10 Healthcare Reform Market Changes Affecting Physicians

Laura P. Jacobs, MPH, for HealthLeaders Media , March 16, 2011

8.      Reframing the clinical workforce. The ACA includes funds to increase training positions for primary care and general surgery, add training in preventive medicine and public health, and support training for medical homes and team management of chronic disease, among other initiatives. But these will likely fall short of filling the gap of demand/capacity in many key specialties – particularly primary care. In addition, the generational shift in expectations among young physicians – for employment models that provide greater security, balanced work life, and part-time options that many small private practices cannot offer – creates a dynamic in many markets where the big groups (or hospital-owned) get bigger, and the small practices disappear as physicians retire. All this requires physicians to evaluate how their group or practice is structured for recruitment of a clinical workforce to facilitate growth and/or succession planning to meet community need. This may require looking to advanced practice nurses or physician assistants as well as a re-evaluation of compensation plans, benefits, and even medical group structure.

9.      No relief in operating costs. Despite the fact as previously noted that traditional sources of revenue are likely to be constrained in the future, there is nothing in the ACA or in economic trends that give practices any relief in day-to-day practice expenses. The ACA does little to mitigate increases in malpractice costs, the taxes on biotech and pharmaceutical companies are likely to increase these supply costs, and implementing EMR requires annual maintenance fees. So the recent trends of increasing overhead costs will not likely go away – unless practices evaluate new models of care or ways to achieve economies. This means evaluating how support staff are being utilized (i.e., are they working at the top of their qualifications in a way that maximizes provider productivity and effectiveness)?

10.Hospital relationships matter. In recent years the “centricity” of the hospital as the focal point of the healthcare community has been affected by conflicting trends: on the one hand, hospitals are the employer of physicians at an increasing rate; on the other, there are many physicians who never set foot in the hospital and are unaware where the medical staff dining room is or cannot recognize key specialists other than by name. Further, many of the hopes for healthcare reform are riding on better chronic care management, which is not a skill most hospitals possess. What the new payment models (e.g., shared savings, bundled payment, PCMH) and the “triple aim” espoused by Dr. Don Berwick of CMS (i.e., “better care, improved health, and lower costs”) require, though, is a care delivery system that is based on collaboration between physicians, hospitals, and other healthcare providers. To achieve optimal performance under any of the proposed payment models, whether you are a small practice or large multispecialty practice, requires collaborative physician-hospital relationships. This will require both hospitals and physicians to put aside old frameworks that assume one entity “controls” the other; how these partnerships evolve will depend on who leads innovation and demonstrates a commitment to healthcare improvement and operates effectively to remain financially strong.

          Laura Jacobs at ljacobs@thecamdengroup.com.

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1 comments on "10 Healthcare Reform Market Changes Affecting Physicians"

Bill Gustafson (6/3/2011 at 7:23 PM)
In a small way we saw this coming so we built our company on the premise of a lean low margin operation. However, the scope and depth of what is happening is clearly beyond anything I would have imagined. Each point in this article covers a broad area that in itself could be market changing and the list is long. I look forward to the challenge but doubt there will be any industry stability in the near future. Hopefully, at the end of the day, we will arrive in a good place.




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