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Physician Practice Acquisition and Employment Trends

A new report by the Physicians Advocacy Institute (PAI) in collaboration with Avalere Health analyzes recent trends in physician employment and the acquisition of physician practices by hospitals and health systems. Physicians may become employees through a group practice acquisition, or individual physicians may enter into employment arrangements directly with hospitals/systems. Here are some highlights from the analysis:

  • Between July 2012 and July 2015, the percentage of hospital-employed physicians increased nearly 50%
  • By 2015, 38% of physicians were employed by hospitals
  • Hospital or system ownership of physician practices grew by 86% from 2012 to 2015
  • By July 2015, there were 67,000 hospital-owned physician practices
  • One in four physician practices was hospital-owned by 2015

Regionally, nearly half of all physicians in the Midwest were employed by hospitals in 2015. Physician employment rates were lowest in the South and in Alaska and Hawaii where a third of physicians were hospital-employed. The pros and cons of these employment trends are briefly listed.

PAI and Avalere are planning additional analysis of this trend and its implications for early 2017.

 

Source: Avalere Health. Physician practice acquisition study: national and regional employment changes. Physicians Advocacy Institute, Sept. 2016. http://www.physiciansadvocacyinstitute.org/Portals/0/PAI-Physician-Employment-Study.pdf

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

MEDICAL GROUPS: Top 10 largest in the U.S.

This is a study of large medical group practices, comparing characteristics of academic medical groups (“gown”) with those not linked to medical schools (“town”).  A large part of the study involved developing a list of the 100 largest practices – which included those from about 500 physicians at the bottom of the list of 100 to ten times that many at the top.  An average of about one-quarter of physicians in these large practices were primary care physicians (PCPs).  However, there was a smaller percentage of PCPs in the academic practices than in the community practices.

Top 10 Largest Physician Practices: U.S. 2013

  1. Northern California Permanente Medical Group (the largest with 5,634)
  2. Southern California Permanente Medical Group
  3. Harvard University
  4. Mayo Medical School
  5. Case Western Reserve University
  6. University of Pittsburgh
  7. University of Washington
  8. University of Michigan
  9. Johns Hopkins University
  10. University of Texas, Houston

Source: Welch, W.P., and Bindman, A.B. (2016, July). Town and gown differences among the 100 largest medical groups in the United States. Academic Medicine, 91(7), 1007-1014.  Click here: http://journals.lww.com/academicmedicine/Abstract/2016/07000/Town_and_Gown_Differences_Among_the_100_Largest.32.aspx  Posted by AHA Resource Center (312) 422-2050, rc@aha.org

Top 10 Issues Facing Community Hospital CEOs

Last month the American College of Healthcare Executives released the results of its annual CEO survey on the top concerns confronting community hospitals. The most pressing concerns of the CEOs in 2015 were:

  1. Financial challenges
  2. Patient safety and quality
  3. Governmental mandates
  4. Personnel shortages
  5. Patient satisfaction
  6. Physician-hospital relations
  7. Access to care
  8. Population health management
  9. Technology
  10. Reorganization [mergers, acquisitions, restructuring, partnerships]

Financial challenges has remained the top concern when compared to 2013 and 2014 surveys. Transition from volume to value, Medicaid reimbursement, bad debt, and increasing costs were among the financial challenges most often mentioned. Engaging physicians in improving the culture of safety/quality and in reducing clinically unnecessary tests and procedures were top concerns related to patient safety and quality.

Access to care and reorganization were new to the top 10 list in 2015, and personnel shortages rose to 4th place on the list, up from the 10th spot in 2014.

Source: Top issues confronting hospitals in 2015. American College of Healthcare Executives, Feb. 2, 1016. http://ache.org/pubs/research/ceoissues.cfm [press release: http://ache.org/pubs/Releases/2016/top-issues-confronting-hospitals-2015.cfm]

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

AMA Physician Benchmark Reports on Compensation Methods and on Prevalence of New Models of Care

Two 2014 Physician Practice Benchmark Survey reports have been released by the American Medical Association within the past few months. The first looks at compensation models used to pay physicians, and the second provides data on the prevalence of physician participation in accountable care organizations and medical homes and the use of alternative payment methods [capitation, pay-for-performance, bundled payments, or shared savings].

