Hospital's and Health Systems cannot afford to pay Physicians....so Phyicians back to private practices!

Just one problem….Many newly trained physicians are being taught to treat patients in an employed model! Let’s just see how it all works out. At any rate…Private Single Specialty practices will be growing in number, and at the end of the day patients will benefit!

Hospitals to reverse trend of employing doctors – consultant

Mar 3, 2015, 1:27pm EST Updated: Mar 30, 2015, 10:04am EDT

 

Carrie Ghose           Staff reporter- Columbus Business First

 

Hospitals and health systems nationwide are losing millions on physicians they've employed by acquiring practices, so a practice-management specialist predicts doctors will soon start spinning out on their own again.

"The pendulum has swung," Tom Ferkovic, managing director of Medic Management Group LLC. "We're starting to see hospitals can no longer afford to own all the practices."

As a result, he expects growth in the 154-person Akron-based firm, including its Columbus office, now with five employees.

The consulting and management outsourcing company renamed itself from SS&G Healthcare Services LLC in December, after BDO USA LLP acquired Cleveland accounting firm SS&G Inc. The health-care consultants were a 15-year-old separate company that co-branded with SS&G, and opted not to go with BDO. Partners in the former SS&G still own shares. The Columbus branch is currently hunting space to leave the BDO office on Spring Street.

Medic Management takes over a practice's back-office functions – billing, insurance reimbursement, payroll – to increase efficiency. As hospitals started acquiring its clients statewide, it formed a hospital division because the health systems didn't have infrastructure or experience running practices.

Nationwide, health systems lost on average $188,000 on each employed physician in 2013, and that increased last year, according to surveys by the Medical Group Management Association, which also is asking if " the tide has ebbed" on acquisitions. In Ohio it's slightly lower, about $187,000, Ferkovic said, and his group has helped hospitals stem such losses.

Physicians have started leaving hospital umbrellas in northern Ohio and out-of-state, he said.

"We're starting to hear discussions of it in (Central and) southern Ohio," he said. "It's coming. We're hearing noise from some of our clients about it."

This has happened before: In the 1990s hospitals started selling off practices acquired in a previous wave. But in 2008, health systems said things were different this time because they would base physician pay on productivity. Hospital employment stretched from primary care to specialties; Central Ohio's last independent cardiology practice group closed in 2014.

But insurance reimbursement still didn't match what hospitals pay doctors. Systems would make that up with lab tests, imaging and procedures – but now Medicare and private insurers are cutting reimbursement rates for those, Ferkovic said.

Doctors who leave aren't going back into untenable solo or two-person offices, he said. They're forming large 30-plus doctor groups, and smaller independent practices are consolidating. Central Ohio Primary Care Physicians Inc. and Orthopedic One – themselves the products of acquisitions and mergers – are among fewer than a dozen independent practices statewide with more than 30 doctors. Expect more, he said.

"Large private groups in the state have done very well over the last few years," he said. "Some are doing really creative things with quality measures and contracting for risk and bundled payments. They're faster, they're more nimble when they have an issue on fixing those, because its their money."