Another Perspective on Healthcare Consolidation

Here is a piece that a friend of mine sent me.  It appeared in a healthcare blog.  It recounts a probably fictional event in which a doctor saw a briefing paper intended for a hospital executive but accidentally left behind by a consultant.  The briefing paper described the steps the hospital administration could take to increase its control over the decision making of its medical staff.  Although written over five years ago, the trends it describes are even more pronounced today than they were then.

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I have written about conflicts of interest for doctors brought about by the increasing consolidation taking place in the health care industry.  Hospital chains are getting bigger and bigger.  Not only are they opening new hospitals, they are purchasing the medical practices of the doctors who practice at their hospitals.

Although many doctors are reluctant to admit it, their new relationship with the hospital gets in the way of their independence and their obligation to make decisions and recommendations in the best interest of their patients.  Now there is an elephant in the room along with the doctor and the patient.  It is the hospital employer that controls the doctor’s income and working conditions.  The elephant’s wishes must be respected and, as this article makes apparent, doctors are beginning to understand the consequences of the bargain they made when they sold their practices to the hospital.

In the briefing paper at the heart of the article that appeared in the healthcare blog, the consultant offered up a number of strategies the hospital could pursue to both directly and indirectly influence the decision making of the doctor to assure that those decisions would benefit the hospital.  This control is considered necessary by the hospital since a very large percentage of hospital revenue is driven by decisions and recommendations made by the medical staff.  Obviously, it makes a difference to the hospital if the doctor decides to admit her patient to the hospital as opposed to treat the patient in the office or if the doctor decides to operate on the patient.  When the patient is discharged, there are often a number of places the patient can be sent for rehabilitation or longer term care.  If the hospital owns one of these facilities, as it often does, it would like to have the patient sent there instead of to a competitor.

According to the briefing paper, the hospital can keep its doctor employees in line by employing various strategies to keep the doctors nervous and unsettled.  The paper offers up a number of suggestions such as making the doctor’s compensation difficult to determine so as to keep the doctor guessing and dependent on the hospital.  Fire some doctors and make it very public.  Keep switching hospital systems around so that doctors will feel they do not understand what is going on.  Make billing systems difficult.  Make systems unreliable so the doctors must rely on someone at the hospital to help them.  Use jargon to confuse the doctors.  Show doctors they are not nearly as important in the scheme of things as they think they are.

These suggestions are intended to deal with the doctors who still want to be ethical and to do the right thing for their patients.  They are intended to bend the doctors to the will of the hospital without actually asking them to ignore their ethical obligations.  By making them unsure of themselves and their decision making, the hospital can influence those decisions in a way that benefits its bottom line.

Healthcare consolidation is almost never a good thing for patients.  Statistics show that health care costs go up when the number of competing hospitals goes down.  Hospital control over the doctors is another step down this path.  I can hardly wait to see what they think of next but I am pretty sure I won’t like it.


Posted in Doctors, electronic medical records, Fee for Service, Health Care Costs, Hospitals, medical charts, Medical Costs, medical ethics, Secrecy |