As health care consolidates, physicians face a choice

Amid massive change in our healthcare delivery systems and seismic shifts in many regional markets, physicians are increasingly being faced with a simple choice: be acquired or become employed as part of a large healthcare system, or stay independent while offering a compelling service that hospitals and health systems value.

The changes occurring in our care delivery systems have generated great interest, innovation, and yes, fear among many in healthcare, doctors included. Some recent news stories have documented physician practices under severe financial stress, or even going bankrupt. Others note the formation of gigantic health systems and growth of accountable care organizations.

So what is a physician to do when evaluating their options?

Physicians (and physician groups) have a critical decision to make. Will doctors become an employee of an entity that delivers care, or a valued partner and consultant to that entity? Both paths are available, but whether the one you choose works out for the best or turns out to be an absolute disaster depends on how deliberately you approach your value as a doctor within the healthcare system.

Thinking deliberately means putting aside the standard complaints I hear so often from doctors today about how tough their decisions are, whether it’s about rising overhead pressures, decreasing reimbursements, government regulation, or fights with insurance companies, and instead taking time to think about themselves as clinicians and healthcare practitioners.

If worrying about those pressures is too much, your choice is easy. Pick a partner and approach your local or regional health system about becoming a part of them. They have enormous resources and should be equipped to better manage this market transition, wherever it may lead. You can still complain about them being too (pick your adjective) big, ineffective, slow moving, unconcerned, etc. The reality is if you have decided you can’t provide a compelling and unique service that is worth marketing and offering then you have sealed your fate.

On the other hand, market consolidation, with more and more physicians becoming employees of large health systems, isn’t necessarily the best way forward. Suppose you or your group offer a unique service. It could be how you manage patients with high risk diagnoses, complementary and alternative medicine offerings, a unique way of managing patients with obesity or an innovative home health product.

In that case you can approach your hospital system, and others, about providing that service in a partnership setting. Partnership involves taking a risk and providing a service that someone else values. It means investing in a product or service to seek a better outcome. The system will reward you IF you have proven that it works and someone trusts that you can do it better, faster and yes cheaper than they could themselves.

That is not a bad thing. Partnerships are where innovation and ideas are fostered and honed. Some of those ideas work and deliver incredible results. Some fail because they do not deliver, address the wrong issue or are ill-timed. That doesn’t mean we should stop trying to innovate. When I speak with health system leaders I am struck that they have the same concerns about the proper positioning of resources, where they need to invest and where they are going to find good partners to help them navigate this time of transition.

Nearly all physicians do what they think is in the best interest of their patients. But the fact is, some do it better than others and deliver better results and a higher value. The value equation means higher quality, lower cost and a better patient experience.

In the end physicians, and physician groups, have a choice when it comes to their fate. The path each takes will be intentional, or not. Whether we want to admit it or not, we hold our fate in our own hands.

Angelo Falcone is chief executive officer, Medical Emergency Professionals (MEP).  He blogs at the EmergencyDocs Blog.

Comments are moderated before they are published. Please read the comment policy.

  • Paul Dorio

    The author paints a stark picture of “becoming employed” versus “delivering a unique service.” Each of us delivers a “unique service” to our patients. We are focused on delivering high quality care. No employment agency/entity can say the same. Hospital administrators are acutely aware of the costs of care while doctors are acutely aware of the value of care. What I believe doctors must do is come together like never before. Consolidation into ACOs, run by doctors for patients, is the only realistic way that I see PPACA making a positive difference in the lives of doctors and patients. Otherwise hospital entities will consolidate and swallow up physician practices. Remember that the underlying goal of a hospital is to keep costs low. The underlying goal of a physician is to care for patients and improve the quality of their lives. The focus must be on patient care and not on whether to become employed.

  • Robert Young

    This scenario gives just two choices, hang together or hang separately!
    There is a third, practice medicine and provide services to those whose payments pay your practice costs and provide a reasonable profit for your professional services.
    If and when that becomes one or more entitlement programs or some state insurance exchange what sense does it make for physicians to work for amounts that don’t pay your costs or be forced to “up-code” claims and worry about being brought up on fraud charges? The more entitlement patients you have the more likely this becomes as you can see reading the papers.

  • Robert Luedecke

    Very good article! Why limit yourself to being tied to only one hospital system? Many of us work where there is more than one competing hospital system. What if you pick the one that goes broke? Much better to contract with hospital systems and stay independent. Many years ago I worked at a hospital that was new and the most desired place to get care. After bad news came out about that hospital’s business practices, most of the patients left and I went with them to the hospital across the street.