You Must Be Kidding: And spending $30K per doc on electronic health records will fix this ? A lot of docs may be willing to take the incentive payments but have little doubt about what the impact will be on their practice environments.
Which is why more dots on the canvas are needed to see why hospitals view docs as bull market opportunities. They are more than happy to joint venture and hire or own more physician assets because The Best Defense Is a..... Not only do the existing revenue streams need to be protected, but new ones have to be developed . The means ever more services by ever more physicians.
Those Who Read About the Past Are Condemned to Repeat It: The DMCB suspects the current crop of hospitals execs have forgotten the '80's Physician-Hospital-Organization (PHO) debacles. While some PHOs succeeded in managing episodes of care , most were unable to achieve the most important part of making this work: cost-effective utilization.
All of which leads to a DMCB Prediction Despite the dire circumstances, there are still plenty of practices out there that are and will continue to be profitable. They are owned by savvy, hard working and entrepreneurial physicians that know how to manage overhead, maximize cash flows, hire the right kind of office help, keep their customers satisfied, document things to satisfy any audit, vigorously defend against any allegation of malpractice, show their unsatisfied customers to the door, work with their local medical society, handle bad debt, minimize the percent of Medicaid in the practice, aggressively refuse to be pushed around by insurers and, most importantly, keep the local hospital at arms length. While the Wal-Marts and Kaiser Permanentes are currently in the ascendancy, there will always be smaller and moderate size businesses in their shadow who can profitably service a sizable market segment. They won't go away and many will thrive. What's more, some of the reborn PHOs-ACOs will struggle and the bloom will come of the rose of physician-hospital integration. The only question is where the market will equilibrate over the short term. It will not be 0% private practice.
As for over the long term, who knows? That will be the topic of a future post ( which is here ) .... and maybe a different allegory.