Here are some of the key findings from the reports:

  • For many physicians, compensation was a blend of different methods. Half of compensation for non-solo physicians came from salary, another third was productivity-based, 12% was based on practice financial performance, and 4% came from bonuses. The proportions varied when analyzed by type of practice and its ownership.
  • Fee-for-service is still the dominant payment method for physicians, although 59% of physicians said their practice received some revenue from an alternative payment method. An average 72% of practice revenue came from fee-for-service. Unsurprisingly, practices participating in a medical home or ACO received a larger proportion of their revenue from alternative payment methods.
  • In 2014, 24% of physicians worked in practices that were part of a medical home, and 29% reported working in a practice that was part of an ACO. Participation rates were higher in multi-specialty practices and lower in solo practices. Hospital-owned practices also had higher medical home and ACO participation rates.
  • In single specialty practices, participation in a medical home was lowest for surgery and its subspecialties and highest for family practice and pediatrics. However, ACO participation was highest for general surgery and family practice but low for pediatrics

Sources:

Kane CK. Payment and delivery in 2014: the prevalence of new models reported by physicians. American Medical Association Policy Research Perspectives, Dec. 2015. http://www.ama-assn.org/ama/pub/advocacy/health-policy/policy-research.page – expand Medical Practice section to select report [free web site registration and login required to view/download]

Kane CK. How are physicians paid? A detailed look at the methods used to compensate physicians in different practice types and specialties. American Medical Association Policy Research Perspectives, Aug. 2015. http://www.ama-assn.org/ama/pub/advocacy/health-policy/policy-research.page – expand Medical Practice section to select report [free web site registration and login required to view/download]

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

AMA Update: Physician Practice Arrangements Trend Data

The AMA has released results of its 2014 Physician Practice Benchmark Survey, and here are some of the findings:

  •  In 2014 a third (32.8%) of physicians worked directly for a hospital or were in a physician practice at least partly owned by a hospital, an increase from 29% in 2012. While comparable AMA data is not available prior to 2012, it is estimated that in 2007-2008 about 16% of physicians worked for a hospital or hospital-owned practice.
  • The share of physicians directly employed by hospitals grew from 5.6% in 2012 to 7.2% two years later. A quarter of physicians worked for hospital-owned practices in 2014.
  • Single specialty group practice is the most common practice type, but multi-specialty group practices have increased.
  • The portion of solo physician practices has shrunk from 43.8% in 1983 to 18.6% in 2014.
  • Physicians under age 40 or female physicians were most likely to be employed by a practice, hospital, or other entity.

The report also provides data on the size of physician practices, based on the number of physicians in the practice.

Source: Kane CK. Updated data on physician practice arrangements: inching toward hospital ownership.  Policy Research Perspectives, American Medical Association, July 2015. http://www.ama-assn.org/resources/doc/health-policy/x-pub/prp-practice-arrangement-2015.pdf  [free site registration/login required to view/download]

Related sources:

Commins J. 6 in 10 physicians work in small practices. HealthLeaders Media, July 9, 2015. http://www.healthleadersmedia.com/page-1/PHY-318354/6-in-10-Physicians-Work-in-Small-Practices

2014 Survey of physician practice and contracting arrangements with hospitals. American Hospital Association, April 2015. http://www.ahaphysicianforum.org/resources/leadership-development/survey/index.shtml [AHA member-only report; employees of member hospitals/systems have member access]

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

HOSPITALISTS: How many are there and what is their role?

The term “hospitalist” was coined by Dr. Robert Wachter in the mid-1990s.  Today, there are an estimated 44,000 hospitalists in the United States.  This is a self-designated specialty, there is not yet board certification specifically for hospital medicine.  This articles provides a brief overview of the dual role of hospitalists in many hospitals – caring for inpatients and also serving as experts to promote more efficient processes and best practices in the hospital setting.

Source: Rohde, M. (2014, May-June). The role of the hospitalist. Health Progress. 95(3), 27-30.  Click here for access to article: http://www.chausa.org/docs/default-source/health-progress/the-role-of-the-hospitalist.pdf?sfvrsn=2   Posted by AHA Resource Center (312) 422-2050, rc@aha.org

2014 Survey of America’s Physicians: Practice Patterns and Perspectives

The Physicians Foundation is out with its latest biennial survey of physicians in the country, looking at work satisfaction, practice patterns, and other attitudes of over 20,000 survey participants. Key questions addressed in the survey include these:

  • Are they seeing more or fewer patients?
  • Do they continue to accept Medicare and Medicaid as a form of payment?
  • How do they grade the Affordable Care Act?
  • How many are part of an ACO?
  • What effect have electronic medical records had on their practice?
  • Are they independent practice owners or employees?
  • Do they plan to retire, work part-time, practice concierge medicine, seek hospital employment, or pursue some other option?

And here are some of the answers from physicians:

  • 38% do not see Medicaid patients or limit the number of Medicaid patients seen.
  • 46%  give the Affordable Care Act a failing grade.
  • 26% participate in an ACO, but only 13% think ACOs will improve quality or lower costs.
  • 85% have adopted electronic medical record,s but 46% say they detract from their efficiency.
  • 53% describe themselves as employees, up from 44% in 2012.
  • 44% plan to take steps that could impact the physician supply and patient access, such as retiring, closing their practices to new patients, cutting back on the number of patients seen, or seeking a non-clinical job.

Source: Merritt Hawkins. 2014 survey of America’s physicians: practice patterns & perspectives. Physicians Foundation, Sept. 2014. http://www.physiciansfoundation.org/uploads/default/2014_Physicians_Foundation_Biennial_Physician_Survey_Report.pdf

Posted by AHA Resource Center, (312) 422-2050, rc@aha.org