Between July 2015 and July 2016, hospitals acquired 5000 independent physician practices, and the number of physicians employed by hospitals grew by 14,000, according to a report from Avalere Health and the Physicians Advocacy Institute.
Hospital acquisition trends continue to persist, according to a report from Avalere Health and the Physicians Advocacy Institute (PAI), which found that 5000 independent physician practices were acquired by hospitals between July 2015 and July 2016.
During the time period, the number of physicians employed by hospitals grew by 14,000, also representing an 11% increase in employed physicians. According to the report, every region of the country saw an increase in both hospital ownership of practices and physician employment. The rate of hospital-owned practices increased between 8% and 47% in every region in the country, and the rate of hospital-employed physicians increased between 5% and 22%.
“As payers and hospitals drive consolidations across the healthcare system, it is becoming more and more difficult for a physician to maintain an independent practice,” said Robert Seligson, president, PAI, and chief executive officer of North Carolina Medical Society, in a statement.
These trends represent the fourth consecutive year of growth in hospital acquisition of practices and physician employment. Over the past 4 years, the percentage of hospital-employed physicians increased by more than 63%, with increases in nearly every 6-month time period. Regions nationwide saw an increase in hospital-owned practices at every measured time period, ranging from 83% to 205%.
Regionally, more than half of physicians in the Midwest were employed by hospitals, and more than one-third of Midwest physician practices were hospital owned in 2016. Rates of employment were lowest in the south, where 37% of physicians were employed by hospitals, and in Alaska and Hawaii, where 33% were employed.
“When physicians are employed by hospitals or health systems, they perform more services in a hospital outpatient department setting (HOPD) than independent physicians,” states the report. “The higher proportion of services performed in a HOPD setting increases both costs to the Medicare program and financial responsibility for patients.”
According to the report, for cardiac imaging, colonoscopy, and evaluation and management services, Medicare pays more across an episode of care when patients receive services in a HOPD setting. For cardiac imaging, it costs $5148 for an episode of care in an outpatient department, compared to $2862 in a physician office; for colonoscopy, it costs $1784 for an episode of care in an outpatient department, compared to $1322 in a physician office; and for evaluation and management services, it costs $525 for an episode of care in the outpatient department, compared to $406 in a physician office.
A recent study published in JAMA Oncology found similar cost differences in the administering of chemotherapy. The researchers found that the administering of infused chemotherapy is increasingly shifting from physician offices to HOPDs and is also associated with increased spending on chemotherapy services for commercial insurers.
The Avalere Health and the PAI report builds upon a prior analysis from the partnership that examined national and regional changes in physician employment trends from July 2012 through July 2015. The study found that the number of physician practices acquired by hospitals and health systems increased by 86% during the time period, with the percentage of physicians employed by hospitals or health systems increasing in every region of the country. By mid-2015, nearly 40% of physicians were employed by hospitals and health systems, reflecting an approximately 50% increase during the 3-year period.
Standard Criteria for Loss of Ambulation Needed in DMD
April 19th 2024A recent study suggests the differences between ambulation definitions for patients with Duchenne muscular dystrophy (DMD) can impact the identification of ambulant vs nonambulant individuals, and standard criteria across settings are needed.
Read More
Overcoming Employment Barriers for Lasting Social Impact: Freedom House 2.0 and Pathways to Work
April 16th 2024To help celebrate and recognize National Minority Health Month, we are bringing you a special month-long podcast series with our Strategic Alliance Partner, UPMC Health Plan. Welcome to our second episode, in which we learn all about Freedom House 2.0 and the Pathways to Work program.
Listen
Early Involvement Critical in Treating Immunotherapy-Induced Overlap Syndrome
April 19th 2024A series of case studies reveals the importance of early diagnosis and involvement of special teams of clinicians when dealing with potential cases of overlap syndrome, which encompasses myocarditis, myasthenia gravis, and immune checkpoint inhibitor–related myositis.
Read More
Making Giant Strides in Maternity Health Through Baby Steps
April 9th 2024To help celebrate and recognize National Minority Health Month, we are kicking off a special month-long podcast series with our strategic alliance partner, UPMC Health Plan. Welcome to our first episode, which is all about the Baby Steps Maternity Program and its mission to support women throughout every step of their pregnancy journey.
Listen