terry Bennett is back in the news, detailing the problems he sees with the health care system. One interesting point he makes is how hospitals may be artificially causing a PCP access shortage, thus diverting patients to the emergency room, which generates revenue for the hospital:
The second issue involves the driving up of health care costs by what Bennett calls “corruption” at the hospital level.“Once hospitals came to own all or most of the practitioners in their area, they controlled how, when and where patients are seen, and, most importantly, how much it costs,” he said. “By simply diverting patients from outpatient care to the emergency room, a fee differential of $75 to about $1,000 occurs.”
Bennett believes this is done hundreds of times a day in larger hospitals, generating hundreds of thousands of dollars for traditionally not-for-profit institutions. In order to utilize that revenue so as not to show a profit, hospitals spend it on extravagant construction schemes and new equipment acquisition.
“It is all done in order to bury huge profits being earned by what is, in principle, a not-for-profit institution,” Bennett contended.
(via a reader tip)
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{ 9 comments }
I doubt there is any such plan in action.
Starting a practice is an expensive and unfortunately less certain enterprise now than in the past. It isn’t enough to be trained and ready to work with a community needing doctors to assure a successful practice launch. In order to be able to attract patients, one has to have access to some insurance panels, which, depending on the area, can take a long time to establish. Patients could have limbs falling off and still not be willing to see a doctor out of their network. Without an income stream, the practice cannot build a cash flow and relieve its startup costs, which can require a substantial loan. Bringing in enough to cover operations and pay the doctor a living–no small consideration especially if there is educational debt to pay–is a non-negotiable requirement. And many recently, and some not-so-recently graduated doctors cannot afford a long period without net earnings to live on. Any hint of abnormal startup risk, whether it is difficulty getting on local insurance panels, undesirable payer mix, high real estate and/or other operating costs, unattractive lending terms or getting hospital privileges or any other barrier to earning can make the risk seem not worthwhile to the prospective small business owner/doctor. Just having a community screaming for dotors isn’t enough. Screaming doesn’t pay the bills.
I’m not sure how clogging up the ED generates more revenues for the hospitals as an overwhelming proportion of EDs in the US lose money due to piss poor reimbursement rates providing indigent care.
Last time I checked ERs are big money losers for hospitals. His article is misinformed.
This is a definite LOL post. The idea that any hospital would implement a strategy that steers patients TO its ER is utterly preposterous. Are you sure this isn’t a gag from the Onion?
Some ERs absolutely Do steer patients towards its ER. Where I live they advertise on local TV stations. Promise to be seen within 20-30 minutes. Fast track this or that. Everyone knows that fast track is not intended for REAL emergencies, so just who do you think they are marketing towards?
Some of you just seem to live in a vacumn, where you have NO comprehenison of what is going on outside of your own little space.
I agree with anonymous 1:53. Hospital administrators of community hospitals feel you are clogging up the ER only if you are uninsured. The well-insured are welcomed with open arms, no matter how minor the complaint.
Believe it or not, hospital administrators (including heartless finance types like me) are less concerned with an ER patient’s insurance than in her condition. The real “crisis” in the ER is over-utilization. The clinicians must spend far too much of their time dealing with runny noses and other non-emergent problems, which leaves fewer resources to devote to ACTUAL emergencies.
That is an interesting idea, that there is a conspiracy of hospital administrators trying to promote a scarcity of primary care doctors.
Two thoughts:
One–in my opinion hospital administrators are just that evil.
Two–while being that evil, there are just not that smart. It also takes long term planning. Long term planning in any mid-size hospital refers to months, not years.
The only thing more chaotic and random than an ER on friday night is the hospital boardroom on monday morning.
b
I feel like anybody who understands the slightest amount about reimbursement for ED care saw this as an April Fool’s joke. Move along, nothing to see here.
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