Ex­am­ine those doc deals

Modern Healthcare - - OPINIONS LETTERS -

Re: “Few spared in con­sul­tant’s re­view of health­care scene,” ModernPhysi­cian blog, Sept. 23: Hos­pi­tals now have the up­per hand in physi­cian prac­tice ac­qui­si­tions. More than 50% of physi­cian prac­tices are now owned by hos­pi­tals. The per­cent­age has in­creased dra­mat­i­cally over the past two years with a game-chang­ing at­ti­tude shift by physi­cians.

The real work is not in ne­go­ti­at­ing the deals, but in en­sur­ing ac­count­abil­ity, qual­ity and pro­duc­tiv­ity with a fi­nan­cially re­ward­ing out­come to the ac­quired physi­cians in the prac­tice who be­come salar­ied em­ploy­ees and a re­turn on in­vest­ment to the en­tity pur­chas­ing the prac­tice.

There are five prime rea­sons to con­sider in­te­gra­tion. Un­less a physi­cian or a mul­ti­physi­cian prac­tice can re­al­ize a net gain in at least two of them, the prob­a­bil­ity of a suc­cess­ful and mu­tu­ally re­ward­ing trans­ac­tion is low. The five key com­po­nents are: in­fra­struc­ture economies of scale (doc­u­mented cost-sav­ings), in­crease in man­aged­care con­tract re­im­burse­ment, group pur­chas­ing ad­van­tages, mal­prac­tice premium re­duc­tions, and com­ple­men­tary ser­vices.

Emo­tional in­te­gra­tion for the sake of “just do­ing some­thing” is never a good rea­son to act. With one-third of prac­tic­ing physi­cians age 55 and over—more than 250,000 physi­cians—this is a sub­ject of in­creas­ing fre­quency and con­cern among physi­cians all over the coun­try look­ing for an exit strat­egy and a way to mon­e­tize the good­will in their prac­tices from, in many cases, over 25 years of busi­ness and ded­i­ca­tion to their pa­tients.

A. J. Ros­marin Ros­marin Con­sult­ing


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